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Every fall we send out a newsletter highlighting the recent changes in our practice and state and federal laws relating to our practice area.  Here are our newsletters from 2005 to the present.

Fall 2009

It’s hard to believe that it’s only been a year since our last annual letter. What a year it has been! The bad economic news last fall and winter was followed by seemingly endless rain in the spring and early summer, making us happy to see some economic recovery and the sun more recently. We hope that the positive trend will continue as we approach the end of this year.

As in prior years, we are pleased to send you this annual summary of the most significant changes to both state and federal laws which affect estate planning and estate or trust administration. We hope that you will find this information to be helpful.

After many changes to New Hampshire trust and probate laws during the past few years, only one significant change was adopted this year. On January 1, 2010, same sex marriage will be recognized in New Hampshire, completely replacing civil unions in 2011. An 8% New Hampshire estate tax was proposed with a $2,000,000 exemption, but it failed to be adopted.

The federal government has also left us wondering about changes in the federal estate tax exemption, which is now $3,500,000. As a result of laws adopted in 2001, this exemption is scheduled to be unlimited in 2010, with a return to a $1,000,000 exemption in 2011. We expect this law to be changed before the end of the year, retaining the exemption at $3,500,000 for 2010 and possibly for a number of years thereafter. We also expect the annual gift tax exclusion to remain at $13,000 in 2010.

The relative lull in new legislation has permitted us to focus our attention on other matters this year, including efforts to reduce our carbon footprint. Although we are still tied to paper file copies and document drafts, we now recycle our shredded white paper, cans and plastic containers. We are also using email more often for communication with clients.

We have updated our website to include new articles on estate planning and additional links on related topics. Please visit our site at www.ansellpa.com. If you would like to receive notice of new articles posted to our website from time to time, please join our mailing list on the ARTICLES AND BLOG page of our website. We will post an article outlining changes to the estate tax exemption as soon as this information is available.

If the estate tax exemption remains at $3,500,000, as we expect, many of our clients who created estate tax planning trusts may consider simpler estate plans which do not include tax planning. If you and your spouse created revocable trusts for estate tax planning which have not been reviewed in several years, we encourage you to schedule an appointment to discuss your options.

During the past few years, New Hampshire adopted and then modified the Uniform Trust Code. One of the provisions of this law which has caused concern for some of our clients is the requirement that notice be given to qualified beneficiaries of the Trust who may have the right to request a copy of the Trust and the annual account of the Trust. Although these rules do not apply to Revocable Trusts until they become irrevocable as a result of the death or incapacity of the person who created the Trust, some clients are reluctant to give the requisite notice to contingent beneficiaries. By example, after a person dies, notice may need to be given to his or her adult children, even though they may not receive a gift until the surviving spouse dies. This rule automatically applies to all New Hampshire Trusts which become irrevocable or have a new Trustee after October 1, 2004, unless the Trust has been expressly written to limit the notice requirement. As a general rule, our standard Trust provisions do not limit notice to beneficiaries as we believe that the benefits of notice typically outweigh the disadvantages. If you do not want notice to be given to some of the beneficiaries of your Trust after it becomes irrevocable, however, your Trust should be amended while it is still revocable.

Over the years, many clients have asked us to recommend an understandable guide to trusts. In response to these requests, Ruth has prepared a Client’s Guide to Trusts which you may download without cost as a pdf from a secure page on our website. In order to access this page, you will need to include the user name ansell and the password estateplan on the CLIENT LOGIN page. After you have signed in, the SECURE PAGE will appear in your tool bar. Although this page is only available to our clients, please feel free to share this Guide with your friends and family.

Copies of the Client’s Guide to Trusts are also available for you to pick up at our office during business hours. If you would like a copy of this Guide to be mailed to you, please send us a check for $10 to cover postage and handling.

Ruth and Christine were honored once again to be listed in the October issue of New Hampshire Magazine as top attorneys in trust and estate law. Christine was also named as one of the best elder law attorneys in New Hampshire.

Many years ago, we adopted a file destruction policy for closed files. Under this policy, we will destroy former client files which have been inactive for at least 10 years. By example, when clients move to another state and retain a new attorney, they will be treated as former clients. As long as you receive our annual letter, you are still considered to be our client and your file will not be destroyed. Further, we will not destroy original estate planning documents. In conformity with our obligation to keep your affairs confidential, destroyed files will be shredded. We also encourage each of you to review your files from time to time and to safely discard obsolete records.

