Pasternak & Fidis provides sophisticated, comprehensive estate planning for individuals, couples, families, and family businesses. Our senior estate planning attorneys bring decades of experience to our clients. Our younger attorneys all have excellent skills that will enable them to effectively represent clients and their descendants for many years to come. Together, our seven estate planning attorneys offer a coordinated approach that goes well beyond wills and trusts.
Effective tax planning is a critical part of estate planning. We structure estate plans to take advantage of all available tax-saving strategies. Real estate interests, closely held businesses, and other enterprises require special attention. We combine tax expertise, business knowledge, and common sense to help protect and preserve our clients’ wealth for future generations.
Planning for incapacity is an important part of the planning process. We work to ensure our clients’ needs are met and their wishes honored, both with respect to their financial affairs and their health care decisions.
We are experienced in working with complex family structures, including step-families and domestic partners.
Pasternak & Fidis has cultivated strong relationships with other professionals. We work regularly with our clients’ accountants, insurance agents, appraisers, financial planners and investment advisors.
If you are interested in our estate planning services we invite you to call for an appointment. We ask our new estate planning clients to complete an estate planning information form in advance of our initial meeting. Our two forms are listed below. The long form is recommended for clients with complex assets, such as investment real estate, closely held business interests, multiple life insurance policies, and the like. The short form can be used by clients whose asset categories are more straightforward, such as bank and brokerage accounts, retirement accounts, and personal residences. Please print the form that is applicable to you, complete it, and bring it with you to our initial meeting. In the alternative, you can save the form to your desktop and complete it electronically before returning it to our office.
With boomers living longer and marrying multiple times, the argument for premarital agreements for these couples is compelling. A premarital agreement defines the property rights of the parties when the marriage ends at death or divorce. Not all marriages between mature people will last until death.
Property Rights at Dissolution. A premarital agreement will typically provide for each party to retain exclusive rights to existing assets and assets acquired during the marriage by gift or inheritance. Parties must decide whether they want a title-controls type of agreement, so that each retains exclusive rights to all property he or she owns, or whether they want to share the fruits of their labor. When both parties have substantial assets and both are still working, with the ability… MORE >
Having served for 10 years on the Council for the Estate and Trust Law Section of the Maryland State Bar Association, I became Chair at the end of June. It is both an honor and a privilege to serve, and it is not lost on me that my term takes place during a worldwide health crisis that has disrupted how we work, and at a time of public and private reckoning with what a history of unjust choices has wrought in our communities.
As to the latter, my goal is to focus this year on concerted efforts to improve diversity, equity, and inclusion in the Section and on the Council. Our first step, unanimously adopted at our June meeting, was to expand by 10 the… MORE >
One question that clients frequently ask is “How often should we review our estate planning?” Although a comprehensive estate plan should not require frequent, extensive review, we recommend regular, periodic reviews of your core estate planning documents (will, revocable trust, financial power of attorney, advance health care directive) to ensure the documents accomplish your current objectives, especially if your circumstances or wishes have changed.
You should also consider the potential impact of changes in tax laws on your estate plan. Under a 2017 law, the federal estate, gift and generation-skipping transfer (GST) tax exemption amounts were temporarily doubled (see “Tax Cuts and Jobs Act: Impact on Estate and Gift Planning,” Pasternak & Fidis Reporter (Spring 2018)). For 2020, the exemption amount is $11.58 million and… MORE >
In response to budgetary pressures, D.C. Mayor Muriel Bowser signed the “Estate Tax Adjustment Amendment Act of 2020.” The Act reduces the estate tax exemption from $5.76million in 2020 to $4 million for decedents dying on or after January 1, 2021. The exemption amount will be adjusted for inflation starting in 2022 and will continue to be non-portable between spouses. The Act becomes law on November 2, 2020, 60 days from the date it was submitted to Congress for passive review. The change to the D.C. estate tax exemption amount is a reminder of the importance of crafting an estate plan with sufficient flexibility to accommodate unanticipated changes to the estate tax laws. D.C. residents whose estates exceed the $4.0 million estate tax exemption amount may wish to… MORE >
The Setting Every Community Up for Retirement Enhancement Act (the “SECURE Act”) took effect January 1, 2020, revising federal rules that govern the administration of qualified retirement plans (e.g., 401(k) and 403(b) plans) and IRAs. Among the changes effected by the new law is the shrinking of the class of beneficiaries who can “stretch” out their required minimum distributions (“RMDs”) from such accounts over their expected lifetime. This stretch of RMDs was a tax benefit, because it allowed the beneficiary to defer income tax, keeping assets in the tax-favored vehicle as long as possible, where they could grow without diminishment; it is only upon distribution that the assets would be subject to income tax.
The SECURE Act imposes a maximum 10-year payout rule for retirement accounts… MORE >
We don’t often get the question, “Can I disinherit my spouse?” but the subject has been fraught with consternation for Maryland estate planners for many (many, many) years; we used to have to answer it with “it depends.” We will soon have greater certainty—for decedents dying on or after October 1, 2020, it’s going to be harder to disinherit a surviving spouse entirely in Maryland. It will be easier, however, to design an estate plan that pre-funds the spouse’s share, balancing competing interests without disrupting the family business or forcing the sale of illiquid assets.
A Little History
To understand the impending (and extremely complicated) new rules, it helps to explain how the old rules worked and why they stopped working. Under old law (still… MORE >
Many parents like to vacation with their children, to the beach, to a national park, to visit a big city. Some families travel abroad. Parents who are separated, or planning to separate, should include rules about traveling with minor children in their settlement negotiations. Parents can avoid disputes by agreeing to travel protocols in their parenting plan.
What is required to apply for a U.S. passport for a child under age 16?
A child under the age of 16 must apply for a passport in person. The child must be accompanied by both parents, as required by the federal Two- Parent Consent Law, and provide proof of the child’s citizenship (U.S. birth certificate; a valid, undamaged U.S. passport (may be expired); a foreign birth certificate).
… MORE >
* With thanks to playwrights Abe Burrows, Jack Weinstock, and Willie Gilbert, and composer and lyricist Frank Loesser, without whom the world would lack the wonderful play, “How to Succeed in Business Without Really Trying” (1961)
This is a story of three different people with a similar issue, but very different concerns. Each of them is a successful business owner, and each is struggling with how to leave the legacy of their life’s work without destroying the business or their family. Consider:
Trusts are an important tool that families can use to protect assets and pass wealth to future generations. When the beneficiary of a trust is facing divorce, he or she will be concerned that the trust assets and income may be vulnerable to a spousal claim. Such a claim can include equitable division of property, spousal or child support, and an award of legal fees and costs.
Whether and to what extent a beneficiary’s interest in a trust can be subject to a spousal claim at divorce depends on:
Many couples establish savings for the college education of their children. A Section 529 account is an attractive vehicle for these savings, as discussed in Adam Swaim’s article. What happens to a 529 account if the parents divorce? The appeals courts of D.C., Maryland, and Virginia do not yet appear to have wrestled with a parental dispute about a 529 account in a divorce. Only a few cases from courts around the country have done so. They offer some guidance to parties and their lawyers as to how our courts may handle a dispute over a 529 account that arises between divorcing parents. More importantly, they point out issues that parties should address when negotiating a marital settlement agreement where they have a Section 529 account for a child.
Some key legal aspects of Section 529 accounts: