On May 8, 2024, the Internal Revenue Service proposed long-awaited regulations relating to foreign gifts and foreign trusts. These proposed regulations largely implement a notice dating back to 1997 and have likely been proposed because of recent developments in which notices have been invalidated for failure to comply with the Administrative Procedures Act requiring public notice and an opportunity for the public to comment (and have those comments carefully considered).
On July 8, the Section of Taxation of the American Bar Association submitted extensive comments on the proposed regulations. Michael Karlin was an active participant in the preparation of the comments. In addition, Michael submitted his own separate comments on the proposed regulations. Both sets of comments are available in the Publications section of our website.
Click here to read Michael Karlin’s letter to the Internal Revenue Service.
Karlin & Peebles has again been recognized as a leading International Tax firm in the newly-released 2024 US edition of The Legal 500, highlighting the firm’s eminence in advising high-net worth individuals and their closely held businesses on matters related to foreign investment planning, philanthropy, tax compliance, and controversies. This year’s edition also recognizes name partner Michael Karlin as a recommended leading lawyer in International Tax.
In a testimonial given to The Legal 500, Karlin & Peebles is said to be filled with “Exceptionally intelligent and informative lawyers. Ability to think outside the box. Exceptional analytical skills. Exceptional communicative skills. An in-depth knowledge of the law. Energetic, enthusiastic and down to earth.”
The Legal 500 US is an independent benchmarking guide widely considered to be a definitive voice on law firm excellence. Each year, The Legal 500’s team of research analysts conducts exhaustive research into individual firms in conjunction with recommendations received from clients and peers and uses this data to produce a comprehensive report on legal services providers in the US market.
Jennifer Campbell recently spoke to Wealth Management about a lawsuit filed by the children of late musician Robbie Robertson of the Band accusing his widow, Jane Zuccarini, of fraud and financial elder abuse. The couple secretly wed just months before Robertson died in 2023. Following his death, Zuccarini inherited a residence purchased in both of their names, and allegedly bragged to his two daughters about changes made to his estate plan that would cover her living expenses at the Beverly Hills home from the children’s inheritance. His children claim that Robertson’s battle with cancer rendered him unable to make such decisions and that Zuccarini was well aware of his condition.
When asked to describe what it would take for Robertson’s children to prevail in the lawsuit, Jennifer shares, “The burden of proof is carried by the plaintiff, and the level of certainty to which the plaintiff must prove the plaintiff’s case depends on the type of claims the plaintiff is making.”
She continues, “For example, if the challenge to the decedent’s estate planning documents is based on a claim of the decedent’s incapacity, then the plaintiff must submit evidence to the court that demonstrates by a preponderance of the evidence that the decedent lacked the necessary capacity to sign the decedent’s estate planning documents.”
Read the full article in Wealth Management:
Robbie Robertson’s Children Accuse Widow of Financial Elder Abuse
Karlin & Peebles is pleased to announce that highly skilled trust and estate planning attorney Jennifer Campbell has joined the firm as a partner. To this role, Jennifer brings more than three decades of comprehensive experience in domestic estate planning and trust and estate administration.
Jennifer skillfully helps clients develop estate plans, including drafting revocable and irrevocable trusts, assigning powers of attorney and healthcare powers, and transferring assets into trust. When plans mature, Jennifer leverages her extensive estate administration experience to ensure the process goes smoothly, from reviewing documents and assets to determining whether an estate tax return is necessary or desirable, making arrangements for that return, and assisting the trustee with beneficiary communications. Her impressive breadth of experience and deep relationships with her clients allows her to construct and draft estate plans that avoid traps for the unwary and successfully guide fiduciaries through the administration process. She works seamlessly with clients’ existing teams of advisors to develop and carry out legacy plans that are strategic, tax advantageous, and befitting of each client’s unique goals.
Please join us in welcoming Jennifer to the firm!