As always, it is important that your estate pass to your intended beneficiaries, whether by will, trust, beneficiary designation or joint tenancy. We encourage each of you to review your estate plan every year, including a review of your current documents, ownership of assets and accounts, and confirmation of beneficiary designations, and to consider whether changes are needed. This recommendation is especially true in light of the significantly increased estate tax exemption and economic decline which have occurred in recent years.

We have enjoyed working with you in the past, and look forward to helping you, your family and friends with estate planning, trust, and probate issues in the future. We appreciate your loyalty and referrals.

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Fall 2008

With the passing of summer, we have been able to review the laws passed by the New Hampshire legislature during the past year. As in prior years, we are pleased to send you this annual summary of the most significant changes to both federal and state laws which affect estate planning and estate or trust administration. We hope that you will find this information to be helpful.

In 2009, New Hampshire will become the 10th state to recognize the validity of an asset protection trust. After 2008, individuals may create an irrevocable trust to protect trust assets from some of their future creditors, without giving up all of their rights to this property. The grantor of the trust can retain management responsibilities and a beneficial interest in the trust, within certain guidelines. A New Hampshire resident (other than the grantor of the trust), or a bank or trust company must be the trustee. No protection will be provided for fraudulent transfers, or for claims to child support, alimony or similar rights. Further, no protection will be provided for death, personal injury and property damage claims which were caused before property was transferred to the trust. Finally, the rights retained by the grantors of the trust may disqualify them from receipt of Medicaid assistance. Please call to schedule an appointment to discuss the creation of an asset protection trust, if you want to consider it as part of your estate plan.

Given today’s volatile banking environment, we are all looking more closely at the FDIC insurance limits. We recommend that clients confirm adequate coverage for their bank accounts. The FDIC recently adopted interim rules, designed to simplify the FDIC insurance coverage for accounts titled in a revocable trust or payable on death to designated beneficiaries. The new interim rules provide that the grantor of a revocable trust account may be insured for up to $1,250,000 (not to exceed $250,000 for each of 5 different post-death beneficiaries). In 2010, this amount will drop to $500,000 (not to exceed $100,000 for each of 5 different post-death beneficiaries). The amount of coverage depends on the terms of the trust and the number of beneficiaries. Similar rules will apply to accounts which are payable on death to designated beneficiaries. If you have established accounts in the name of your revocable trust or payable on death to designated beneficiaries, you do not need to change the title on these accounts to your individual name in order to be insured by the FDIC. Individual accounts are also insured up to $250,000 until 2010.

Over the years, we have had some unusual assets pass through our clients’ estates and trusts. As most of you know, we encourage our clients to plan the disposition of their estates as easily as possible. Toward this end, one of our clients has decided to facilitate the administration of his future estate by selling a large quantity of his unused postage stamps. At his suggestion, these stamps are being used for this bulk mailing. Some of you may notice the unusual combination of multiple stamps on your envelope. We encourage each of you to find equally creative and resourceful ways to facilitate the future disposition of your estates.

We were honored once again to be listed in the October issue of New Hampshire Magazine as top attorneys in trust and estate law. Christine was also named as one of the best elder law attorneys in New Hampshire. A few years younger than Ruth, Christine is celebrating her 20^th year practicing law. We both look forward to working with you for many more years to come. In the more immediate future, we wish you very happy holidays.

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October 2007

We have enjoyed such beautiful autumn weather this year, the snow birds will find it difficult to leave New Hampshire! Nevertheless, the changing leaves remind us that it is time to send our annual summary of the most significant changes to the federal and New Hampshire laws which affect estate planning and estate or trust administration. Although it has been a relatively quiet year, we hope that you will find this information to be helpful.

In 2008, the federal estate, gift and generation skipping transfer tax exemptions will be unchanged. The estate and generation skipping transfer tax exemptions will remain at $2,000,000, the gift tax exemption will remain at $1,000,000, and the annual gift tax exclusion will remain at $12,000. Estate tax will be applied at the flat rate of 45% for estates in excess of the exemption. Congress did not pass any legislation to reform the currently scheduled increase of the estate tax exemption to $3,500,000 in 2009 or the temporary repeal of estate taxes in 2010. We anticipate legislation to change estate taxes next year. We will keep you informed of any changes to the law in this area.

