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Semmes Legal Articles

Semmes offers articles, relative to different areas of law, for information-purposes only. Semmes assumes no responsibility for the accuracy or timeliness of any information provided herein. The articles and information may not apply to your unique situation, and are not intended to be used as a basis for any particular course of action or as a substitute for legal advice.

Here Is Your Will – Do You Want Tax Planning To Go With That?

May, 2016 | By Carl E. Eastwick

These days only a few wealthy families will pay the federal estate tax. But for residents of Maryland, the state estate tax may perplex people planning to pass on more modest wealth. Since the federal and Maryland estate tax systems will be out of phase until 2019, estate planners should contemplate crafting special Maryland-only provisions into plans until the tax laws are again in synch.

For most people, the federal estate tax is dead! If you die this year, 2016, your family and friends will not have to deal with the IRS’s “Death Tax” unless you have more than $5,450,000 to leave to them. Only a handful of the U.S. citizens dying each year have taxable estates larger.

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Where There’s a Will There’s a Way

February, 2016

Imagine if the state of Maryland planned your funeral. Your loved ones could gather in a state-run funeral chapel under the hum of florescent lights. Amid plastic chrysanthemums and piped-in organ music, you would be eulogized by a state employee who had never met you. With little to go on, he could speak favorably of your diligence in paying your taxes and avoiding incarceration. Then your remains would be conveyed to a public cemetery and interred beneath a marker bearing the identifier by which the state knows you best—your Social Security number.

How does that sound? Like a Las Vegas wedding, this scenario may have a certain kitsch appeal, but most of us would prefer something a bit more personal. Fortunately, the state won’t plan your funeral, even if you fail to do so. But if you die without a Will, it will plan your estate, and the results can be just as regrettable.

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Living Trusts—Panacea or Pandora’s Box?

January, 2016

Revocable living trusts have been marketed so successfully that many people think they can’t live—or die—without one. The promises of avoiding probate, ensuring privacy, and preparing for incapacity seem too enticing to pass up. Suze Orman, the popular financial guru, goes so far as to say that “everyone” needs a revocable living trust. But what everyone really needs is some good advice. Living trusts can be useful in limited circumstances, but most of us are simply better off without one. A revocable living trust is essentially a substitute for a Will. Rather than having your estate administered through probate, you would retitle your assets in the name of a trust created for this purpose. Because the trust is revocable, you can amend or revoke it as necessary during your lifetime. Upon your death, the trust becomes irrevocable and your trustee simply distributes the assets to your beneficiaries. Time is saved, costs are minimized, and probate is avoided. What’s not to like?

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