Planning for Life

4 Reasons Why You Probably Don't Want an ILIT

Posted by Harry S. Margolis on August 12, 2021

By Harry S. Margolis

life insurance-margolis-bloom-estate-planning-wellesleyThe irrevocable life insurance trust or "ILIT" has long been a mainstay of estate tax planning. It allows the taxpayer to shelter life insurance proceeds from the estate tax by removing them from her taxable estate. It has become much less commonly used as the federal estate tax threshold has moved up to $11.7 million, but will be of interest to more people as we get closer to 2026 when the threshold is slated to be cut in half. And, of course, the threshold is just $1 million in Massachusetts.

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Topics: irrevocable trust, life insurance

Limited POA Does Not Make Trust Countable SJC Rules

Posted by Harry S. Margolis on July 27, 2021

By Harry S. Margolis

In Patricia A. Fournier vs. Secretary of the Exec. Office of Health & Human Services (SJC-13059, July 23, 2021), the Supreme Judicial Court finally puts to rest a MassHealth argument that property in an irrevocable trust may be countable if the grantor retains a limited power of appointment to charity. The SJC had left this question open in the prior case of Daley v. Secretary of the Exec. Office of Health & Human Servs., 477 Mass. 188, 203 (2017).

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Topics: long-term care planning, MassHealth, irrevocable trust

Is a Grandchild Born Out of Wedlock a "Grandchild" in a Trust?

Posted by Harry S. Margolis on July 20, 2021

By Harry S. Margolis

Trusts-Steve-Bing-Inheritance-grandchildren-margolis-and-bloom

The sad story of Stephen Bing, a Hollywood impressario who committed suicide last year at age 55 after running through his $600 million inheritance from his real estate mogul grandfather, continues with a court decision disinheriting his out-of-wedlock children.

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Topics: Grandchildren, irrevocable trust

Which Spouse is the "Spouse" in the Trust?

Posted by Harry S. Margolis on March 23, 2021

By Harry S. Margolis

divorce-trust-beneficiary-estate-planning-attorney-Wellesley-MA-02481

A recent Texas case, Osche v. Osche, shows the benefit of using names when drafting rather than terms such as "spouse." In 2008, Amanda Hurst Ochse created an irrevocable trust for the benefit of her son, William W. Ochse III, his children, and his "spouse." For almost 30 years, he had been married to Cynthia Cadwallader Ochse. However, they got divorced in 2012 and in 2015, William married Carol Osche.

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Topics: irrevocable trust, rules of construction

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