My daughter Maggie I recently have had a couple of situations where minor children are heirs of a parent that passed away. As a result, the minor children are beneficiaries of their parent's estate. However, in Iowa, it can be a challenge when a minor is inheriting money/assets. Iowa law provides that if the amount of the inheritance is above $25,000, it is necessary that a conservatorship be opened for the minor. A conservatorship, while beneficial in handling the assets for a minor that can't handle those assets, can be a challenge and potentially frustrating experience. Some issues associated with a conservatorship: Annual reporting requirements - each year (or occasionally other periods) a report is filed and review by the court for all income and expenses of the conservatorship. Annual expenses - there are annual court costs and potentially attorney fees to handle those reports. Bonding requirements - a conservator has to post an insurance bond before th
Showing posts from February, 2012
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With a recent ISU survey showing Iowa farmland values continuing to skyrocket , there is an increase in attention to dealing with the big values involved. Some issues to keep in mind when your estate involves Iowa farmland: "Death Taxes" - For 2012, the federal estate tax exemption amount is $5M , which excludes are large portion of the individuals dying in 2012. However, for the larger estates, or estates with significant life insurance or retirement plans, there may be some issues. Also, in less than a year, the exemption amount is scheduled to be reduced back to $1M. With just a 150 acre farm, at average values, you potentially have estate tax exposure. Disputes - Handling the farm if there is more than one child can be challenging. What if there is one child that is involved in farming and one that isn't? What if neither are involved? What if the kids don't get along with each other? How will decisions be handled in the future when there are multiple
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Iowa law limits the time period in which to administer an estate of an Iowa decedent. Iowa Code section 633.331. If an estate is not opened up within 5 years after death of the decedent, it will not be able to opened up. Iowa currently does not recognize any exception to this rule. What does that mean? If there is a will and you wait more than 5 years after death before doing anything, you've waiting too long. Good luck on the headaches of transferring any assets at that point. This doesn't mean that you always have to probate an estate, but if there are any possible assets that may need to be distributed, don't wait.