California Tax Attorney Blog

David M. Goldman, an estate planning attorney in Florida, has an interesting article worth reading at his blog. Simply substitute "California estate planning" or "California estate planning lawyer" for the reference to "Florida" and you should be able to obtain some valuable information. Or, simply call Mitchell A. Port, a California estate planning attorney, at (310) 559-5259 to discuss your concerns.

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Jonathan G. Blattmachr and Georgiana J. Slade at Milbank, Tweed, Hadley & McCloy LLP, and Bridget J. Crawford at Pace University - School of Law, have written an article in the March, 2007 edition of "Estate Planning" magazine, addressing estate planning for those of us with estates under five million dollars. I have posted the full article at the same time as this posting.

Here is an abstract for the article:

"Financial concerns may preclude people of modest wealth (defined for purposes of this article as those having a net worth between $1 million and $5 million) from making significant lifetime transfers to achieve estate planning goals. Yet lifetime transfers are among the most effective ways to reduce estate taxes. Individuals of modest wealth may experience a tension between the desire to take advantage of opportunities to reduce taxes and protect assets from other claims which may arise, on the one hand, and the need to preserve an adequate base of wealth to ensure the maintenance of a current standard of living, on the other.

"The advisor to these individuals carefully should consider what estate planning steps are most appropriate and what level of transfers, if any, the individual reasonably can afford to make.

"This article details and evaluates eleven strategies that may apply to clients in the modest wealth category:

"(1) inter vivos transfers of life insurance and other non-income producing assets;

"(2) estate building and income tax sheltering with life insurance;

"(3) qualified personal residence trusts;

"(4) effective use of annual exclusions;

"(5) self-settled trusts;

"(6) potential use of the gift tax exemption and the GST exemption;

"(7) assessing income tax-free states;

"(8) using a charitable remainder trust to build wealth and generate income;

"(9) medical care and tuition payments;

"(10) limited liability entities for asset protection and tax planning; and

"(11) special care in handling interests in qualified plans, IRAs and other IRD."

To speak with an estate planning attorney in Los Angeles, California, call Mitchell A. Port at 310.559.5259.

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Most would rather not think about it but if your child is 18 or older then it is appropriate for him or her to have an advance health care directive. All the same reasons that apply for older adults to have the directive also apply to a younger adult. While you're at it, perhaps a will, living trust and durable power of attorney for property management may also be a good thing.

Speak with a Los Angeles attorney to help decide what makes sense. Call Mitchell A. Port at 310.559.5259.

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In this past Sunday's edition of the Los Angeles Times, David Colker wrote an interesting article about setting up a trust for your pet as provided under California law. This article is along the lines of my earlier blog entry entitled "No Kidding - A California Trust For Your Pet" written on December 17, 2007. Here is what David Colker wrote:

Leona Helmsley was a nice mom -- to her dog.

Just look at her will. The multimillionaire hotel owner, whose nickname was the Queen of Mean, left nothing to her late son's children when she died last year.

But her beloved Maltese named Trouble got $12 million to keep him in the manner to which he was accustomed.

It became a national joke, but it also put a spotlight on a serious concern.

"It raised awareness about what happens to pets if they outlive us," said Michael Markarian, executive vice president of the Humane Society of the United States.

"We think of pets as having a short life span so we assume it won't happen. But just in case, we should ensure they go to a loving home."

Without a trust fund or some other way to provide for care, a long-adored pet could end up in a shelter.

"It's not uncommon," said Ryan Drabek, spokesman for Orange County Animal Care Services. "We get calls from the coroner to come pick up a pet if there are no family members who will do it."

Pet trusts have the force of law in 39 states, including California. In general, the money is turned over to a designated caregiver -- often a family member or friend -- who takes the pet in.

But the California law, which went into effect in 1991, is considered weak compared with most of the others. It states that the wishes expressed "may be performed by the trustee for the life of the animal."

The problem is the word "may."

"It makes the law unenforceable," said Adam Keigwin, spokesman for state Sen. Leland Yee (D-San Francisco), who has introduced legislation to make pet trusts more bulletproof.

The revised law says instructions in a pet trust should not be considered a "mere request." The bill was approved by unanimous vote in the Senate in January and is awaiting action in the Assembly.

In case of a challenge, the proposal directs that courts "carry out the general intent of the trust."

