mm wrote:
- quote -

Ok, that changes everything. If there is a written trust, you have
to look at its terms. But chances are it's considered a completed
gift, and belongs to the beneficiary (the in trust "for" person) at
the moment the money is put into the trust, and the trustee can't use
it except for the beneficiary.

- quote -

If you die first the chances are the trust calls for appointment of
another trustee. It may already name someone, or they might have to
go to court to have someone appointed.

- quote -

Chances are it can be protected from the wife, even in a community
property state. But you'd really need to take the trust document to
a local lawyer who can analyze it properly.

- quote -

No, it's not a violation of ethics. But especially during times of
grief lawyers have to be very careful not to do anything that would
look like improper solicitation.

- quote -

It depends on the rules of the state. It is unlikely to have
anything to do with whether it's a community property state or not.

- quote -

I don't understand what you mean.

- quote -

Probably not, but the trust document needs to be reviewed to be sure.

But for income tax purposes, if the trust has taxable income and that
income is distributed to the beneficiary, the trust gets an income
tax deduction, and the beneficiary recognizes that income on his
income tax return.

Stu

On Oct 16, 5:45 am, mm <NOPSAMmm2...[at]bigfoot.com> wrote:
- quote -

MM, did you forget you're not the OP in this thread? IMO Stu, and
Deadrat, were both responding in relation to OP, who asked about
setting up a bank account with "in trust for" in the account name,
which would in fact be an informal Totten trust. Stu was not
responding to your situation, except to point out to you that your
comment (about the need to label or document the trust other than
through the bank documents) was going down a tangent that had nothing
to do with OP's question. He was _not_ IMO telling you that your
"mommy trust" was an informal trust, as you seem to have taken him to
mean.

And I point this out here only to try to avoid more of the inevitable
confusion, of the "who's on first?" variety, that ensued in the rest
of your post (which I snipped) and will continue to ensue in this
thread as long as you, and others, mix up the discussion of OP's
informal bank account trust with discussion of your heavily
documented, formal trust for benefit of your brother.

Mandatory legal content: Mr. Moderator, this post is about how easily
different parties can have widely differing linguistic interpretations
of the same contract, statute, sentence or paragraph, and the value of
both clear expression by the drafter and careful, analytical review by
the recipient of exactly what was said, in making sure that all
parties are on the same page as to what was meant. While pregnant
ambiguities and plausibly-deniable misunderstandings can be useful in
international diplomacy and in flirting, IMO the only thing they do
when found in any other kind of possibly legally binding context is
create the basis for full employment for lawyers, who have to wrangle
over what was really meant. But for the needs of the clients, clarity
is a virtue.

Cheers,

--
This posting is for discussion purposes, not professional advice.
Anything you post on this Newsgroup is public information.
I am not your lawyer, and you are not my client in any specific legal
matter.
For confidential professional advice, consult your own lawyer in a
private communication.

Mike Jacobs
LAW OFFICE OF W. MICHAEL JACOBS
10440 Little Patuxent Pkwy #300
Columbia, MD 21044
(tel) 410-740-5685 (fax) 410-740-4300

On Oct 16, 5:45 am, mm <NOPSAMmm2...[at]bigfoot.com> wrote:
- quote -

MM, did you forget you're not the OP in this thread? IMO Stu, and
Deadrat, were both responding in relation to OP, who asked about
setting up a bank account with "in trust for" in the account name,
which would in fact be an informal Totten trust. Stu was not
responding to your situation, except to point out to you that your
comment (about the need to label or document the trust other than
through the bank documents) was going down a tangent that had nothing
to do with OP's question. He was _not_ IMO telling you that your
"mommy trust" was an informal trust, as you seem to have taken him to
mean.

And I point this out here only to try to avoid more of the inevitable
confusion, of the "who's on first?" variety, that ensued in the rest
of your post (which I snipped) and will continue to ensue in this
thread as long as you, and others, mix up the discussion of OP's
informal bank account trust with discussion of your heavily
documented, formal trust for benefit of your brother.

Mandatory legal content: Mr. Moderator, this post is about how easily
different parties can have widely differing linguistic interpretations
of the same contract, statute, sentence or paragraph, and the value of
both clear expression by the drafter and careful, analytical review by
the recipient of exactly what was said, in making sure that all
parties are on the same page as to what was meant. While pregnant
ambiguities and plausibly-deniable misunderstandings can be useful in
international diplomacy and in flirting, IMO the only thing they do
when found in any other kind of possibly legally binding context is
create the basis for full employment for lawyers, who have to wrangle
over what was really meant. But for the needs of the clients, clarity
is a virtue.

Cheers,

--
This posting is for discussion purposes, not professional advice.
Anything you post on this Newsgroup is public information.
I am not your lawyer, and you are not my client in any specific legal
matter.
For confidential professional advice, consult your own lawyer in a
private communication.

Mike Jacobs
LAW OFFICE OF W. MICHAEL JACOBS
10440 Little Patuxent Pkwy #300
Columbia, MD 21044
(tel) 410-740-5685 (fax) 410-740-4300

On Sun, 14 Oct 2007 12:41:15 -0400, Stuart Bronstein
<spamtrap[at]lexregia.com> wrote:

- quote -

No, no, the trust document is several pages long. (It's been 12 years
and I forget how long.)

