The use of transfer on death and payable on death registrations for bank and investment accounts has increased dramatically. Banks and investment firms are pushing their clients to sign the forms claiming that the forms will eliminate the need for probate administration. Chapter 633D of the Iowa Code deals with transfer on death registrations which applies to investment accounts. The Act allows the owner to designate the beneficiary of the account in the event of the owner’s death. The beneficiary form may be cancelled or changed at any time by the owner without the consent of the beneficiary. The Act
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The Iowa Supreme Court, on November 17, 2017, issued an opinion interpreting a definition utilized in an inheritance tax exemption. The Court points out that for many years prior to 1997 the Iowa inheritance tax had an unlimited exemption for any share of the estate passing to the surviving spouse, limited exemptions for lineal descendants and lineal ascendants and no exemption for step-children. In 1997, the Legislature eliminated inheritance tax on property passing to parents, grandparents, great grandparents, children, stepchildren, grandchildren and great grandchildren among others. In 2003, the Legislature added a definition for “stepchild” which defined “stepchild” as the
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Many individuals regularly make gifts to qualified organizations to receive tax-deductible contributions. Pursuant to the IRS rules, a taxpayer who makes a single donation of $250.00 or more to a qualified charity must have an written acknowledgement from the Organization for each single donation of $250.00 or more or an written acknowledgement from the Organization setting out the date and amount of each contribution in excess of $250.00. The $250.00 amount set out above does not mean that you add up all contributions to see if you reach the $250.00 limit. The $250.00 threshold is only reached when you make
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The Iowa Department of Revenue has had a long standing position that it will not accept Family Settlement Agreements to change the calculation of Iowa Inheritance Tax. The Department has always relied on the original Will or Trust to calculate the amount of inheritance tax owed to the State of Iowa. A recent Iowa Court of Appeals decision has changed the long standing policy regarding Family Settlement Agreements. Family Settlement Agreements arise in estates or trusts where the beneficiaries of the Estate or Trust agree to enter into an agreement to change how the assets of the Estate or Trust
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Many clients inquire as to the process to donate one’s body to the University of Iowa for scientific purposes. In order to be effective, the University of Iowa requires that a Deed of Disposition of Body for Scientific Purposes be on file with the University prior to an individual’s death. The Deed of Disposition of Body for Scientific Purposes can be executed by a person who is 18 years of age and competent. The University retains the right to not accept the body if it is not appropriate for their needs. The family of the donor or the estate of
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I have written previously in this Blog regarding the use of Medical Power of Attorneys and Financial Power of Attorneys. One of the benefits of the Health and Financial Powers is that in many cases they can be used to avoid setting up a formal Guardianship and Conservatorship with the Court. The Guardian makes medical and social decisions for the Ward and also decides on where the Ward will reside. The Conservator handles the Ward’s property and finances. Either an individual or a bank may act as a Guardian or Conservator. Guardians and Conservators are required to file annual reports
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I frequently see clients come into my office who have met with their banker and set up joint tenancy with rights of survivorship bank accounts naming another person who is not their spouse as the joint tenant on the account. Often times a client simply wants to name another person to write checks on the account. Note that there is a difference between adding another person with signature authority versus adding another person as a joint tenant. A person with only signature authority does not have ownership of the account and only has the power to write checks on the
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A new law was recently signed by the Governor which authorizes tax-preferred First-Time Homebuyer Savings Accounts beginning in the year 2018. Under the law, when an individual sets up a FTHSA account, he or she may exclude from their Iowa adjusted gross income yearly deposits of $2,000. Married taxpayers who file a joint return may exclude up to $4,000.00 a year if the money is deposited into a joint FTHSA. Any interest earned on a FTHSA account, will not be included in a taxpayer’s income. At the time that the FTHSA is opened, an individual can designate a sole beneficiary.
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On April 20, 2017, Governor Branstad signed the Iowa Uniform Fiduciary Access to Digital Assets Act which is codified in Chapter 638 of the Iowa Code. The Act broadly defines “digital asset” to mean any electronic record in which an individual has a right or interest. However, the term “digital asset” does not include an underlying asset or liability unless the asset or liability is itself an electronic record and the term “digital asset” does not include health information or individually identifiable health information as those terms are defined in the Federal Health Insurance Portability and Accountability Act of 1996.
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The lawsuit filed by the Des Moines Waterworks against the drainage districts in three Northwest Iowa Counties has been followed extensively in the press. The case which deals with the issue of how to deal with the levels of nitrates in the State’s drinking water was filed in the United States District Court for the Northern District of Iowa. The Federal District Court Judge certified four questions to the Iowa Supreme Court in order to clarify issues of Iowa law raised in the lawsuit. The Iowa Supreme Court issued a ruling finding that Iowa law has immunized drainage districts from
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