Great care should be taken in planning a pet trust, Markarian said. It's important to have a detailed discussion with the designated caregiver.

"It's not something to spring on someone by surprise after you die," he said. "Suddenly, they find out they are taking care of Fido or Fluffy."

Markarian also suggested naming at least one backup in case the primary designee can't take the pet when you die.

The people you name can't be forced to take care of the animal. If you don't plan well, the pet could still end up in a shelter until a new home for it is found, if ever.

To determine the amount of money that should be set aside, a pet owner should figure out how much will be spent for food and regular medical care for the estimated life of the animal and then add a substantial amount in case of major medical problems.

Still, the funds could get depleted. At that point, all you can hope is that affection will take over.

"If you pick the right person," Markarian said, "that pet is not going to be abandoned when the money runs out."

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California has a free Advance Health Care Directive form. Just click here. The California Medical Association also has a free form. Use either one - they are both good.

For more extensive estate planning that includes, in part, a living trust, a pour-over will and a durable power of attorney for property management, consult with Mitchell A. Port by calling him at 310.559.5259.

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The question I sometimes hear as part of my California probate law practice from clients after the death of a loved one is: “What do I need to do now?” Not all of the points below will apply to all Decedents, but many of them will. What follows should be considered when a close friend or relative dies who owns property in Los Angeles County, Santa Barbara County, Ventura County or Orange County, California:

1. If the death occurs at home, you may need to contact a local police officer or coroner.

2. Notify family and friends. You may want to consider having family members contact others to save yourself some time on the phone during a stressful period.

3. If the Decedent wished, a donation of body parts and tissues should be considered.

4. If a doctor is not present, notify a doctor or coroner in order to obtain a death certificate.

5. Contact a funeral home concerning burial or cremation arrangements.

6. Look for instructions which the Decedent may have left regarding preferences for funeral and burial arrangements.

7. Complete funeral and burial arrangements.

8. Determine if the Decedent belonged to a burial or memorial society that may make special arrangements for the funeral, such as military honor guards.

9. Contact the Social Security Administration and any other government agencies or benefit program that may be making payments to the Decedent. (Note that the payment for the month of death will not be made by the Social Security Administration and others.)

10. Review the Decedent’s financial affairs and look for any estate planning documents, such as Wills and Trusts, along with any other relevant documents, including:

Continue reading "What To Do When Someone Dies" »

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The Federal estate tax is a tax on the right to transfer property at death. The tax, reported on Form 706, United States Estate (and Generation Skipping Transfer) Tax Return, is applied to estates for which at-death gross assets, the "gross estate," exceed the filing threshold. Included in gross estate are real estate, cash, stocks, bonds, businesses, and decedent-owned life insurance policies. Deductions are allowed for administrative expenses, indebtedness, taxes, casualty loss, and charitable and marital transfers. The taxable estate is calculated as gross estate less allowable deductions.

The IRS Estate Tax page provides further information concerning the estate tax. Covered are topics including:

Frequently Asked Questions on Estate Taxes Gift Tax

Frequently Asked Questions on Gift Taxes

Filing Estate and Gift Tax Returns

Forms and Publications - Estate and Gift Tax

Publication 950, Introduction to Estate and Gift Taxes

What's New - Estate and Gift Tax

Once you have accounted for the Gross Estate, certain deductions (and in special circumstances, reductions to value) are allowed in arriving at your "Taxable Estate." These deductions may include mortgages and other debts, estate administration expenses, property that passes to surviving spouses and qualified charities. The value of some operating business interests or farms may be reduced for estates that qualify.

After the net amount is computed, the value of lifetime taxable gifts (beginning with gifts made in 1977) is added to this number and the tax is computed. The tax is then reduced by the available unified credit. Presently, the amount of this credit reduces the computed tax so that only total taxable estates and lifetime gifts that exceed $1,000,000 will actually have to pay tax. In its current form, the estate tax only affects the wealthiest 2% of all Americans.

Most relatively simple estates (cash, publicly-traded securities, small amounts of other easily-valued assets, and no special deductions or elections, or jointly-held property) with a total value under $1,000,000 do not require the filing of an estate tax return. The amount was $1,500,000 in 2004 and 2005. For 2006 through 2008, the amount is raised to $2,000,000.

To maximize your estate tax planning opportunities, call Mitchell A. Port at 310.559.5259.

