NEWS AND COMMENTARY

Published on: March 22, 2009

Can Killers Inherit from Their Victims?

Have you ever wondered whether someone who murders another person can inherit from their estate? In years past, there have been several California cases where children have murdered their parents, sometimes for money, as was alleged in the famous Menendez case in Los Angeles. Two brothers, Eric and Lyle Menendez, were tried and convicted of murdering their parents in 1989 to inherit what they thought was a $14 million estate. As it turned out, after taxes, loans, and costs of defense, they each would have inherited only about $ 2 million each. They were prevented from inheriting their parents’ estate.

The California Probate Code Section 250 has a section that provides that a person who “feloniously and intentionally kills the decedent” is not entitled to “any property, interest, or benefit under a will of the decedent or a trust…” This would also include life insurance proceeds or assets left to the killer as a designated beneficiary. You may remember Scott Peterson who was convicted of killing his wife. He was prevented from receiving benefits from his wife’s insurance policy.

All states in this country have similar laws to prevent someone who kills another from inheriting from the victim of their crime. In addition many states have adopted laws to make it difficult for convicted killers to sell their story and keep the money for themselves. These so-called “Son of Sam” laws came from the case where serial killer David Berkowitz, nicknamed the Son of Sam, was planning to profit from the sale of his story. California passed a “Son of Sam” law in 1986 prohibiting felons from profiting from their crimes. This law was struck down in 2002 as being unconstitutional. Today “Son of Sam” laws are sometimes put into plea bargains to provide that any profits from book deal or movies will go to the U. S. Treasury. Another remedy for victims is that they can sue their perpetrators in civil court, as in the O.J.Simpson case, and obtain a judgment which would be satisfied by book and movie profits.

Published on: March 12, 2009

Extension for Filing and Paying Tax Returns

by Scott C. Soady

Some people need extra time to file a personal tax return or an estate tax return. On your personal income taxes, you can apply for an automatic extension to file but it doesn’t extend the time to pay. You will have to pay a .5% per month penalty for late payment.

With the payment of estate taxes, you can also apply to receive a 6 month extension. The extension provided for in IRS Form 4768 is automatic. You will automatically receive an extension to file for 6 months however be aware that an extension of time to file is not an extension of time to pay the taxes. An extension of time to pay is discretionary.

One executor and trustee of an estate found this out the hard way. In a court case entitled Baccei v. United States, a trustee of a revocable living trust hired an accountant to prepare the Federal estate tax return. The accountant filed Form 4768 requesting a 6 month extension of time to file the return. Part of the form contains a section for an explanation as to why the estate needs more time to pay the tax and the number of months requested, up to 12 months. The accountant did not fill out that part of the form. Within 6 months, the accountant filed the return and paid the estate tax. The IRS then assessed a late penalty on the estate tax paid which had been approximately $1 ½ million. The Trustee appealed.

Published on: March 6, 2009

Interesting Issue Over Health Ledger’s Oscar

by Scott C. Soady

As San Diego estate planning attorneys, we at Law Office of Scott C. Soady, A Professional Corporation, have been following the story of Heath Ledger as it related to his estate plan. You may recall that he had a will leaving his estate to his parents and siblings and then later had a daughter Matilda. His family decided that even though the will made no mention of children, they would give his entire estate, estimated to be about $20 million, to Matilda. Now another interesting aspect:

At the recent Academy Awards, Heath Ledger posthumously received an Oscar for Best Supporting Actor for his role in the Dark Knight. There was some controversy before the Awards as to who would become “Oscar’s” owner. The director of the academy, Bruce Davis, said it was complicated because there was the issue of who would accept the award and then who would keep the statute. According to the Academy’s tradition, when an award is given posthumously it usually goes to the spouse or to the oldest child if there is not spouse. Health Ledger wasn’t married and his daughter is only 3 years old. Being 3, Matilda would not be able to sign the “winner’s agreement” which is a contract between the Academy and the winner that the winner will not sell the Oscar without first offering it back to the Academy for $1.00. The whole issue was resolved by deciding to give the statue to Matilda but her mother Michelle Williams will be the legal custodian. When Matilda turns 18, she can sign the agreement on her own behalf and then she will be legally bound not to sell the statue.

