As mentioned in my previous posts, 2013 also brings new taxes for high-income earners under the Affordable Care Act. Effective January 1, 2013, one of the significant taxes under the Affordable Care Act is the increase in Medicare taxes on W-2 or self-employment earnings for high-income earners (those earning more than $200,000 for unmarried taxpayers, $250,000 for married filing joint, and $125,000 for married filing separate taxpayers). Medicare taxes increase from 1.45% to 2.35% for W-2 wages above these thresholds. The employer does not have to match the increased tax on the taxpayer’s earnings. Self-employed taxpayers will now pay 3.8% on any earnings over these thresholds ((2.35% + 1.45% = 3.8%) rather than the previous 2.9% (1.45% x 2)).

Here is an example of how the new Medicare Surtax impacts high-income earners.

Sally is unmarried with W-2 earnings. She earns $250,000 during 2013, which is $50,000 over the threshold. Her employer will withhold 1.45% on the first $200,000, match the 1.45% and then withhold 2.35% (or an extra .9%) on all amounts over $200,000. However, her employer continues to pay the employer’s portion at 1.45%.

Earnings from multiple sources could result in taxpayers ending up owing money next April 15^th as a result of underpaid taxes. One solution to avoid underpayment of taxes would be for the taxpayer to ask the employer to withhold additional withholding taxes by completing Form W-4. For married couples, each person may want to ask their employer to withhold additional taxes if their combined income exceeds the threshold.

There are a few ways to reduce the Medicare Surtax such as:

• Reducing wages (typically, not a very realistic alternative),

• Making a contribution to a qualified retirement plan, or

• Contributing to a flexible spending account (up to $2,500), assuming this will be used.

Shifting the income to investment dividend income may not be a viable solution because the other significant tax that is part of the Affordable Care Act is the investment earnings surtax. The investment earnings surtax is 3.8% on investment earnings above $250,000 for married filing joint taxpayers. I will be discussing the investment earnings surtax in greater detail in an upcoming post.

Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

Capacity for our upcoming February 13^th Non-Member Webinar is filling up…. Over 200 registered so far! If you haven’t had the opportunity to register yet, we wanted to include some of the details for you.

The Webinar is intended for entrepreneurial attorneys interested in creating increased revenue and quality of life in 2013. It will be conducted by the founders of the Academy, Robert Armstrong and Sanford M. Fisch. These attorneys also co-authored the book, The E-Myth Attorney which will be given to all non-member attorneys registering for this Webinar.

This Webinar will help you discover:

• What’s really happening in your law practice and how it’s contributing to your current state of affairs (We’ll walk you through our simple attorney audit to help you discover where you are now, where you WANT to go and why you aren’t there yet, in a matter of minutes).

• The number one thing that comes between EVERY attorney and the next level of success they have their eye on. No matter how drastic the problem, we’ll show you how the solution is stunningly simple.

• The easiest way to maximize your income while working minimal hours.

• Highlights of the 11 Essential Systems to Dominate Your Market this year.

• How you can go deeper in your training at the 2013 American Academy Boot Camp in Philadelphia…and attend with absolutely NO-RISK and no obligation (details will be shared on the Webinar).

It’s easy to get used to working in your business rather than working on your business. This Webinar will help you take a step back to assess where you really are right now in order to change the trajectory of where you are going in 2013.

In addition to an eye-opening hour with Robert Armstrong and Sanford M. Fisch and a copy of The E-Myth Attorney, Webinar attendees will receive:

• Our exclusive Attorney Audit. We will use this resource interactively on the Webinar to help you start mapping out your course to success.

• A video recording of the Webinar so you can replay and watch again at your convenience (Can’t make the call live? Register anyway and we’ll still send you the recording).

Click here to register now – you’re just one step away from creating a blueprint for the law practice you always envisioned.