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This information is not intended to be a substitute for proper estate planning. Writing your own will may result in unintended consequences, misinterpretation and perhaps litigation. Probate will not be avoided. I have listed many of the steps necessary to write your own will even though I advise against it.

To write a holographic will as a California resident, the following steps should be taken:

1. Use a completely blank sheet of paper (no letterhead, no logo, nothing on it)

2. Write the entire will in your own handwriting

3. State your name and that you are of sound mind and not under any duress to write a will

4. State the county in which you reside

5. State that it is your last will and that it supersedes all prior wills

6. State who you are married to, if you are married, and if not, so state

7. State the names of your children, if any, and if none, so state. If you have children and they are minors, list those people in an order of priority who will be guardians

8. List those people in an order of priority who will be executors

9. State that bond is waived for any executor (and guardian – if you have children) who serves

10. State who is going to inherit what property, for example, “I leave my spouse all of my interest in any property whether real or personal, including but not limited to our home on _________, Drive, my nut company on __________, Drive, my real estate on ____________ Drive, all of my cash and investments, and all the rest of my property wherever located. If my spouse does not survive me, I leave all of my interest in said property in equal shares to my children.”

11. State who else gets something by mentioning their name(s) and what they get. Add that if either the person named is not living at the time of your death or if the property is no longer a part of your estate, then the gift to that person lapses.

12. If applicable, state your intent to disinherit anyone who contests the will. For instance: “Except as otherwise provided in this Will, I have with full knowledge omitted to provide for my children and heirs, or any others who might feel entitled to some portion of my estate. I have carefully considered the needs and abilities of my family and after such consideration have disposed of my estate in the manner provided in this Will. Should any beneficiary named in this Will, or the parent of any beneficiary named in this Will, or any person claiming through a beneficiary named in this Will, or any person claiming to be an heir, directly, indirectly, singly or in conjunction with other persons, attack this Will, or contest any of its provisions, or contest any trust established by me, or seek to impair or invalidate any part or provision of my estate plan, or conspire or cooperate with anyone attempting to do any of the aforesaid, such person's interest (or if such person has no interest, but his or her child has an interest in my estate or any trust established by me, then such child's interest) in my estate is revoked and shall be forfeit and distributed as if such person (or the child of such person) had predeceased me and any generation-skipping transfer taxes caused by reason of such forfeiture shall be charged to and paid from such property without the benefit of the use of any of generation-skipping transfer tax exemption.”

13. Sign and date the document without any witnesses or a notary. Do not let anyone else sign as a witness and do not have the will notarized

This does not avoid probate and should not be used as a substitute for a complete estate plan. Consultation with an estate planning attorney like Mitchell A. Port at 310.559.5259 is strongly advised.

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The Internal Revenue Service has many forms and free publications on a wide variety of topics to help you understand and meet tax obligations, reporting and filing requirements. If you need IRS materials try one of these ways:

Walk-in: During the tax-filing season, many libraries and post offices offer free tax forms. Some libraries also have copies of commonly-requested publications. Braille materials may also be available. Many large grocery stores, copy centers, and office supply stores have forms you can photocopy or print from a CD.

Internet: You can access forms and publications on the IRS website 24 hours a day, 7 days a week, at IRS.gov.

Mail: Send your order for tax forms and publications to National Distribution Center, P.O. Box 8903, Bloomington, IL 61702-8903. You should receive your products within 10 days after we receive your order.

Phone: Call 800-TAX-FORM (800-829-3676) to order current year forms, instructions and publications and prior year forms and instructions. You should receive your order within 10 days.

Try these links:

Publication 2053A, Quick and Easy Access to IRS Tax Help and Forms (PDF 40K)

Publication 910, Guide to Free Tax Services (PDF 636K)

Need other tax help? Have other tax problems you wish to discuss with a California tax attorney? Call Mitchell A. Port at 310.559.5259.

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It is a common belief that the recipient of a taxable gift has to pay the tax.

Federal tax law is different than that: the person who receives your gift does not have to report the gift to the IRS or pay gift or income tax on its value. Instead, if you recently gave any one person gifts that are valued at more than $12,000, you - the maker of the gift - must report the total gifts to the Internal Revenue Service and you may have to pay tax on the gifts.

If you sell something at less than its value or make an interest-free or reduced-interest loan, you may be making a gift. Gifts also include money and property, including the use of property without expecting to receive something of equal value in return.