Beginning on January 1, 2008, New Hampshire will recognize civil unions between same gender couples. Under this new state law, couples who have entered into a civil union will have the same rights, responsibilities and obligations as married couples. These couples will not, however, be treated as married couples under current federal law. Some employment benefits may be available by contract. Careful planning will continue to be needed as this area of law develops.

Under current law, the Uniform Transfers to Minors Act (UTMA) and qualified minor’s trusts are alternative ways to make lifetime gifts to minors (defined as individuals under age 21) which qualify for the annual gift tax exclusion. Under New Hampshire law, UTMA property may be used for the benefit of the minor until age 21, but at that age, the minor is entitled to receive all of the custodial property. Under federal tax law, a qualified minor’s trust may similarly be used for the benefit of the minor until the age of 21, but the balance of the trust assets can continue to be held in trust after the age of 21 with the consent of the minor. In most qualified minor’s trusts, if the minor does not withdraw the trust assets within 30 days after attaining age 21, the trust will continue for the benefit of the minor until an age of greater maturity. After 2007, custodians of New Hampshire UTMA property will be able to transfer the custodial property to a qualified minor’s trust so that this property will continue to be held in trust with the consent of the minor after the age of 21. If you would like to discuss the transfer of assets from a custodial account to a qualified minor's trust, please call to schedule an appointment with Ruth or Christine.

Good news! After several years of dispute on this issue, the State of New Hampshire will treat distributions from special needs trusts in a manner that is consistent with federal law. Distributions made after November 1, 2007 will no longer need to be limited to the trust administration expenses and uninsured medical or education expenses of the beneficiary in order to be disregarded for medical assistance income eligibility purposes.

If you own real estate outside of New Hampshire, we recommend that you have your estate planning documents reviewed by an attorney in the state where the real estate is located in order to minimize or avoid state death tax and probate costs. New Hampshire continues to have no state estate tax. However, many other states have recently adopted new state death tax laws which would apply if you own real estate or tangible personal property in that state at the time of your death. Similarly, if you move to another state, your estate plan should be reviewed by an attorney in your new home state and, generally, we should no longer hold your original estate planning documents.

As always, it is important that your estate pass to your intended beneficiaries, whether by will, trust, beneficiary designation or joint tenancy. We encourage each of you to review your estate plan every year, including a review of your current documents, ownership of assets and accounts, and confirmation of beneficiary designations. We recommend that you consider whether changes are needed at least annually. We also encourage you to schedule an appointment with Ruth or Christine to review your estate plan if your family, health or financial circumstances have changed significantly since our last meeting, or if we have not reviewed your estate plan within the past 7-10 years.

In many ways, technology has dramatically improved the practice of trust and estate law. It has also increased the speed by which we can communicate with each other and our expectation for a prompt response. We are happy to hear from you whenever you have questions about your estate plan. We recognize that each of your questions is important and appreciate your patience when we cannot respond immediately. We trust, however, that you will recognize the value of our time and expertise when we review your file, answer your letters and e-mails, and talk with you on the phone and in person.

After we have completed all presently foreseeable work on a file, we will store it as a closed file for a number of years. Eventually, however, we recognize that a closed file will never be needed for any purpose. Accordingly, several years ago, we developed a file destruction policy for closed files. Under this policy, we will destroy all closed files which have remained closed for at least 10 years and which we do not anticipate will be needed at any time in the future. File destruction will be carried out in conformity with our obligation to keep your affairs confidential. Of course, we will not destroy estate planning files for living clients or the original estate planning documents that we are holding for you in our vault for safekeeping. By example, we will destroy estate administration files which have been closed and inactive for at least 10 years. Please let us know if you have any questions or concerns about this policy or if you would like to retrieve any closed file which would otherwise be destroyed in accordance with this policy.

Ruth and Christine were honored once again to be listed in the October issue of New Hampshire Magazine as top attorneys in trust and estate law. In 2007, Ruth celebrated her 25^th year practicing law with profound appreciation to all of the clients with whom she has had the pleasure of working during these years. We all look forward to working with you for many more years to come.