Published on: March 3, 2009

Conservatorship for Actor Peter Falk?

by Scott C. Soady

In December 2008, Peter Falk’s daughter petitioned the court in Los Angeles county to become the conservator of her father. Falk, noted for his role of Columbo on TV, has apparently been diagnosed with Alzheimer’s disease and dementia. His daughter Catherine claims her father requires full time custodial care for his health and safety and is unable to take care of his finances. The Los Angeles court appointed an attorney to evaluate Falk who has filed a report saying there is no grounds for a conservatorship. Falk’s wife of 32 years also opposes the conservatorship.

Conservatorships are probate proceedings where a judge appoints a responsible person called a conservator to care for another adult who cannot care for himself or herself or handle his or her finances. Any person who wants to be a conservator can petition the court to become the conservator. Usually it is the individual’s spouse or other relative although it can be a friend or even a state or local agency. The court will not grant a petition for conservatorship if there are other ways to meet an individual’s needs such as with a durable power of attorney, a spouse that can handle the care and finances, or a revocable living trust in place.

It will be interesting to see what the L.A. probate court does in the case of Peter Falk. Another hearing on the matter will be held soon. If you have questions about conservatorships or how to avoid them, call the experienced estate planning lawyers at Law Office of Scott C. Soady, A Professional Corporation for a complimentary consultation.

Published on: February 2, 2009

Silver Alert in California Would Help Seniors with Dementia

by Scott C. Soady

If you have a family member suffering with a form of dementia or Alzheimer’s disease, you probably worry about them wandering away. The Alzheimer’s Association estimates that 60% of dementia patients will wander at some point in their life. A new law is being proposed in California to institute an alert, similar to the Amber Alert, when seniors with dementia go missing.

The program is called a Silver Alert, modeled after the Amber Alert system to locate missing children. Last year the U.S. House of Representqtives passed the National Silver Alert Act to establish a formal public notification when a senior citizen is missing, however the Senate failed to approve a similar measure.

In spite of the lack of federal legislation, about a dozen states have adopted Silver Alert Acts. Florida, which has the largest population of senior citizens, adopted the plan in October 2008 and had success in finding all the seniors who went missing during the rest of 2008.

Published on: January 19, 2009

Obama to Keep 2009 Estate Tax Level

by Scott C. Soady

Last week the Wall Street Journal reported that President Obama wants to freeze the current estate tax level to $3.5 million which is the estate tax exemption amount for 2009. Currently only estates with more than $3.5 million ($7 million for couples) have to pay estate tax. Obama intends to set forth his estate tax proposal in his budget next week. If the legislation is passed by Congress it will mean that the estate tax which was set to expire in 2010 would remain at $3.5 million.

The estate tax was enacted in the early twentieth century as a levy on wealth and inherited assets. It was later modified to provide that one spouse could leave an estate of any amount to the other spouse without any tax. In 2001 under President George W. Bush, Congress approved a gradual increase in the amount of the estate tax exemption with a total repeal in 2010, only to have the estate tax return in 2011 with an exemption amount of $1 million.

With the estate tax level set a $3.5 level, it is estimated that less than 2% of all deaths in this country will result in the payment of estate taxes. The vast majority of us do not have to worry about our heirs and beneficiaries having to pay estate taxes. That does not mean however that we don’t need estate planning. Even if taxes are not an issue, most people need to create a revocable living trust to avoid probate and insure that their estate is distributed to their beneficiaries on the terms they specify. If we can help with your estate plan, call us or email us at Law Office of Scott C. Soady, A Professional Corporation.

