Hello from the Chair Scott M. Nelson
Happy holidays to all Section members. Hopefully your 2013 is coming to a successful conclusion. You will see our upcoming events highlighted below, including the CLE which is being co-sponsored with other sections and will be presented on December 12. Shane Swanson of our Section will have a presentation featuring the tax and estate planning aspects of same-sex marriage.
Our Section has continued to move forward with the Uniform Trust Code proposal, and we continue to welcome input as it proceeds through the legislative process. November 14 was “Give to the Max Day” and, as many of you have heard, a record $17 million was donated from more than 52,000 donors, including over $2,000 to the Wills for Heroes program. Thanks to all who contributed.
On November 18, our Section sponsored a panel discussion on recent litigation developments. The presentation included an overview of the litigation-oriented sections of the Uniform Trust Code, potential issues with the new statutory short form power of attorney (effective January 1, 2014), and an overview of interesting case law developments over the last year. Some of the cases featured included Gapinski v. Gray Plant dealing with statute of limitations issued by the Hennepin County District Court on October 8, 2013; In the matter of the Pamela Andreas Stisser Grantor Trust dealing with exoneration and PR compensation, 818 N.W. 2d 495 (Minn. 2012); Fannie Mae v. Heather Apartments Limited, 811 N.W. 2d 596 (Minn. 2012) dealing with judgment debtor’s interest in trust property; In re Estate of Holmberg, 823 N.W. 2d 875 (Minn. Ct. App. 2012) regarding a Will contest and competing probate petitions; and In re Spencer Irrevocable Trust, a December 10, 2012, Appellate Court Decision dealing with a testamentary power of appointment.
Interestingly, as we move forward with our trust legislation at the state level, there is increasing scrutiny of trust law at the national and international level as the result of recent efforts to strengthen tax compliance and transparency. For example, there has been some effort to require trusts and foundations to “register” as companies do, disclose actual and potential beneficiaries, expand the obligations of trustees and beneficiaries for reporting disbursements or benefits, and comply with the tax laws. Look for further development in this area.
Additionally, look for further luncheon CLEs sponsored by our Section this spring. As mentioned last month, mark your calendars for our annual Probate and Trust Conference to be held June 2 and 3, 2014. Also consider submitting articles on substantive law to our newsletter editors, or feel free to contact any committee chairs for areas in which you may be interested in participating as a volunteer.
Thank you for your support of our Section and let us know of issues that may need attention by our Section.
Wills for Heroes
Thank you to everyone who donated to the Wills For Heroes program on Give to the Max Day. As mentioned above, the program received over $2,000.00 in donations. The Minnesota Wills For Heroes program is now part of the Minnesota State Bar Foundation, a 501(c)(3) nonprofit corporation (originally it had fallen under the Minnesota Volunteer Attorney Program (MVAP)). If you would like to make a donation to the program, you can do so by sending a check to the Minnesota State Bar Foundation at 600 Nicollet Mall, Suite 380, Minneapolis, MN 55402. Be sure to note “Wills For Heroes Donation” in the memo of your check. You can find more information on how to donate at: http://www2.mnbar.org/willsforheroes/Donate.asp
The Wills For Heroes program continues to welcome new volunteers. The next attorney volunteer training program is on Wednesday, January 29, 2013.
To sign up for the training program or for more information, please contact Andrea Bischoff (firstname.lastname@example.org) or Susan Link (email@example.com) or visit http://www2.mnbar.org/willsforheroes/index.asp.
Upcoming Events and CLE Programs
- Greater MN Probate & Trust Study Group Conference Call
- Wednesday, December 18, 2013 at 9 a.m.
- Call-in Number: (800) 406-9170 passcode: 1491722
- Contact either Bradley Hanson (320-251-1414 ext. 1119) or JoEllen Doebbert (320-763-7838) with any questions or to join the group.
- MSBA Probate & Trust Law Section Monthly Meeting
- Thursday, December 19, 2013 at 3:30 p.m.
- Location: MSBA Offices
- Call-in Number: (800) 406-9170 passcode: 1491722
Federal & Minnesota State Tax Update
There are no updates to report this month.
Minnesota Trust Residency Tax Planning
By: Carl Petterson
Sawmill Trust Company
Similar to the tax that states impose on the income of its resident individuals, most states impose a tax on the income of trusts. Differing state income tax laws and the increasing complexities of trusts can potentially cause them to be taxed in multiple states. When this occurs, some trusts can elect to be taxed in more favorable jurisdictions.
States typically impose income tax on trusts in two circumstances: the first is when the trust is considered a “resident trust” and the second is when the trust is considered a “nonresident trust,” but has state-specific income. When a trust is considered a resident trust, all the income from the trust is taxed by the state because the trust avails itself of the many services, benefits, and protections afforded by that state. Nonresident trusts are taxed on state-specific income, called source income, when income is generated from real property, tangible personal property, or business interests within that state. A credit is typically given by a state for taxes paid to other states to prevent double taxation (but not always). Read more.
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