Notes on Trusts and Estates Law
Trusts and Estates
Medilin Spring 2006
Intro and Intestacy
1) Power to Transmit property at death- Dead hand Control a) Estate and gift taxes as method of restriction i) redistributes some wealth and attempts to break up accumulations of large wealth ii) gift tax prevents the use of inter vivos transfers to get around inheritance restrictions iii) spousal deduction- can give as much as want to spouse during life and at death iv) charitable deduction- also allowed to give away at death and during life v) annual exclusion amount- amount that can give to as many people as you want with no taxable effect 1) could give up to $12,000 each to all your friends and nobody pays taxes b) Right to Inherit and Right to Convey i) right to inherit recognized before right to devise ii) laws regarding wills and such are totally creatures of local law iii) idea of letting property go to children has strong base in ideas of self preservation and preservation of your offspring iv) Irving Trust Co. v. Day- Supreme said that states controlled laws of inheritance and could do with them what they wanted v) more property in US passes by types of inter vivos transfers that serve the same function as wills- joint tenancy, gift of remainder interest, reserving a life estate c) Two main options for a persons belongings at death are either honoring their wishes or confiscation by the government d) Problem of the Dead Hand i) if your restriction is trying to do a good thing then this will be looked at more kindly than a restriction for spite 1) normally ok to base restrictions on personal habits ii) when you do something with your property while you are alive you directly feel the affects of that but if you do it after death someone else feels the effect 1) being able to destroy something at death- arguments for and against a) society has great interest in keeping
Medilin Spring 2006
Intro and Intestacy
1) Power to Transmit property at death- Dead hand Control a) Estate and gift taxes as method of restriction i) redistributes some wealth and attempts to break up accumulations of large wealth ii) gift tax prevents the use of inter vivos transfers to get around inheritance restrictions iii) spousal deduction- can give as much as want to spouse during life and at death iv) charitable deduction- also allowed to give away at death and during life v) annual exclusion amount- amount that can give to as many people as you want with no taxable effect 1) could give up to $12,000 each to all your friends and nobody pays taxes b) Right to Inherit and Right to Convey i) right to inherit recognized before right to devise ii) laws regarding wills and such are totally creatures of local law iii) idea of letting property go to children has strong base in ideas of self preservation and preservation of your offspring iv) Irving Trust Co. v. Day- Supreme said that states controlled laws of inheritance and could do with them what they wanted v) more property in US passes by types of inter vivos transfers that serve the same function as wills- joint tenancy, gift of remainder interest, reserving a life estate c) Two main options for a persons belongings at death are either honoring their wishes or confiscation by the government d) Problem of the Dead Hand i) if your restriction is trying to do a good thing then this will be looked at more kindly than a restriction for spite 1) normally ok to base restrictions on personal habits ii) when you do something with your property while you are alive you directly feel the affects of that but if you do it after death someone else feels the effect 1) being able to destroy something at death- arguments for and against a) society has great interest in keeping