The firm is proud to sponsor the 16th Annual STEP LA International Tax & Estate Planning Forum: 2024 Global Odyssey. This year’s forum will take place at the Terranea Resort in Rancho Palos Verdes, California from June 13-14, 2024.
Michael Karlin will be a featured speaker on the panel, “Pied-á-Terre Somewhere,” which will provide guidance on cross-border acquisitions of property for global families with homes in multiple jurisdictions.
Click here to learn more about the forum and register.
On Thursday, May 23, 2024, at 12:00 PM EDT, Michael Karlin will be presenting the STEP Mid Atlantic Webinar “Dissecting the Proposed Foreign Trust Regulations” alongside Rosy L. Lor of BDO, Kevin E. Packman of Holland & Knight, and Melissa L. Wiley of Lowenstein Sandler. The webinar will review the latest IRS and U.S. Department of Treasury proposed regulations under IRC 643(i), 6039F, 6048, and 6677, which provide guidance on U.S. taxpayers’ U.S. federal tax obligations for foreign trusts and foreign gifts under those provisions, and their implications for taxpayers.
To register for the conference, click here.
Cynthia D. Brittain recently weighed in on a reader’s question in MarketWatch’s “The Moneyist” column where the letter writer asks how to gift her niece and nephew part of an inheritance while avoiding gift taxes and other costs.
The column explains that breaking up annual gifts under the federal gift tax exclusion allows you to gift installments of $18,000 not only to each recipient, but to each of their spouses and children while remaining exempt from gift taxes. As another solution, Cindy tells MarketWatch that in addition to making gift payments in installments, one can pay tuition expenses directly to the recipient's university or school, which would not count as a gift and therefore would not be taxed.
“Higher education payments do not trigger any type of gift tax reporting,” Cindy shares. “The same applies for medical expenses as long as payments are made directly to the medical facility, if that is relevant or applicable.”
Read the full article as published MarketWatch (Subscription may be required):
Cynthia D. Brittain recently weighed in for a column in MarketWatch’s “The Moneyist” addressing a reader’s question about whether an attorney is needed during the probate period to transfer an inherited property into their name and the names of other beneficiaries.
Though the reader’s home state of Ohio doesn’t require that an attorney be hired for the probate process, Cindy strongly encourages seeking professional advice, noting that filing without an attorney could result in further problems. “Each jurisdiction is unique, and the tax implications are too significant to risk getting it wrong,” she tells MarketWatch. “A couple of hours of professional advice is well worth it in most cases.”
Read the full article in MarketWatch (subscription may be required):
On Thursday, March 21, 2024, Cynthia Brittain will be presenting at the California Lawyers Association’s 2024 Estate and Gift Tax Conference. Her presentation, “The Supercharger QDOT,” will move past basic QDOT provisions and will explore advanced strategies to ensure flexibility between income distributions versus unitrust treatment.
To register for the conference and learn more, click here.
Cynthia D. Brittain recently spoke to Wealth Management about the trend of wealthy clients gifting larger amounts to charity, in light of Ruth Gottesman donating $1 billion to the Albert Einstein College of Medicine in the Bronx, N.Y.
“It is wonderful to witness such generosity,” Cynthia tells Wealth Management. “Wealthy clients today are considering larger and larger gifts to charity, and in practice, I see these gifts as being most impactful when contributed during the donor’s lifetime so that they can comment. It helps stir the trend,” she explains.
“We expect to see more large gifts to trust and large gifts to charities in the coming year,” she added.
Read the full article in Wealth Management:
A Lesson in Understated Generosity
Michael Karlin will present “Aroeste v. the United States: Limits on Government Authority Re: Tax Treaty Law” at The University of San Diego School of Law – Chamberlain International Tax Institute. The presentation will be held in Mérida, México on February 19, 2024.
Michael Karlin will present “Home Away From Home: Nonresident Ownership of U.S. Homes” at the American Bar Association Tax Section Midyear Tax Meeting with Sabrina N. Conyers from McGuireWoods LLP. The presentation takes place at the Hyatt Regency in San Francisco, California on January 19, 2024.