Kathryn Adams
Public Relations Manager
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

The Academy is all about systems that allow firms to be productive and efficient and therefore, profitable. One of the ways to ensure that law firm revenue goals are achieved is to incentivize staff so they also share in the firm’s continued growth and success. In fact, over the years, many Member firms have tied bonuses to performance or to a daily number revenue goal. There isn’t a “one-size-fits-all” approach for a bonus plan; every law firm is unique and the right bonus plan will focus on what’s important to them and their staff.

When setting up your own system, consider what areas you would like to see growth or improved performance. Those areas that you want to focus on are where you’ll want to set a bonus system around. Consider that each area of practice may need to have its own bonus structure. Why? If paralegals work on more than one area of the practice, you wouldn’t want to bonus them on estate planning and then have them ignore their other responsibilities because they aren’t tied to a bonus.

Here are some ideas for estate planning:

• If you want XX documents produced per month – then put that goal out there

• If you want XX signings per month – put that number out there

• If you want a Medicaid person setting up nursing home seminars – perhaps a number of Medicaid seminar attendees per month would be one of the goals for the firm

• If you want to increase endorsed seminars, then you could have a goal tied to it for a marketing coordinator or associate attorney

• If you want to increase client referrals – then you can set a goal for what percentage of new clients should provide you with at least 1 name

Some of these goals or objectives will require a team effort to complete. For example, if you have a goal of 20 new trusts a month (signed and final payment collected), then it requires a group or team effort to ensure that the goal is met. You can set up a bonus pool that everyone or some people participate in based on their responsibilities and your goals. The more they accomplish the more they earn. When all staff get the same bonus– they end up helping each other with the document, the seminar, the signing or whatever else needs to get done, because the more they get done the bigger ALL their bonuses are. This will ensure, for example, that a final signing paralegal jumps in to help the document production paralegal if necessary to make certain that the work is complete for 20 final signings to actually occur. You would need to have a particular dollar amount that you reserve for a bonus pool that everyone knows about and is in writing. They should feel like this goal is attainable but they should have to work for it, so it’s not just a handout. They also need to have a little taste of what it feels like to have the bonus money in their pocket. The more frequent the bonus is paid the more effective it is. Paying every month on the rolling average for the past three months looks after any weird odd-ball month in this effort.

If your bonus is paid quarterly be careful not to base it on a monthly goal that needs to be met for every month of the quarter. If you pay at the end of the first quarter: if they met the goal in January, then they get paid for that month; if they don’t meet the goal in February, then they don’t get anything for that month; but if they meet it in March, they get a bonus for their performance that month. This ensures that if they don’t reach the goal for one month, they continue to try and reach the goal the following month.

Also keep in mind that not all employees are motivated by money. For some the incentive might be extra time off to spend with their kids while they’re on vacation OR number of Fridays that they get off of work during the summer.

Lillian Valdez
Practice Building Consultant
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

As I discussed in last week’s blog, the fiscal cliff legislation, officially known as the American Taxpayer Relief Act of 2012 (“ATRA”) included increases in income tax rates for high-earners. For couples earning more than $450,000, the top ordinary income tax rate went up to 39.6% and the rate for long-term capital gains and qualified dividends went to 20%.

As I mentioned last week, in addition to the fiscal cliff changes, the 3.8% surcharge from “Obamacare” brings the new capital gains tax for high-earners in 2013 to 23.8% from only 15% in 2012. But, a Charitable Remainder Trust (“CRT”) can help.

Let’s look at an example:

Anne and Bob Client are both 65 and retiring next year. They have income of $575,000 in year 1. Thus, they would be taxed on any capital gains at 20% in 2012, plus the 3.8% Obamacare surtax. They had invested in Company A years ago. The stock is now worth $1 million and their basis is de minimus. If they sold the stock, they would have a capital gain of $1 million and would pay tax of $238,000. Also, their income would be boosted to $1.575 million and most of their deductions would be phased because of the “Pease” rules.