There are some exceptions to the tax rules on gifts. The following gifts generally are not taxable and do not count against the $12,000 annual limit:

Tuition or Medical Expenses that you pay directly to an educational or medical institution for someone's benefit

Gifts to your Spouse

Gifts to a Political Organization for its use

Gifts to Charities

If you are married, both you and your spouse can give separate gifts of up to the annual limit of $12,000 to the same person without making a taxable gift. In other words, you and your spouse can give one of your children (or anyone else for that matter) a $24,000 gift of cash or other property during any one year without paying any gift tax. This is commonly known as splitting gifts between spouses. Essentially, it means a gift by you or your spouse to a third person can be considered as made one-half by each of you provided there is consent by both spouses.

For more information, get the IRS Publication 950, Introduction to Estate and Gift Taxes, IRS Form 709, United States Gift Tax Return, and Instructions for Form 709. They are available at the IRS Web site at IRS.gov in the Forms and Publications section or by calling 800-TAX-FORM (800-829-3676).

Gift tax planning often requires the help of a qualified tax lawyer. Please call attorney Mitchell A. Port at 310.559.5259.

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While most tax return preparers are professional and honest, you can use the following tips to choose a preparer who will offer the best service for your tax preparation needs.

If you choose to use a paid tax preparer, it is important that you find a qualified tax professional. Taxpayers are ultimately responsible for everything on their return even when it’s prepared by someone else.

The most reputable preparers will request to see your records and receipts and will ask you multiple questions to determine your total income and your qualifications for expenses, deductions, and other items. By doing so, they have your best interest in mind and are trying to help you avoid penalties, interest, or additional taxes that could result from later IRS contacts.

Get References. Ask questions and get references from clients who have used the tax professional before. Were they satisfied with the service received?

Plan Ahead. Choose a preparer you will be able to contact after the return is filed and one who will be responsive to your needs.

Ask about service fees. Avoid preparers who claim they can obtain larger refunds than other preparers, or those who guarantee a refund or base fees on a percentage of the amount of the refund.

Research. Check to see if the preparer has any questionable history with the Better Business Bureau, the state’s board of accountancy for CPAs or the state’s bar association for attorneys. Find out if the preparer belongs to a professional organization that requires its members to pursue continuing education and also holds them accountable to a code of ethics.

Determine if the preparer’s credentials meet your needs. Does your state have licensing or registration requirements for paid preparers? Is he or she an Enrolled Agent, Certified Public Accountant, or Attorney? If so, the preparer can represent taxpayers before the IRS on all matters – including audits, collections, and appeals. Other return preparers can represent taxpayers only in audits regarding a return signed as a preparer.

Want a referral to a qualified tax return preparer from a California tax attorney? Call Mitchell A. Port at 310.559.5259.

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The California State Bar has a very interesting pamphlet offering advice on finding the right lawyer for you in California.

The pamphlet asks about 16 different questions to help you find and hire the right attorney.

The California State Bar has other useful pamphlets on topics such as California Wills, whether you need estate planning and whether you need a living trust in California.

To speak with an attorney in Los Angeles, please call Mitchell A. Port at 310.559.5259.

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Pets are no longer treated like any other piece of property. California has a law on the books under California Probate Code Section 15212 passed in 1991 which provides as follows:

A trust for the care of a designated domestic or pet animal may be performed by the trustee for the life of the animal, whether or not there is a beneficiary who can seek enforcement or termination of the trust and whether or not the terms of the trust contemplate a longer duration.

This California statute provides that you can create a trust for the care of a designated domestic or pet animal for the life of the animal. The duration will only be for the life of the pet, even if the trust instrument contemplates a longer duration.

California Probate Code Section 15212 is intended to clarify the law which may have been voidable under the rule against perpetuities provided in the California Civil Code. On the death of the designated animal, the trust permitted by Section 15212 terminates.

Before this the law treated pets like any other piece of property upon the death of their owners.

As evidence of the increasing interest in estate planning for pet owners, see Roberta C. Yafie, Trust-Fund Pets, NY Post, June 24, 2007 (stating that "[m]ore and more middle-class pet owners are opting for Pet Trusts to ensure their dependant's are cared for").

With the adoption of this code, setting up a trust to care for pets became a recognized estate planning technique. This law enables pets to become the beneficiaries of your will or trust.