Published on: November 24, 2008

Could You be the Victim of Identity Theft?

by Scott C. Soady

The holiday season in San Diego has many people going to the local malls and retail stores. Identity theft is on the rise and occurs more frequently over the holidays. Identity theft occurs when someone uses your name, social security number or other personal information to commit fraud. It is estimated by the Federal Trade Commission that as many as 9 million Americans have their identity stolen each year. The San Diego based Identity Theft Resource Center estimates 15 million Americans have their identity stolen each year and California is one of the top states for identity theft. Identity theft is committed in a variety of ways such as stealing your purse or wallet, going through your trash, phishing, skimming, or using false pretenses to obtain your personal information.

Here are some signs that you might be at risk to have your identity stolen:

1. You carry your social security card in your purse or wallet.

Published on: November 17, 2008

November is Alzheimer’s Awareness Month

by Scott C. Soady

According to the Alzheimer’s Association, there are an estimated 5 million Americans suffering from Alzheimer’s disease. Fortunately, San Diego has a lot of resources for families living with the disease. The George G. Glenner Alzheimer’s Family Centers is one resource that helps families with adult day care, respite programs, and support groups. The Southern California Caregiver Resource Cener also provides assistance in the form of support groups, seminars, respite care, etc. Information on geriatric care managers is available through the National Association of Professional Geriatric Care Manager’s Association.

Alzeimer’s eventually results in disorientation, memory loss, cognitive dysfunction, and inability to take care of oneself and one’s finances. Planning ahead can be vital for family members caring for the Alzheimer patient. Once the individual loses the capacity to make financial decisions, it is too late to execute important documents like powers of attorney and wills or trusts. All such documents require that a person have the ability to understand what they are signing and the legal effect of signing the document. If a person becomes incapacitated before someone can be named to make important decisions, the only alternative may be a conservatorship which is costly, requires court approval, and takes time.

If you are coping with a person who has Alzheimer’s or any other type of dementia, take advantage of all the resources available. Contact us at Law Office of Scott C. Soady, A Professional Corporation if we can help with powers of attorney or other legal documents to enable other individuals to take over health care and financial decisions when the person becomes unable to do it personally.

Published on: November 13, 2008

Help is a Click Away!

by Scott C. Soady

If you live in San Diego, there is a lot of free information available to you on a variety of legal issues. Here are some “clicks’ that may answer many questions you have:

1. Our website at Law Office of Scott C. Soady, A Professional Corporation has many articles in the area of estate planning and divorce. Our estate planning blog has current postings as well as archived postings going back to 2002.

2. The San Diego County Clerk/Recorder’s office has information on its website about recording documents and you can also download samples of commonly used forms such as affidavits of death, grant deeds, quitclaim deeds, property tax exemption forms, and preliminary change of ownership forms. You can access information about your property tax bill or download an application to lower your propery taxes. You can also check the Grantor/Grantee index online for deeds and other recorded documents and order copies on line or pick them up at one of the offices in Kearney Mesa, San Marcos, downtown, Chula Vista, or El Cajon.

Published on: November 8, 2008

Same Sex Estate Law and Family Law after Passage of Prop 8

by Scott C. Soady

Most counties in California including San Diego have suspended the issuance of marriage licenses for same sex couples after California voters passed Proposition 8 on Tuesday. Proposition 8 amends the California constitution to limit marriage to a union between a man and a woman.

Back in May of this year, the California Supreme Court ruled that such a ban was unconstitutional. Approximately 18,000 marriages have taken place between June when the decision became final through November 4. What happens to the validity of those marriages? California Attorney General Jerry Brown has said that since the amendment will not be retroactive, those marriages will be valid. He also has indicated the State will defend the validity of those marriages in court if they are challenged.

Expect there to be legal challenges to the Proposition. Attorney Gloria Allred, who filed the original suit that resulted in the Supreme Court ruling, has in fact already filed a lawsuit on the basis that the amendment authorized by the passage of Prop 8 is unconstitutional. A coalition of gay rights advocacy groups and the American Civil Liberties Union have also petitioned the California Supreme Court. Some pundits believe the issue may go all the way to the U.S. Supreme Court.