Instead, they could contribute the stock to a CRT. Let’s assume they are both age 65. If they received 10% of the value of the trust annually, the actuarial value of the contribution to the trust would be about $125,000. That would provide a real benefit to them in 2013, since they are in the 39.6% bracket and could take this deduction all in 2013 (less the Pease phase-out reduction of $8,200). Thus, the deduction would provide them a benefit of a tax bill that is $46,253 lower next April.

In addition, rather than paying $238,000 in tax, the distributions to Anne and Bob would be “flavored” by the income earned by the trust, essentially on a Worst In First Out or “WIFO” method. Let’s assume that the trust sells the stock and then reinvests for capital gains. Each year, as the couple receives their distribution, it will be considered capital gain income and taxed accordingly. But, it also has the effect of deferring the gain. Each year, about 10% of the gain is recognized for 10 years. A tax deferred is a tax diminished because of the time value of money. Moreover, when their distribution is received from the trust, it will be taxed at only 15% because they will be in a lower bracket at that time due to their diminished income in retirement. Thus, they’ve benefitted from the reduction in rate from 23.8% to 15%, in addition to the deferral.

Thus, a CRT can be a great solution for many clients with appreciated assets.

Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

Which television venue can better help start funeral planning conversations: reality TV or TV interviews? Yep, even funerals are fair game for reality TV, as you’ll find out.

TV interviews can get people talking about their own funeral services by bringing the conversation directly into their homes. The problem is, most news and talk programs won’t touch the subject.

That’s why A Good Goodbye TV, an educational and entertaining 12-episode series of 30-minute programs, will present expert interviews on “everything you need to know before you go.”

Each conversation on A Good Goodbye TV will illustrate my motto: Talking about sex won’t make you pregnant, and talking about funerals won’t make you dead. By planning ahead and having a conversation, families can reduce stress at a time of grief, minimize family conflict, save money and create a meaningful, memorable “good goodbye.”

It’s rare to see people talk knowledgeably about estate and funeral planning issues on television. Watching such a conversation enables families to discuss these topics and take action BEFORE there’s a crisis.

Topics to be covered include estate planning, funeral planning, cremation, cemeteries, managing costs, eco-friendly funerals, life celebrations, pet loss, end-of-life issues and much more.

The episode on estate planning will feature Jim Plitz, attorney with AAEPA member firm Morris, Hall & Kinghorn, P.L.L.C. The firm has offices in Phoenix, Tucson, Albuquerque and other communities throughout Arizona and New Mexico.

The program will initially air on public access channels in New Mexico, then be offered nationally to 2,700 content-hungry public access channels. Pay-per-view online downloads and DVDs will follow.

Compare intelligent conversation with “reality TV.” On January 6, the cable channel TLC debuted a pilot program Best Funeral Ever, focused on over-the-top celebratory funerals. It featured African-American “home-going” services produced by the Golden Gate Funeral Home in Dallas, TX.

Each funeral had a theme: a Christmas funeral for a man who loved the holiday season; a barbeque funeral for the singer of a jingle about baby back ribs; and a memorial service visit to the East Texas State Fair with the cremated remains of a man who loved the fair but couldn’t go on rides because he had spina bifada.

These colorful, activity-filled funerals were the opposite of traditional services. The funeral home staffers were creative, energetic and totally committed to serving their families. The families served were very happy with the results.

While participating in a live online chat with funeral directors watching the program, industry reactions were mixed. The pseudo-dramatic aspects of the program got the most negative reviews. Some funeral directors wondered about the dignity of the proceedings – especially the presence of live animals (two pigs at the barbeque funeral, 17 unusual manger animals for the Christmas funeral).

And yet, this program showed what an arrangement conference with a family in a funeral home actually looks like. Plus, it showed people truly celebrating the lives of those they loved.

If it takes a program like Best Funeral Ever to get people to talk about funeral planning, I’m all for it! But “reality TV” is not the only reality on television. What kind of TV do you think your clients would prefer for starting a funeral planning conversation?

