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Lawrence Scherer, Esq., CPA, LL.M. Taxation
Estate Planning Technique of the Month: Avoiding Probate; How to Quicken-Up Transfers to Your Heirs.
Many of our readers are already aware that for the most part; people who have written a Will and people who fail to Write their own Will, have to go through a process in the New York courts. Generally, for a Will, you need to “probate” in order to implement its terms, while without a Will, you need to “Administer” an intestate estate. Both of these processes are run through a special court called the Surrogate’s Court. Only a few years back, the NY Surrogate’s Court was the fastest and easiest court in the Country. But not anymore. What used to take a few weeks is now taking 6 to 8 months (and sometimes much much longer). Why, you may ask; it’s because of technology! In the old (meaning pre-COVID) days, we stood online, spoke with a probate clerk and if required, received directions as to how to follow-up. Now we upload all documents into a computer portal and receive a filing confirmation. The review of the uploaded papers may happen in a few months. There is almost no direct contact with the clerks and things just seem to drag along SLOWLY. So how do you speed things along? What we do now is draft a revocable living trust (“RLT”). Your RLT holds all of your property during your life without anything changing except that you are now a Trustee of your own trust. When you die, the RLT instantly transfers management of your property to your successor Trustee who arranges to pay off your debts and then distribute the remainder of the trust’s assets to your beneficiaries in the manner you provided in the trust agreement. Because trust don’t die (they merely change beneficiaries), the distribution to your beneficiaries moves much faster. In a typical RLT you will be your own trustee for the remainder of your life. In your RLT, you name one or more successor trustee(s) to administer the trust property and distribute the trust property to the individuals to whom you intended to provide and in the manner you provided. RLTs do not offer any tax benefits that a Will could not also provide. They only avoid probate, but that is benefit enough. There are two non-tax benefits to using an RLT. The RLT can hold your property for your benefit if you become incapacitated and avoids the need to have a Guardian of your property appointed. The other RLT benefit is that since all the assets are titled in the trust, we can convert the RLT into an irrevocable Medicaid Asset Protection Trust and all of the property in the Trust starts the look-back period on the same day.
Gov. Kathy Hochul Proposes New Law to Make More Homes Available to Purchase by Individuals.
The Gov. Proposed new legislation that will require a 75-day waiting period before covered institutional investors can make purchase offers on one- or two-family homes in New York. The purpose of her proposal is to discourage private equity firms and investor groups from buying up real estate inventory before resident individuals can see property(s), thus making more properties available to families. She posited that “We need to level the playing field and make sure that institutional investors are not taking away opportunities from individuals and families who have spent their lives saving to become homeowners,” …. “New York is the best state to start a family, and I am always committed to taking action to ensure that homeownership becomes more attainable for New Yorkers.” Under her proposal large investors will be required to wait 75 days before making an offer on one- or two-family homes. Violators would face penalties of up to $250,000. Additional provisions in her new proposal would add $100 million incentives towards building more starter homes and support first time homebuyers with down payment assistance.
Virginia to Require Some Drivers to Install Speed Limit Devices
In Virginia, a driver who received a speeding ticket could be directed to install a device to limit their car’s speed. Virginia would be the first State to mandate speed limiters for certain drivers with a heavy foot. Under the new legislation, judges will have the authority to require reckless drivers to install the devices as an alternative to losing their license or facing jail time. The move follows a similar law passed in the District of Columbia last year, and with states like Maryland eyeing comparable measures, this could mark the beginning of a broader crackdown on dangerous driving across the region. Advocates of the new law, pushed for the legislation to apply automatically to anyone caught driving over 100 mph. But Gov. Glenn Youngkin left automatic application off and giving discretion to apply the speed limiter on a case-by-case basis. The device could use either GPS or traffic sign recognition systems to control your speed. It’s possible that a convicted driver would be responsible for cost of installation of the speed-limiting device, which must remain in place for a period of two to six months (depending on the judge’s ruling). And for those thinking about skirting the system, don’t. Attempting to drive another vehicle or tampering with the speed limiter is classified as a misdemeanor, carrying a penalty of up to a year behind bars. While Virginia may be first, it will likely be joined by other states soon.
Nassau County Bar Association (NCBA) Condemned President Trump’s Executive Orders Directed Against Three Law Firms
The NCBA called for the rescission of the Executive Orders Suspending Security Clearance with Government Contracts; and addressing Perkins Coie, LLP and Paul Weiss. In the interest of protecting citizen’s rights under the Constitution (the very foundation of our judicial system), the Nassau County Bar Association condemned these attacks on the right to free speech, right to counsel and restriction on due process and has demanded that the Executive orders impairing such rights be rescinded. By way of background, these Executive Orders target three law firms (Covington & Burling, Perkins Coie, and Paul Weiss) calling for government agencies to suspend their active security clearance, terminate any governmental engagement and limit their access from federal government buildings. These Executive Orders severely punish private attorneys who have represented individuals the Executive Branch deems political adversaries. As a practicing attorney, this commentator joins with the NCBA in denouncing these Executive Orders.
Corporate Transparency Act Mostly Eliminated – What a Long Strange Trip It’s Been!