In the more immediate future, however, we plan to close our office from December 24 through December 28. If we do not see you before then, we wish you very happy holidays.

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Autumn 2006

With the changing of the leaves, we are pleased to send you this annual summary of the most significant changes to the federal and New Hampshire laws which affect estate planning, and estate and trust administration. We hope that you find this information helpful.

In 2007, the federal estate, gift and generation skipping transfer tax exemptions will be unchanged. The estate and generation skipping transfer tax exemptions will remain at $2,000,000, the gift tax exemption will remain at $1,000,000, and the annual gift tax exclusion will remain at $12,000. Estate tax will be applied at the flat rate of 45% for estates in excess of the exemption. A bill to extend and reform the estate tax after the currently scheduled phase-out in 2010 was pending before Congress this year. That legislation did not pass, but it is likely that there will be legislation to change these taxes before 2010. We will keep you posted.

President Bush signed the Pension Protection Act of 2006 on August 17, 2006. Under this Act, for 2006 and 2007, individuals over age 70½ are allowed to direct that a distribution of up to $100,000 each year will go directly to a public charity. This distribution will not be counted as income and there will be no corresponding charitable deduction, effectively avoiding the charitable deduction limitations. Also under this Act, a nonspouse beneficiary of an employer sponsored retirement plan may have the distribution sent to an IRA. The IRA would be taxed under the same minimum distribution rules as an inherited IRA. (Under some employer sponsored retirement plans, nonspouse beneficiaries could previously be forced to take a lump-sum distribution.)

In last year’s annual letter, we advised you of changes to the New Hampshire law which made Medicaid planning more difficult. This year, changes to federal law along with coordinating revisions to New Hampshire law continue that trend. There is now a 5 year look back period, instead of a 3 year period, for outright gifts. Also, the disqualification period will begin after a person would otherwise qualify for Medicaid, instead of beginning on the date of the gift. Accordingly, each person must retain sufficient assets and income to pay for 5 years of care before making any gifts. This rule will apply to all gifts made after February 8, 2006. Please call our office to schedule an appointment to discuss these issues, if they are a concern for you.

Also significant, the State agency that administers Medicaid in New Hampshire issued a notice in December 2005, retroactively effective to April 1, 2004, to treat a home placed into a trust as a countable resource if either the Medicaid applicant or spouse is a beneficiary of the trust, whether the trust is revocable or irrevocable. A home is not a countable resource if the Medicaid applicant’s spouse lives in the home and it is not owned by a trust. Accordingly, consideration should be given to the withdrawal of the home property from a revocable trust if a married Medicaid applicant enters a nursing home. Whether or not a home owned by an irrevocable trust will be a countable resource will be determined on the basis of the rights granted or retained by the Medicaid applicant or spouse. Each trust must be evaluated if a beneficiary enters a nursing home.

Effective January 1, 2007, New Hampshire has a new law for advance directives. Living Wills and Powers of Attorney for Health Care signed after 2006 will be governed by the new law. Living Wills and Powers of Attorney for Health Care signed under the current law will remain effective after 2006, as are documents executed in other states, subject to the requirements of New Hampshire law. Under the new law, health care providers are permitted to give or withhold treatment over a person’s objection if the advance directive includes the following statement, initialed by that person: "Even if I am incapacitated and I object to treatment, treatment may be given to me against my objection." Changes are also made to Living Wills. If you are interested in updating your Power of Attorney for Health Care and Living Will, please call our office and ask Lori Anders to prepare these documents. For $50 per person, we will send you the new forms in late December, to be executed on or after January 1, 2007.

The law which addresses Living Wills and Powers of Attorney for Health Care also establishes procedures for Do Not Resuscitate Orders, which are obtained from a physician or certain nurse practitioners. Under this new law, your health care agent will have authority to consent to a Do Not Resuscitate Order on your behalf.