You can learn more about A Good Goodbye TV here: http://agoodgoodbye.com/a-good-goodbye-tv-series/

Gail Rubin, The Doyenne of Death^®, is author of the award-winning book, A Good Goodbye: Funeral Planning for Those Who Don’t Plan to Die and host of the new television interview series, A Good Goodbye TV. She speaks to groups using clips from funny films to illustrate funeral planning issues and help start serious conversations. Her website is www.AGoodGoodbye.com.

Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

Attention Attorneys! If you are NOT a member of the Academy, here is a list of action items that we released to members relating to the recent tax law changes. You may want to consider updating certain materials. If you have any questions about anything specific, email us at info@aaepa.com.

The New Year rang in significant changes with the American Taxpayer Relief Act. The biggest change was the repeal of the sunset provision on the existing law, as well as a few other items. The Education and Marketing departments are busy updating our most frequently used seminars, handouts, tax law insert for handouts (available later this week), Academy Reports, etc. to incorporate these changes and highlight the planning opportunities that exist now.

Changes in the Law

Regarding federal estate taxes, this new law makes almost all of the previous tax provisions, commonly known as ”TRA 2010,” permanent, with the exception of the tax rate. This means there is an estate tax exclusion of $5 million that will be adjusted for inflation. So for 2013, the exclusion is $5.25 million. The estate tax is coupled with the gift tax and the “unified” exclusion can be used either after death or while the person is still alive, just like under TRA 2010. The tax rate is now capped at 40%, instead of the prior 35%.

The “portability” provision from TRA 2010 is also retained. This means that the estate tax exclusion amount of the first spouse to die may be used by their surviving spouse, assuming an estate tax return is filed for the pre-deceasing spouse.

Regarding state estate taxes, as with the prior law, they remain deductible rather than a credit (as was the case many years ago).

The Generation Skipping Transfer Tax (GST) exemption is set at $5 million and is also adjusted for inflation. As in the prior law, the GST exemption is not portable. Thus, the use of GST exemption, along with remarriage protection, asset protection, etc., are reasons to continue using credit shelter trusts in appropriate cases.

The new law affects everyone’s income taxes. The existing rates on incomes below $400,000 (single) and $450,000 (married, filing joint) have been set permanently to the current level. For incomes over that amount, the rate will increase from 35% to 39.6%, where it was before 2001. In addition, this income bracket will see a raise in qualified dividend and capital gain income tax rates from 15% to 20%. Those tax rates will not change for lower income amounts.

When it comes to “charitable rollover” IRAs, those provisions will be extended for 2012 and 2013 only. This means that an individual over age 70 ½ can give up to $100,000 from their IRA without taking that amount into income. For clients making large charitable gifts from an IRA, this is good news because the deduction for a normal contribution, without the benefit of a “charitable rollover,” may be capped or not offset the income.

As we know, in many ways, Congress basically just kicked the can down the road for a few months which left us with a lot of unanswered questions. In reviewing the expedited law, we see many areas that are in limbo at this time. It does not appear that Congress addressed any of the “sequestration” spending issues and the debt limit hasn’t been raised. It remains to be seen what cuts the President, the Democratic Senate, and the Republican Congress are ready to agree to, if any. If they aren’t willing to make big cuts, they will be back looking to raise more taxes once again in a few months. In the meantime, here are proactive steps you can take now:

Recommendations on What You Can Do Now

Prospective Clients

For prospective clients, the planning is the same as it has been in the last few years – much less about taxes and more about providing provisions for remarriage, divorce, creditor and asset protection, and Medicaid pre-planning. We are updating the current Legacy Wealth Planning Seminar now and next on deck will be the Basic Estate Planning Seminar, which should be posted by the end of the month. If you have seminars scheduled, please keep in touch with your PBC so she can keep you updated on the status of the seminar materials.

Clients

It is always recommended to have all clients come in every several years for trust review meetings to see if their needs have changed and if updates need to be made to their plans. This year is no different, with an additional opportunity to select certain client situations for a special review.