Continue reading "No Kidding – A California Trust For Your Pet" »

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Those of us with federal tax problems in California are governed by the court decisions made the Ninth Circuit Court of Appeals; decisions by other Circuit Courts do not necessarily apply to California’s taxpayers directly. But in a recent decision Estate of Tamulis v. Comm'r of Internal Revenue by the Seventh Circuit Court of Appeals involving the tax treatment of a charitable remainder trust—a trust in which the income goes to individuals during their lifetime (or some other period) but what remains after their rights expire goes to charity – the Court held against carrying out the charitable intent of the donor.

Here's the story. Father Tamulis, a Catholic priest, died in 2000, leaving an estate of $3.4 million. His will left the bulk of his estate to a living trust that he had created. The trust was to continue for the longer of 10 years or the joint lives of Tamulis’s brother and the brother’s wife. During that period they would have a life estate in a house owned by the trust and the trust would pay the real estate taxes on the house.

The net income of the trust, as “determined in accordance with normal accounting principles,” would go to two of the brother’s and sister-in-law’s grandchildren (that is, Tamulis’s grandnieces), minus $10,000 a year, which would go to their third child until she graduated from medical school. Upon the termination of the trust the assets would pass to a Catholic diocese.

The estate tax return, filed in 2001, claimed a charitable deduction of $1.5 million, represented to be the present value of the charitable remainder, which was described on the return as the “residue following 10 year term certain charitable remainder unitrust at 5% quarterly payments to two grand nieces.” In each of the years 2001 through 2004, the trust distributed no more than 5 percent of the fair market value of the trust’s assets, as valued at the beginning of each year, to the grandnieces and for the payment of the real estate taxes on their parents’ home.

The Internal Revenue Service refused to allow the charitable deduction. The charitable remainder, as defined in the trust instrument, was not a charitable remainder unitrust as defined in the Internal Revenue Code. In particular, the trust instrument did not specify either a fixed dollar amount, or the percentage of the trust’s fair market value, that would go to the income beneficiaries— to the grandnieces in cash and to their parents in the form of a life estate in the house and payment of the real estate taxes on it, which would be paid out of the trust’s income.

This was a fundamental defect, fixable only by a judicial proceeding to reform the trust, filed within 90 days after the estate tax return was due. The trustee (who was also the executor of Father Tamulis’s will) and the diocese realized that there was a problem. But more than eight months elapsed before the executor prepared a complaint to file in an Illinois state court (the trust is governed by Illinois law) to reform the trust. And for unexplained reasons the complaint was never filed. Instead, in 2003 the executor circulated to the income beneficiaries a proposed reformation of the trust to bring it into compliance with the Code. But the third grandniece did not sign it, and so the trust has never been reformed, with or without a judicial proceeding, although the trustee continues to administer it in accordance with the requirements of the Code, as her predecessor (the original trustee, who has died) had said in the estate tax return that he was doing.

Her argument, rejected by the Tax Court and renewed before the Seventh Circuit, is that the statement in the return, coupled with the trustee’s continued administration of the trust as if it were a qualified unitrust, should be deemed substantial compliance with the Code, although she concedes that it is not literal compliance.

There is a doctrine of substantial compliance with the often intricate and obscure provisions of the Internal Revenue Code. The Seventh Circuit has criticized the Tax Court’s articulation of the doctrine for formlessness, and, noting that the courts of appeals do not defer to the legal rulings of that court any more than they do to the rulings of a district court, has ruled that the “doctrine of substantial compliance should not be allowed to spread beyond cases in which the taxpayer had a good excuse (though not a legal justification) for failing to comply with either an unimportant requirement or one unclearly or confusingly stated in the regulations or the statute.”

Tamulis’s charitable remainder trust flunks this test. The executor-trustee, represented by counsel, as he was, and well aware that a substantial tax deduction was at stake, had no excuse for failing to bring the required judicial proceeding to reform the trust. The requirement is not unimportant; it protects against efforts to bend trust law to get a tax benefit. Nor is the requirement stated unclearly or confusingly in the Code or in any regulation—it is perfectly clear. Until the trust was reformed, compliance with the spirit of the Code’s provisions dealing with charitable remainder trusts had depended largely on the good faith of the trustee.