- quote -

No, it doesn't. That was the whole point. I'm embarrassed to indicate
the original motive, even though I'm almost anonymous here, but my
brother is a doctor who lives in the state with the highest rate of
malpractice suits in the country. And he is in a specialty with a
high rate of malpractice suits. And a doctor he worked with was sued
for malpractice before my brother went to work with him**

**And rightfully so, since he (not my brother) killed a healthy child
by allowing the nurse (or someone with even less training) to decide
how much anesthesia to give the child based on her words "When I
worked for Doctor Smith, we used this much." which apparently could
not have been true, since none of Doctor Smith's patients died. The
child's mother was a lawyer, but I doubt that made much difference,
since anyone would have sued. Well maybe she sought out or saved the
evidence better. I presume the parents won, but I don't know how
much.

AFAIK, my brother has never hurt anyone, and has not ever made a
mistake even that could have hurt someone. (Well I guess that's not
too likely in 43 years, but he's the most conscientious guy I know.
And the most conservative, unegotistical doctor I know, based on
things he's said when I've been sick.)

- quote -

That's the rule regarding this trust now. I give him what he wants
because he's big enough to run his own life. In fact he's older than
I am. But the trust doesn't require it. He's not even named in the
trust iirc. Hmmmm. I wonder what happens if I die before giving him
everything. Well maybe he is named. (I get the trust and my mother's
will mixed up.) I'll go check tomorrow.

Well, I think after he retires, which is soon, he'll know if he
injured anyone, but I guess he'll wait a while until the statute of
limitations runs on those he didn't actually injure, and then he'll
take all the money.

But now I'm wondering about his wife, who IS a spendthrift, and
whether he should protect the money from her, in case she decides to
divorce him. Since it's like an inheritance -- maybe it's not really
an inheritance because the trust interfered -- does it matter if they
live in a community property state or not? She's still not entitled,
is she, even to half?

I should see a lawyer. The lawyer who wrote the will (and the trust
maybe) I thought was difficult to deal on some things, and he didn't
even approach me after my mother died to handle her estate. Would
that have been a violation of ethics, considering he already worked
for her? I thought a lawyer, when I asked him to send the will to
the state office of wills, would say something like "Of course. I'll
send them today. Do you need any help with the trust?" Is that a
violation of legal ethics?

- quote -

Oh, ok. Forget the question above.

- quote -

What about earlier, from my mother to the trust?

My gosh, do I have to worry about gift tax when the trust gives him
money? No one said anything about that!


- quote -


If you are inclined to email me
for some reason, remove NOPSAM :-)

mm wrote:
- quote -

What was described is an informal trust. There is no documentation
except the bank records saying that it is X's account "in trust for
Y." The general view by courts is that this scheme does not really
set up a current trust, and in fact transfers no ownership rights at
all currently. When X dies the account can be transferred to Y
without the need of probate, but that's pretty much it.

- quote -

No, it belongs to him legally, so his creditors can get at it. If
that is your goal you might be able to set up a spend-thrift trust.
The beneficiary has no legal right to demand any of the funds from
the trust, and his creditors have no rights in trust funds, either,
until after they are given to the beneficiary. Some states don't
allow spendthrift trusts to avoid all creditors, though (e.g. alimony
or child support may be an exception).

- quote -

It might, depending on the facts.

- quote -

Generally but not necessarily. As you noted in a community property
state if the surviving spouse claims to have superior rights that
might have to be determined by a probate court.

Stu

On Tue, 09 Oct 2007 08:39:09 -0400, Deadrat <a[at]b.com> wrote:

- quote -

Perhaps it has to be labelled as a revocable trust. My mother's trust
for my brother, for which I am the successor** trustee, is called the
Jane Mommy Revocable Trust. It's still called that even though my
mother has died, and it's not revocable anymore.

I give him whatever money he requests, but I think by leaving as much
as possible in the trust it is safe from divorcing wives.
Although wouldn't it be anyhow, since he didn't *earn* the money, but
inherited it? Does it matter if it is a community property state or
not?

**My mother, Jane Mommy, was the original trustee.

- quote -

Doesn't the trust money pass outside of probate?

- quote -

If you are inclined to email me
for some reason, remove NOPSAM :-)

rdadams[at]panix.com (Dick Adams) wrote in
newsv3kg358hp37p3knk3uip62pupao4rni73[at]4ax.com:

- quote -

I think that while the trustee is alive, he's the effective owner, since
the trust formed is revocable. For instance, the IRS doesn't care about
ITF designations during the trustee's lifetime, and the trustor/trustee
will have interest reported under his SSN and will pay any taxes due on the
interest.

Once the trustee dies, there are certainly implications for probate, and
there can be tax implications.

Have I got this wrong?

- quote -

gotosteve[at]gmail.com

- quote -

I'm taken aback by the fact that they would ask you such a
question! It would be reasonable for them to ask you for
the name and SSN of someone "in case of death".

"In Trust For" makes you the trustee, not the owner, and it
has significant legal and tax implications.

I am srossposting to misc.taxes.moderated where the tax
implications may be explained.

Dick