• For clients who set up AB Trusts to take advantage of the tax savings (and not for remarriage, divorce, creditor protection, etc.) there could be the possibility that some may no longer need that planning tool and could benefit by simplifying their plans and save on the administration fees on the first death. We are considering a possible Amendment Package for those who would fall under this category. We are still thinking through the ethical considerations of this before we roll it out. We’ll keep you posted on these developments.

• For clients who have simple Living Trusts, we recommend you still have them come in for trust review meetings even if they don’t need a major change. There are always major benefits to seeing your clients – solidify relationships, referrals, private seminars, Medicaid pre-planning, GST planning, or other services.

Centers of Influence

For professionals, reach out and communicate with them on the many non-tax reasons their clients should be planning. Schedule networking meetings and CE programs to educate the professionals in your area.

Materials Available for Members

Law Firm Website Postings – We posted two tax law updates to Academy hosted law firm sites, one on December 20th about the then pending changes and the second on January 7th about the current changes. You will find these postings under your Law Firm News section of your site. You can also link to these postings in your mass emails and social media postings.

Snipe or Starburst Copy – “How 2013 Tax Law Changes Impact You!” or “2013 Tax Law Changes Revealed!” – add to any seminar advertising, direct mail or marketing letters

Expect These Updates on Materials

For Prospective Clients (Most of these items will be released in January)

• Legacy Wealth Planning “Estate Planning Myths” Seminar and Handout

• Seminar Handout Insert (to update old stock)

• “Basic Estate Planning” Seminar and Handout

• Academy Blog Posting that can be linked on your own Social Media Accounts and Blogs

• Direct Mail Invitation from Response Mail – updated bullets on estate tax and long-term care planning

• Newspaper Ad – updated bullets on estate tax and long-term care planning

For Clients (Most of these items will be released in February)

• “Trust Tune-Up” Seminar for Clients and Invitation Letter

• Client Review Meeting Letter

• 2013 “Income and Estate Tax” Newsletter Insert

For Professionals (Expect the eAlert next week and the CE Course in February)

• Educational Alert – Much of what we outlined above will be available in the form of an Educational Alert for you to download and use in your emails, social media and letters to professional advisors, clients and prospects to give them an update on what the facts are about the law changes.

• 12-Part CE Program

Other Items

• 2 Estate Planning Articles

• Academy Reports – 35 reports

• And more!

We will continue to add items to the Academy website as they become available.

Susan Russel
Director of Member Services
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

We all know that the fiscal cliff legislation, officially known as the American Taxpayer Relief Act of 2012 (“ATRA”) made the estate, gift, and generation-skipping tax exclusion “permanent” (whatever that means in Washington) at $5 million (inflation adjusted). But, the legislation also included increases in income tax rates for high-earners. In fact, for couples earning more than $450,000, the top ordinary income tax rate went up to 39.6% and the rate for long-term capital gains and qualified dividends went to 20%.

In addition to the fiscal cliff changes, the 3.8% surcharge from “Obamacare” brings the new capital gains tax for high-earners in 2013 to 23.8% from only 15% in 2012. This is nearly a 59% increase in the tax rate, literally overnight. How can you help your clients in examining the existing laws to minimize the hit of these new taxes?

One way is to educate them on the availability of a Charitable Remainder Trust (“CRT”). A CRT is a tried and true strategy. This is not some newfangled, risky strategy. It is officially recognized in the tax code as a way to encourage giving to charity. With a CRT, an asset can be contributed and a charitable deduction is obtained, within limits.

Also, the income tax on any built-in gains is deferred. Of course, the gains are deferred until you sell the asset or otherwise trigger realization anyway. With a CRT, the gains are deferred even after the realization would have been triggered. This can be particularly attractive to clients now, when capital gains rates have just increased.

A CRT is a tax exempt entity and pays no tax itself. However, when distributions are made, they are taxed to the non-charitable beneficiary, who is ordinarily the client during the term of the trust. The distributions are “flavored” or “characterized” based on the history of what would have been taxed to the trust, had it been an ordinary taxpayer. So, if the trust sold a stock and recognized a capital gain, the distribution would be taxed to the non-charitable beneficiary as capital gain income. I’ll look at a more detailed example in my next blog posting.