When the conditions for applying the doctrine are not satisfied, it makes good sense to hold a taxpayer to the requirements of the tax code. The doctrine of substantial compliance “seeks to preserve the need to comply strictly with regulatory requirements that are important to the tax collection scheme and to forgive noncompliance for either unimportant and tangential requirements or requirements that are so confusingly written that a good faith effort at compliance should be accepted.” The doctrine is therefore inapplicable to this case.

Do you think you qualify to have the doctrine of substantial compliance apply to you? Speak with a California tax attorney and call Mitchell A. Port at 310.559.5259.

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The California State Board of Equalization has promulgated a rule that grants to registered domestic partners certain property tax relief afforded to spouses. County assessors (including the assessors of Los Angeles County, Ventura County, Santa Barbara County and Orange County) unsuccessfully challenged the rule in the trial court and appealed, arguing that it was unconstitutional. The California State Court of Appeal disagreed (you may read the opinion here).

In 1978, California voters adopted Proposition 13, a constitutional amendment, which limits the amount of ad valorem tax assessed on real property unless there has been a “change in ownership.” After the California Legislature defined such a change of ownership to exclude, among other things, real property transfers between spouses, the voters adopted Proposition 58, placing the spousal transfer exclusion in the state Constitution. The California State Board of Equalization then promulgated a rule excluding from the definition of change of ownership a transfer of real property to a registered domestic partner via intestate succession upon the death of the person’s registered domestic partner. Thereafter, the California Legislature amended the statutory scheme to limit change of ownership by excluding any real property transfers between registered domestic partners from the reassessment of full cash value for property tax purposes.

Plaintiffs, who are California county assessors, filed an action for declaratory relief, asserting that neither the Legislature nor the California State Board Equalization had the authority to create the registered domestic partner exclusion from classification as a change in ownership.

As California State Court of Appeal explained, the trial court correctly held (1) the Legislature can create an exclusion from “change in ownership” for registered domestic partners, without violating the California Constitution, (2) when the Legislature amended provisions of the Family Code and Revenue and Taxation Code, it ratified the Board’s rule excluding certain real property transfers between registered domestic partners from the property tax reassessment provisions of Proposition 13, and (3) accordingly, the Board’s rule is not unconstitutional.

For estate planning and probate help involving domestic partnerships and other matters, please call Mitchell A. Port at 310.559.5259.

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On March 30, 2005, the Tax Court ruled that a decedent’s transfer of real property to a family limited partnership (“FLP”) and later FLP gifts were includable in the decedent’s estate under Internal Revenue Code Section 2036(a)(1) which recaptures in a decedent’s gross estate certain assets transferred while alive. The Estate appealed. On September 14, 2007, the Ninth Circuit upheld the Tax Court’s decision. Read the Ninth Circuit opinion here.

Virginia Bigelow, the decedent, transferred her 98.3% interest in a single family residence to a trust (“Trust”). (The decedent’s children held the other undivided interests.) The trustees of the Trust were Virginia and her son. The following year, the parties exchanged the property held by the Trust for another rental residence (“Property”) and bought out the children’s undivided interests. Two years later, the Trust and the decedent’s children formed the FLP. The Trust contributed the Property to the FLP and the children each contributed $100. The Trust was the sole general partner. Over the next three years, numerous gifts of FLP interests occurred. At decedent’s death, the decedent owned a 44% limited partner interest in the FLP and her Trust held the sole one percent general partner interest. The 44% limited interest was valued at a 37% discount from the underlying appraised value and the one percent general partner interest was valued at a 35% premium.

In addition, the loans on the Property were retained as liabilities by the decedent. However, the Property served as the ultimate collateral for the loans. Because the decedent was left with insufficient funds to pay off the loans, the Partnership distributed funds necessary to service one of the two loans. No other distributions were made. After Ms. Bigelow’s death, a reduction in her Partnership capital account was made to reflect the loan payment distribution.

The Estate appealed the Tax Court’s decision arguing there was no “implied agreement” for the decedent to use, enjoy or have the right to the income of the Property and that the transfers were completed under the “bona fide sale” exemption of Internal Revenue Code Section 2036.

The Ninth Circuit affirmed the Tax Court’s deficiency determination, finding that Ms. Bigelow and the Bigelow children had an implied agreement that Ms. Bigelow would retain income and economic enjoyment from the transferred asset, and that the inter vivos transfer was not a bona fide sale for adequate and full consideration under Internal Revenue Code Section 2036(a).

To discuss putting an effective family limited partnership in place, please call Mitchell A. Port at 310.559.5259.