New Hampshire adopted a comprehensive law called the Trust Modernization and Competitiveness Act. The purpose of this legislation was to make New Hampshire a desirable location for trust companies and trust administration. Asset protection provisions were proposed but not adopted. Private trust companies may now be established in New Hampshire to serve members of very wealthy families. This legislation also officially recognizes the fiduciary roles of a trust advisor and a trust protector, providing both greater flexibility and protection in the administration of New Hampshire trusts. The Uniform Principal and Income Act was also adopted as part of this legislation, to be effective after 2006. This law operates when the terms of a will or trust are silent on the allocation of income and principal. Our wills and trusts specifically authorize the fiduciary to allocate income and principal fairly and equitably.

Attorney Erin G. Hendrick joined us in September. Erin clerked for Justice Duggan of the New Hampshire Supreme Court for a year after completing Northeastern University School of Law in 2005. Erin joined our firm to practice trust and estate law. If you have the opportunity to work with Erin this year, we are sure that you will enjoy the experience.

We were sad to lose Judy Belanger and Vicky Gaudreau, both of whom moved out of New Hampshire this year. We have three new legal assistants: Jill Landry, Lori Anders and Jennifer Pierce. We are delighted to have the opportunity to work with Jill, Lori and Jennifer.

As you may have seen, Ruth and Christine were honored to be listed in the October issue of New Hampshire Magazine as top attorneys in Trusts and Estates.

Looking ahead to the holidays, we plan to close the office from December 23 through January 1. If we do not see you before then, we wish you very happy holidays.

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Autumn 2005

Significant changes in federal and New Hampshire laws this year affect trusts and estates, both large and small. We hope that our explanation of these changes will help you to plan more effectively for the future disposition of your estate.

Under federal law, the estate tax exemption will increase to $2,000,000 in 2006 and estate tax will be applied at the flat rate of 46% for estates in excess of this amount. The generation skipping transfer tax exemption will also increase to $2,000,000. The gift tax exemption will remain at $1,000,000 for lifetime gifts, however. It is expected that the annual gift tax exemption will increase to $12,000 per donee in 2006. Additional changes to these laws can be anticipated within the next few years. We will keep you posted on these developments.

New Hampshire currently has no estate or inheritance tax. As a result, the administration of estates and trusts in New Hampshire is considerably simpler now than in previous years.

To the contrary, Medicaid planning is now more difficult. New Hampshire recently changed the law which governs eligibility for Medicaid assistance. Under the revised law, property which was previously protected from a Medicaid lien through a life estate or irrevocable trust arrangement may be partially subject to a lien upon the death of the Medicaid recipient. The revised law applies to all life estates and irrevocable trusts, whether created before or after the law change.

New Hampshire has also proposed changes which will be effective only if the state receives a waiver of federal law. These changes include an extension of the look-back period to 5 years for all gifts and a delay in the application of the disqualification period to the date when Medicaid assistance would otherwise be available. In other words, if you make a gift within 5 years before applying for Medicaid assistance, you will be disqualified for a period of time starting when you would otherwise be eligible to receive Medicaid. Under prior law, if you made a gift within 3 years, the disqualification period would have started when the gift was made. It is uncertain if the federal government will grant a waiver for these changes to become effective. As proposed, however, they will apply for gifts made after March 14, 2005 and for Medicaid applications filed after August 29, 2005.

If you have a life estate or irrevocable trust designed for Medicaid protection, or if you made gifts after March 15, 2005 in anticipation of Medicaid assistance, you may want to review your options under the new law. Please call our assistant, Jodi Paul, to schedule a meeting if you would like to discuss this issue with either of us.

2005 technical changes to the Uniform Trust Code included confirmation that the notice and reporting requirements apply only to irrevocable trusts created and trustees taking office after October 1, 2004. Under these rules, qualified beneficiaries of a trust must receive notice that they are entitled to see a copy of the trust and to receive a copy of the annual account.

Last spring, the termination of artificial life support gained national attention for a brain injured woman in Florida. We encourage each of you to give this matter your individual attention by confirming that you have designated an appropriate agent to make health care decisions in the event of your lifetime incapacity.

We are pleased to announce that Christine has been nominated to the American College of Trust and Estate Counsel, an honor bestowed on attorneys who are selected by their peers for distinguished service in the practice of estate planning, probate and trust law. Ruth has enjoyed membership in this national organization since 1995, serving as the New Hampshire state chairperson from 1999 - 2004.

Looking ahead to the holidays, we plan to close the office from December 24 through January 1. If we do not see you before then, we wish you very happy holidays.