On December 20, 2019, the President signed into law the Secure Act. This article will focus on the key provisions of the new Act. The new Act changes the beginning age for taking required minimum distributions to age 72. The new law applies to account owners who turn 70½ after the year 2019. The new Act also repeals the prohibition on contributions to a traditional IRA by an individual who has attained the age of 70½. Owners of traditional IRA’s can now make contributions past the age of 70½. The new Act also allows taxpayers to withdraw up to $5,000
More Legal News & Information... →The Iowa Legislature recently passed and the Governor signed legislation which makes significant changes to the Iowa law regarding guardianships and conservatorships for adults and minors. This month I will deal with the changes regarding Guardianships for adults and Conservatorships for adults and minors. Next month, I will discuss changes for Guardianships for minors. For new guardianships and conservatorships which are opened after December 31, 2019, there are new requirements requiring professional evaluation of the proposed protected person and a requirement for a background check for all proposed guardians and conservators. The guardian and conservator is required to file an
More Legal News & Information... →The Federal Path Act includes provisions to allow a taxpayer who is age 70½ or older to make tax-free distributions from their IRA’s to qualified charities. The Path Act allows an individual who is over the age of 70½ to make a direct distribution from their IRA account to a charity. The benefit of doing such is that the amount transferred to the charity will be counted as part of the taxpayer’s qualified minimum distribution and it will also not be included in the taxpayer’s gross income for Federal and State income taxes. In order to qualify as a qualified
More Legal News & Information... →Last month the IRS issued the final regulations regarding Section 199A. The IRS also issued IRS Notice 2019-07 which set forth a safe harbor under which a rental real estate enterprise would be treated as a trade or business under Section 199A. The purpose of the Notice is to give taxpayers guidelines as to the application of the 199A deduction for rental real estate properties. To qualify for the safe harbor requirements, the taxpayer must meet the following requirements: Keep separate books and records setting out the income and expenses for the rental real estate enterprise; For tax years beginning
More Legal News & Information... →Last month the Internal Revenue Service issued a proposed regulation addressing large gifts made prior to 2026. The basic exclusion amount for estate or gift tax for the year 2017 was $5,490,000.00. The 2017 Tax Cuts and Jobs Act increased the basic exclusion amount from 5 million to 10 million for tax years 2018 through 2025 with both dollar amounts adjusted for inflation. For the year 2018 the basic exclusion amount adjusted for inflation is $11,180,000.00 million. For 2019 the basic exclusion amount adjusted for inflation is $11,400,000.00. Under the 2017 Tax Cuts and Jobs Act in the year 2026,
More Legal News & Information... →A recent case by the Iowa Court of Appeals dealt with the tort of intentional interference with an inheritance. In the case, the testator died in 2015. She had three children, two sons and a daughter. She executed a Will in 2010 which divided her estate equally among her three children. She executed another Will in 2011 which left most of her estate to her son, Wayne. After the 2011 Will was drafted, the other two children moved to file for a Guardianship and Conservatorship in regards to their mother. The other brother, Wayne, proceeded to have a Codicil drafted
More Legal News & Information... →The Iowa Supreme Court issued an opinion on March 2, 2018, in the case of Erpelding v. Erpelding which found that a prenuptial agreement which waives an award of attorney fees regarding issues of child or spousal support adversely affects the right to support and are categorically prohibited by Section 596.5(2) of the Iowa Code. Iowa Code Section 596.5(2) provides that the right of a spouse or child to support shall not be adversely affected by a premarital agreement. If you have questions or need more information concerning prenuptial agreements, please contact us through the contact page on our Web
More Legal News & Information... →This brief article will deal with the changes to the Estate, Gift and Generation Skipping Tax under the new tax law. The Act doubles the basic exclusion amount for estates of individuals who die during the 2018 through 2025 tax years and for gifts made during those same tax years. The basic exclusion amount for each person increases from 5.6 million per person in 2017 to 11.2 million per person in 2018. The amount of the exclusion will be indexed for inflation starting in tax year 2019. The Act does not repeal the estate, gift or generation skipping tax for
More Legal News & Information... →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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