FinCEN Removed Beneficial Ownership Reporting Requirements for U.S. Companies (and U.S. Persons) and set new deadlines for Foreign Companies. Consistent with the March 2, 2025, announcement, FinCEN has issued an interim final rule that removes the requirement for U.S. companies and U.S. persons to report beneficial ownership information (BOI) under the Corporate Transparency Act. Thus, nearly 33 million small businesses are no longer required to file BOI statements. The new interim final rule requires only entities formed under the law of a foreign country and that have registered to do business in the U.S. (meaning companies previously covered by the “foreign reporting companies” act) to file with FinCEN). Foreign entities that are a reporting company are still required to report their BOI to FinCEN. These foreign entities, however, will not be required to report any U.S. persons as a beneficial owner, and U.S. persons will not be required to report BOI with respect to any such entity. What still remains unclear is the filing requirements for entities whose owners have dual citizenship and reside outside of the US. We expect additional clarification in the near future. Yet, although no US persons need provide BOI information, it appears foreign entities must still report their company applicant (the person who processes the registration to qualify in the US). Reporting companies will have 30 days to file under the revised rules from March 21 or 30 days from the date they qualification to file.
Gov Hochul Signs Bill to Omit Doctor Names on Abortion Pill Prescriptions.
Under a recently enacted law, New York doctors can now omit their names from abortion pill prescriptions. This law is intended to protect Doctors from prosecution by States with strict abortion laws. The law, which lets doctors have only the names of their practices listed on the labels, took effect immediately after being signed by Gov. Hochul.
NY’s Top Court Blocks NYC Law to Allow Non-Citizen Voting
New York’s top court has struck down a law that would have let non-citizens vote in New York City elections. This decision is indicative of the top court’s progressive majority overwhelmingly siding with Republicans who challenged the idea. The law would have made more than 800,000 noncitizens eligible to vote in municipal contests such as mayoral races. The battle centered on language in the New York State constitution (yes New York State has its own constitution) that says “every citizen shall be entitled to vote at every election for all officers elected by the people.” In this regard, the term “citizen” is a condition of eligibility. The highest court in NYS favored this interpretation in a vote of 6 to 1.
Both Tax-Free and Pre-Tax Benefit for Employer-Provided Transportation Costs
For 2025, employer-provided mass transit passes for train, subway and bus systems are tax-free to employees up to $325 per month. The Employer can’t deduct this benefit. But may offer a salary-reduction arrangement to allow you to pay for this benefit with pre-tax dollars. In this manner, the $325 per month at a 24% federal income tax bracket could save the employee $993 in federal income and Medicare taxes yearly. If Social Security tax is also withheld, the employee could save $1,235 yearly. In addition, parking allowances for 2025 are also tax-free up to the same $325 per month. An employee can receive this parking cost fringe benefit on top of the monthly $325 transit passes. For example, you can get $325 per month to pay for the train, plus another $325 to pay the park-and-ride fee at the station. Or you can simply drive to work and get $325 tax-free to help cover parking near the office or worksite.
Trump Issues Executive Order Restoring Public Service Loan Forgiveness
In 2007, Congress established the Public Service Loan Forgiveness (PSLF) Program to encourage Americans to enter the public service sector by promising to forgive some or all of their remaining student loans after they completed 10 years of service in those jobs while making 10 years of minimum payments. Trump posited that Biden abused the PSLF Program with a waiver process that used taxpayer funds to pay off loans for employees still years away from the statutorily required number of payments. In addition, the taxpayer funds did not alleviate shortages in necessary occupations, but rather it was asserted that the PSLF Program has misdirected tax dollars into activist organizations that not only failed to serve the public interest but actually harmed national security and American values. The President issued this E/O ostensibly to end taxpayer subsidization of activities such as assisting illegal immigration. Contrarily, the Secretary of Education shall propose guidelines in conjunction with the Secretary of the Treasury to ensure the definition of “public service” excludes organizations that engage in activities that have a substantial illegal purpose, including aiding or abetting violations of Federal immigration laws; supporting terrorism, or by engaging in violence for the purpose of influencing Federal Government policy; child abuse, including the chemical and surgical mutilation of children (or transporting to so-called transgender sanctuary States); or engaging in illegal discrimination.
More Trump Executive Orders of Interest.
ON VOTING – President Trump has issued an Executive Order (EO) that requires proof of citizenship in order to vote in National Elections. The purpose of this EO is ostensibly to assure only citizens can vote and that the only mail in votes that will be counted will be those received by the close of polling locations in that State. However, the EO is almost guaranteed to evoke serious litigation from the States with whom the power over the method of qualification for voting within that State has historically been left. This EO effectively asserts control over the Election Assistance Commission to enact documentary proof of citizenship requirements for absentee voting and to not count mail-in ballots received after Election Day. These changes are backed by a threat to withhold federal funding. Various State attorney generals have vowed to bring suit.
ON TARRIFFS – On March 27, 2025, President Trump announced that he will impose the promised reciprocal Tariff action raising the previous 2.5% Tariff to 25% effective April 2, 2025. The new tariffs will affect vehicles and auto parts imported into the U.S., escalating the administration’s use of aggressive negotiation in order to bolster domestic auto production. The president stated these new tariffs will add between $600 billion and $1 trillion in revenue for the U.S. over the next two years. This may be an extremely overly enthusiastic estimate as White House staff secretary William Scharf, offered a more conservative estimate at somewhere around $100 billion in new revenue each year.
In addition to being a co-founder of the LIAFPN, Larry Scherer has a strong background in Trust & Estates and Elder Law and serves as Managing Member of Scherer & Pudell, PLLC, a transactional law firm in Garden City, NY. He can be reached at (516) 747-7007. Connect on LinkedIn.
