The ABLE Act referred to in last month’s blog was signed by the Governor and becomes law effective July 1, 2016. The Act authorizes the State of Iowa to create savings accounts, similar to the 529 College Saving Plans, to be created for disabled persons prior to age 26. The income earned on such accounts are exempt from Federal income tax if the money is spent for eligible services. The Treasurer of the State of Iowa is drafting the administrative provisions for the Act and will act as the depository for the savings accounts.
Also, the Governor signed the Inheritance Tax bill. The Iowa inheritance tax exemptions have been broadened under the bill. The statue was amended to include gifts inherited by a lineal descendant of a decedent’s step-children to be exempt from Iowa inheritance tax. The new law will become effective July 1, 2016.
Regarding an administrative matter concerning a decedent’s estate: In the event a decedent occupied a residence or condo prior to his or her death and the residence or condo is unoccupied subsequent to his/her death, it is imperative that the executor/administrator of the decedent’s estate and/or the attorney for the estate, contact the homeowner’s casualty insurance company and report the insured’s property is unoccupied. Frequently, the insurance company will maintain the insurance at its current premium. On occasion, the insurance company may increase the premium a modest amount because the property is unoccupied. It is imperative that the insurance company be informed (put on Notice) that the residence or condominium is unoccupied.
– By Ned P. Miller