IRC Section 67 Regulations Deferred

Posted on by July 17, 2014

As previously reported, the IRS has published final regulations on the expenses of estates and trusts that are subject to the 2% floor for miscellaneous itemized deductions.  T.D. 9664, 79 F.R. 26616 (5/9/2014)

These final regulations require estates and trusts that pay a single “bundled fee” must allocate that fee between expenses that are subject to the 2% floor and expenses that are not.  Treas. Reg. § 1.67-4(c).  These final regulations are applicable to fiscal years beginning on or after May 9, 2014, and so would apply to most existing estates and trusts beginning January 1, 2015, but would apply to new estates and trusts immediately.

In response to comments, and in order to give fiduciaries more time to “unbundle” their fees, the IRS has amended the final regulations to apply only to taxable years beginning after December 31, 2014.

T.D. 9664, 79 FR 41636 (7/17/2014).

Powers of Attorney after Act 95 (Part I)

Posted on by October 7, 2015

House Bill 1429, which makes a number of changes to the form and effect of powers of attorney, was signed by Governor Corbett on July 2, becoming Act 95 of 2014. The more important changes made by Act 95 include new requirements for witnesses and notarized acknowledgements, changes to the notice to the principal and the required acknowledgements by agents, new limits on the liability of third parties in order to reverse the reasoning of the Supreme Court in the Vine decision, new limits on the power of agents to make gifts and other estate planning actions, and a revision and restatement of the duties and liabilities of agents.

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Mercer Co. Administrative Orders

Posted on by July 2, 2014

Mercer County has entered three administrative orders:

1.  Administrative Order No. 1, Register’s No. 2013-767, 44 Pa.B. 24 (1/4/2014), directs the Register of Wills to notify judges each year whether or not the annual reports of guardians required by 20 Pa.C.S. § 5521(c) have been filed, and provides procedures for reviewing annual reports and for scheduling hearings to determine why reports have not been filed.

2.  Administrative Order No. 2, Register’s No. 2013-767, 44 Pa.B. 25 (1/4/2014), directs the Register of Wills to accept, file, and maintain a public index for, original wills that have been in the possession of lawyers who have died or otherwise ceased to practice law and who have been unable to return the wills to the testators.

3.  The third administrative order directs that administrative orders be kept available for public inspection in the offices of the Clerk, the Register of Wills, the Clerk of the Orphans’ Court, and the Prothonotary.  Administrative Orders, Register’s No. 2013-767, 44 Pa.B. 24 (1/4/2014).

Adoption and Inheritance Rights under the Wills Act of 1947

Despite the language of the Wills Act of 1947, which was in effect at the time of the testator’s death, if there is no contrary intent expressed in the will, “issue”, “child”, or “children” presumptively includes children that were adopted regardless of the date of adoption and includes those adoptees who were adopted as adults as long as a parent-child relationship existed between the adoptee and the adopter during the adoptee’s minority.    Armistead Trust, 4 Fid. Rep. 3d 233 (O.C. Delaware 2014) (Opinion by Kenney, J.)