However, this is a way to defer the recognition of income for many years. If the client / taxpayer is going to be retiring or otherwise will reduce their income in the future, the capital gain income might be taxed at a lower rate in future years. This might also be advantageous if the client were moving from a state with a high state income tax (like New York or California) to a state with no state income tax (like Florida or Nevada).

Clients may be particularly interested in hearing more about this strategy this year, when the sting of the newly increased tax rate is still smarting.

Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

Can the medium used to present medical information affect patients’ understanding and the decisions they make about their medical care?

Yes, according to a new study in the Journal of Clinical Oncology.

Researchers looked at different methods for presenting information about CPR (cardiopulmonary resuscitation) to advanced cancer patients. One group of patients listened to a verbal description of CPR and its chances of successfully resuscitating patients. The other group heard the same information, accompanied by a short (3-minute) video showing a simulation of a patient receiving CPR and being put on a ventilator.

The results: very different. Less than half as many people wanted CPR for themselves when they also saw the video (20%), compared to those hearing only the narrative (48%). Put another way, more than twice as many people wanted CPR when they hadn’t visually seen how it worked. The patients who saw the video were also better informed about CPR and their decisions. This study was conducted as a randomized controlled trial, the “gold standard” for medical research.

Inquiry about how patients — and people in general — process information and acquire knowledge is a burgeoning field of study, both in medicine and neuroscience. The latter has already demonstrated that individuals tend to process and understand information better when they receive it from more than one medium.

This raises a couple of questions for estate planning and elder law attorneys:

• As part of teaching your clients to be good medical advocates (for themselves or as a health care power of attorney), how might you counsel them about ways to better understand the information presented to them? You could advise them to ask for information in different modalities: they can ask for it in writing as well as just being “told.”  Or ask for a verbal explanation if they are only handed a piece of paper. This is important for follow-up instructions at a doctor’s visit or upon hospital discharge, as well as when making treatment decisions.

• Should we bring this approach (ie presenting information in multiple modalities) into the advance care planning process earlier on? Possibly even at the point of clients executing their advance directives?

And then there’s the broader question for your practice: As an attorney in an agency relationship with your clients, you possess a vast amount of complex, specialized knowledge that is guiding your counsel to them. Do you think it would help your clients, or your attorney-client relationship, if clients understood more about what you are advising them? (This is not a rhetorical question.)  Could it possibly even change their understanding of your questions and cause them to make different decisions? While clients presumably trust your professional expertise, would it nonetheless make some more comfortable to better understand what you’re creating for them? Would increased knowledge of or comfort level with your plan contribute to their willingness to pay a higher fee? To refer others to you?

If the answer to any of these is “yes,” what different, reasonably-priced media could you use to share information that you aren’t using now? If you are principally talking to clients presently, would it be helpful to have a written description also? What about pictures or diagrams — of the A/B Trust design of an RLT, for instance? (I know that those of you in the Academy have the latter already.)

Do you think anything works better than just talking with clients to help convey information and understanding? If so, what? I’d love to hear your thoughts. (And you don’t have to divulge your proprietary info.)

Randi J. Siegel,MBA, is the President of DocuBank(docubank.com), the largest advance directives registry in the U.S., which ensures that the emergency information and healthcare directives of its 200,000 enrollees are immediately available 24/7/365. Working with estate planning professionals since 1997, Randi frequently speaks at national estate planning conferences and has appeared on radio and television as an authority on registries. A member of the International Society of Advance Care Planning, she is active in health policy and health education related to advance care planning and advance directives and serves as Pennsylvania liaison to the National Healthcare Decisions Day initiative. Randi is an ongoing contributor to the Academy blog.

Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

It’s the start of a New Year, and if your law practice is not where you expect it to be, financially or structurally, then you don’t want to miss our upcoming free attorney Webinar hosted by Academy co-founders, Robert Armstrong and Sanford M. Fisch.

