James R. Wade’s 50th Year of Practicing Law!

This year marks the 50^th year of practicing law for James R. Wade! To date, he has had a long and distinguished career which includes his stint as a Denver Probate Judge, as the author of The Colorado Probate System and the Colorado Law of Wills, Trusts and Fiduciary Administration. He has served as advisor to various national commissions on probate and trust law standards and is a member of the National College of Probate Judges, the International Academy of Estate and Trust Law, and the American College of Trust and Estate Counsel. Mr. Wade is a member of the Joint Editorial Board for the Uniform Estate and Trusts Acts. His practice focuses on the areas of estate and trust planning, estate and trust administration, and estate and trust litigation. For more information, go to the firm's website at http://www.wadeash.com/.

May, 2012 Fraud Alert

This month's Consumer Fraud Alert which is issued by the Denver District Attorney's Office is titled Identity Thieves Benefit by Stealing Social Security Numbers. The Alert lists some common signs that should alert you to the fact that you may have become a vicitim of identity theft, as well as the steps to take if it happens. For more information, go to May 2012 Consumer Fraud Alert.

Do You Have a Social Media Will?

Have you thought about what will happen to your social media accounts (Facebook, LinkedIn, etc.), your paypal account, etc. when you die? You may have executed a written Will to take care of your home and other assets, but what about your online assets? For more food for thought, go to The Hot Button Blog.

James Wade & Herb Tucker Speaking at 32nd Annual Estate Planning Retreat

James Wade and Herb Tucker (along with Keith Lapayude) will be speaking at the 32nd Annual Estate Planning Retreat to be held June 7-9, 2012 in Breckenridge, Colorado. The session, entitled "How to Attack and Defend Expert Witnesses in Trust and Estate Litigation" will cover many topics including the selection and engagement of experts, deposing and cross-examining your opponent's expert and evidentiary rules regarding the qualification of experts. For more information, go to 32nd Annual Estate Planning Retreat.

The U.S. Supreme Court and Frozen Sperm

On May 21, 2012, the Supreme Court ruled in Comm’r of Social Security v. Capato, No. 11-159 that Social Security benefits are payable only to "children" as defined in applicable state law, and that under Florida law in that case, children conceived after the decedent’s death using his frozen sperm were not his "children." Effective July 2010, Colorado adopted changes to the Uniform Probate Code, in which children conceived within three years after the decedent’s death using frozen sperm in certain circumstances will be "children" for purposes of the Colorado intestate statutes and class gifts. C.R.S. 15-11-121(8). Therefore, after July 2010, a Colorado decedent will have a different result than the Capato case. For more information about this topic, go to our June 2010 Wade Ash Newsletter or go to the Wall Street Journal article.

Cost of Living Adjustments to Probate Code

Effective January 1, 2012, certain figures in the Colorado Probate Code were adjusted for inflation, pursuant to the 2010 addition of C.R.S. 15-10-112 to the statutes, but such adjustments are only made where the increase or decrease is in increments of $1,000. The Colorado Department of Revenue is supposed to release the numbers by February 1, but this was the first year for this requirement, and apparently they had not been informed by the legislature! The numbers that change are as follows:

Description	2011 amount	2012 amount
Initial intestate share for spouse where parent survives decedent	$300,000	$309,000
Initial intestate share for spouse where spouse has children from prior marriage	$225,000	$232,000
Initial intestate share for spouse where decedent had children from prior marriage	$150,000	$154,000
Supplemental elective-share amount	$50,000	$51,000
Small Estate Affidavit limit	$60,000 (as of August 2011, increased from $50,000)	$61,000
Exempt Property	$26,000	$30,000 per statute change, not COLA adjustment
Family Allowance	$24,000	$30,000 per statute change, not COLA adjustment

Note that the increase in the small estate affidavit limit to $61,000 creates a disconnect from the total of the Exempt Property and Family Allowance amounts.

SB 12-131 Passed by Legislature

This bill protects a personal representative and trustee from liability for distribution of an estate or trust without regard to a valid designated beneficiary agreement so long as the fiduciary does not have actual knowledge of such an agreement, and the fiduciary reviewed the county records for a recorded designated beneficiary agreement in the counties in which the decedent was domiciled within three years before death.

IRS Expands Penalty and Installment Payment Relief

The IRS announced that it has expanded its "Fresh Start" initiative to help struggling taxpayers by providing late payment penalty relief and making installment agreements available to more taxpayers. Failure to pay penalty relief applies to two categories of taxpayers: (1) wage earners who have been employed at least 30 consecutive days during 2011or in 2012 (up to the April 17^th filing deadline); and (2) self-employed individuals who experienced a 25% or greater reduction in business income in 2011, due to the economy. To qualify, the taxpayer’s income must not exceed $100,000 for single and head of household filers or $200,000 for joint filers. In addition, the 2011 tax liability due cannot exceed $50,000. To seek relief, the taxpayer must file Form 1127-A, Application for Extension of Time for Payment of Income Tax for 2011 Due to Undue Hardship. Those qualifying for relief will avoid the penalty until October 15, 2012, but will be responsible for interest on the tax until paid. With respect to installment agreements, the IRS has raised the threshold limit to $50,000, meaning that taxpayers who owe up to $50,000 in back taxes may qualify for an installment agreement without having to provide financial information to the IRS. In addition, the IRS extended the maximum term for installment agreements to 72 months.

HB 12-1074 Passed by Legislature and Sent to Governor

This bill grants the courts access to contact information from other state agencies for guardians and conservators who fail to timely file required reports. This will add to the court’s options for contacting fiduciaries to obtain such reports. The Denver Probate Court has been issuing Letters to guardians and conservators that expire on the date such reports are due, and will only be re-issued once the reports are filed.

Do Children Born Post-Death of a Parent Qualify for Social Security Benefits?

On March 19, the U.S. Supreme Court will consider the case of Karen Capato, who is trying to receive Social Security survivor benefits for her children who were born after the death of her husband, using in vitro fertilization. In 2000, Robert Capato was diagnosed with cancer and, as a precaution, froze sperm with a fertility clinic, out of concern that the treatment would render him sterile. Robert and Karen decided before Robert’s death to use the frozen sperm to conceive a child, as a sibling to their son. Robert died in 2002, and Karen gave birth to twins in 2003. She then applied for Social Security survivor benefits for the twins, but was denied. The government says this is because of the inheritance laws in effect in Florida (where the Capatos reside) which states that children conceived after the death of a parent cannot inherit property unless specifically provided for in a Will. Mrs. Capato argues that under the 1938 Social Security Act, survivor benefits go to any "child" of a covered individual, and that includes biological offspring of a married couple. The Florida law would only come into play if biological parentage is uncertain. A federal appeals court in Philadelphia ruled in favor of Mrs. Capato last year. There are currently an estimated 100 similar cases pending with the Social Security Administration.