This Webinar will help you discover:

• What’s really happening in your practice and how it’s contributing to your current state of affairs (We’ll walk you through our simple attorney audit to help you discover where you are now, where you WANT to go and why you aren’t there yet, in a matter of minutes).

• The number one thing that comes between EVERY attorney and the next level of success they have their eye on. No matter how drastic the problem, we’ll show you how the solution is stunningly simple.

• The easiest way to maximize your income while working minimal hours.

• Highlights of the 11 Essential Systems to Dominate Your Market this year

• How you can go deeper in your training at the 2013 American Academy Boot Camp in Philadelphia…and attend with absolutely NO-RISK and no obligation (details will be shared on the Webinar).

It’s easy to get used to working in your business rather than working on your business. This Webinar will help you take a step back to assess where you really are right now in order to change the trajectory of where you are going in 2013.

“Law Practice Blueprint: 11 Core Systems for Total Estate Planning Success”

This Webinar will be on Wednesday, February 13^th at 5pm ET / 2pm PT. In addition to an eye-opening hour with Robert Armstrong and Sanford M. Fisch, Webinar attendees will receive:

• A free copy of The E-Myth Attorney, written by New York Times Best Selling Author, Michael Gerber and co-authored by American Academy of Estate Planning Attorneys co-founders Robert Armstrong and Sanford M. Fisch. This is a must-have resource for the attorney seeking to transform his or her practice into a profitable and sustainable business, rather than a J-O-B.

• Our exclusive Attorney Audit. We will use this resource interactively on the Webinar to help you start mapping out your course to success.

• A video recording of the Webinar so you can replay and watch again at your convenience (Can’t make the call live? Register anyway and we’ll still send you the recording).

Click here to register now – you’re just one step away from creating a blueprint for the law practice you always envisioned.

Kathryn Adams
Public Relations Manager
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com

The U.S. Supreme Court has scheduled the dates for oral arguments in two landmark cases concerning same-sex marriage. As I discussed in my December 26^th blog, these cases might have lasting impact on estate planning for same-sex couples.

The constitutionality of California’s Proposition 8 will be examined in Hollingsworth v. Perry. The Court will hear oral argument in the case on March 26^th.

The constitutionality of the Defense of Marriage Act (“DOMA”) will be examined by the Court in U.S. v. Windsor. Windsor involves a fact pattern which would be familiar to estate planners because it involves the availability of the estate tax marital deduction. The couple in Windsor had been married under the laws of Canada and lived in New York. At the time of the death, New York law recognized same-sex marriages performed in other jurisdictions. The decedent had left the assets to her surviving spouse in a manner that would have qualified for the marital deduction. Therefore, but for DOMA, the estate would have been entitled to a marital deduction. However, the marital deduction was denied in that case. The Court has scheduled oral argument in the case for March 27^th. (I was recently quoted in Estate Tax and Same-Sex Marriage, BNA Daily Tax Reports January 4, 2013, p. J-1, concerning the implications of Windsor.)

Today, estate planning for same-sex married partners is much the same as for unmarried partners, with a twist and a few extra layers. Depending on the holding in these cases, the planning might change considerably, both from a tax and a non-tax perspective.

Broadly, there are three possible avenues the Court could take in deciding these cases

1. The Court could hold that California’s Proposition 8 and DOMA are both unconstitutional because of a fundamental right to marry whom you choose. If the Court is going to go this route, one might wonder why it is taking both these cases, when Windsor alone would have been sufficient to do so.
2. The Court could hold that California’s Proposition 8 is unconstitutional because it removed a right which the California Supreme Court had granted and that DOMA is unconstitutional because the federal government cannot discriminate among married couples. However, the Court could determine that other states need not allow same-sex marriages nor respect those performed elsewhere.
3. The Court could uphold both Proposition 8 and DOMA.

Of course, the Court could surprise everyone with something completely different, too! We will have to wait and see. The Court is expected to hand down its opinions in these cases this summer.

Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com