April 18, 2013 – Dedicated to Professor Dennis Calfee – Obama’s 2014 Budget Proposals, New Florida Medical Malpractice Laws Passed and the $41.7 Million Dollar Tick Bite
We are celebrating Professor Dennis Calfee’s installation as Tax Lawyer of the Year by the Tax Section of the Florida Bar at Its 35th Annual Meeting.
Don’t miss this fantastic event Saturday evening in Gainseville, or Professor Calfee will change your grade in Trusts and Estates or Partnership Tax and you will have to take it over!
Professor Calfee is the proud recipient of the Thursday Report Tax Lawyer of the Week, and was presented with a bucket of Kentucky Fried Chicken by the Thursday Report in conjunction with his Research Seminar Class.
“And thanks for the “A” in Partnership Tax in 1982. You must have confused my exam with someone else’s.” – Alan Gassman
“It is a privilege to be in the Florida LL.M. Program and to have Professor Calfee as a professor and mentor. He deserves so much more than just a bucket of chicken from KFC, but let’s not unduly spoil him.” – Rachel Barlow, J.D. – LL.M. Class of 2013
Professor Calfee earned his bachelor’s degree magna cum laude and juris doctorate from Gonzaga University and his master’s degree of laws in taxation from the University of Florida. He joined the Fredric G. Levin College of Law in 1975 as an Interim Visiting Assistant Professor and remains there 32 years later. Professor Calfee has also served as a visiting faculty member at Peking University, Beijing, China; University of Leiden, Netherlands; Academy of International Tax, Taipei, Taiwan; and University of Montpellier, France.
In 2006, Professor Calfee was awarded one of Taiwan’s most prestigious honors, the Public Finance Specialty Medal, for his 20 years of service to develop public finance in the Republic of China and train local tax officers to deal with international tax affairs. In 2008 Professor Calfee was named a Distinguished Accredited Estate Planner by the National Association of Estate Planners and Councils. Of note is that at the time of the award Professor Calfee was only the third professor awarded this honor. Prior recipients of the award include Howard M. Zaritsky, Byrle M. Abbin, Roy M. Adams, Steve R. Akers, Lawrence Brody, Natalie B. Choate, Richard B. Covey, S. Stacy Eastland, and Stephan R. Leimberg.
Professor Calfee is a co-author of “Federal Estate and Gift Taxation” along with Richard B. Stephens, Stephen A. Lind, Guy B. Maxfield, and Robert B. Smith. Professor Calfee currently teaches Taxation of Gratuitous Transfers, Income Taxation, and Income Taxation of Estates & Trusts at the Fredric G. Levin College of Law.
You can email your congratulations to Professor Calfee and thank him for what he has done for our tax community by clicking here.
PRESIDENT OBAMA’S APRIL 10, 2013 PRONOUNCEMENT OF 2014 BUDGET PROPOSALS – A $3.5 MILLION ESTATE GENERATION SKIPPING TAX AND GIFT TAX EXEMPTION AND A 45% ESTATE AND GENERATION SKIPPING TAX RATE!
TWO GOOD MEDICAL MALPRACTICE LAWS PASSED BY THE SENATE LAST WEEK: 1. TREATING DOCTORS CAN CONSULT WITH ATTORNEYS AND 2. REQUIRING THAT TESTIFYING EXPERTS BE OF THE SAME SPECIALITY AS THE DEFENDANT
THE $41.7 MILLION DOLLAR TICK BITE – THE REASON YOUR CLIENTS NEED ASSET PROTECTION
We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Ruggiero at Janine@gassmanpa.com.
PRESIDENT OBAMA’S APRIL 10, 2013 PRONOUNCEMENT OF 2014 BUDGET PROPOSALS – A $3.5 MILLION ESTATE GENERATION SKIPPING TAX AND GIFT TAX EXEMPTION AND A 45% ESTATE AND GENERATION SKIPPING TAX RATE!
A $1 million gift tax exemption!
Clients who have used their $5,250,000 present gift tax exemption, or most of it, will be pleased to have done so if this takes effect.
We expect no clawback risk.
Proposals would also cause assets under a “defective grantor trust” to be subject to estate tax if there has been a sale of assets to the trust.
The law would also limit the duration of generation skipping tax exempt trusts to the 90th anniversary of the creation of the trust. Grantor retained annuity trusts would be required to have a positive remainder interest upon funding.
We are hopeful that none of these proposals would come into effect, and thankful that there was no proposal to do away with discounts for closely held family businesses and investment entities.
This does show, however, that the $5,250,000 per person estate tax exemption is not beyond being adjusted downward if the budgetary issues that our country faces are not addressed in another way.
These proposed changes are contained within the “Strengthening the Middle Class and Making America a Magnet for Jobs” section of the budget, beginning on page 11 (click here for a copy of this section), and the “Reducing the Deficit in a Smart and Balance Way” section of the budget (click here for a copy of this section). A complete copy of the budget can be located on the White House’s website here. For a copy of the Treasury Department’s Greenbook, (General Explanations of the Administration’s Revenue Proposal), click here.
TWO GOOD MEDICAL MALPRACTICE LAWS PASSED BY THE SENATE LAST WEEK: 1. TREATING DOCTORS CAN CONSULT WITH ATTORNEYS AND 2. REQUIRING THAT TESTIFYING EXPERTS BE OF THE SAME SPECIALTY AS THE DEFENDANT
The Florida Senate passed Senate Bill 1792 last week by a vote of 27-12. The Senate Bill will help alleviate two big problems in the medical malpractice world by allowing treating doctors to consult with attorneys and requiring that testifying experts be of the same specialty as the defendant doctor. It will likely soon be considered by the 120 members of Florida’s House of Representatives, where if it achieves passage, it will await the signature of Governor Scott. Click here for a copy of Senate Bill 1792 and here for a copy of the Senate Bill Analysis and Fiscal Impact Statement.
Under current Florida law, a doctor who will be called as a witness or deposed during medical malpractice litigation cannot disclose a patient’s information to his or her own attorney. For example, a doctor treating a patient who has filed suit against a previous doctor will almost certainly be deposed to get the patient’s most up-to-date health information. Prior to the deposition, the doctor would be unable to disclose any protected health information to an attorney under existing law, which effectively prevents meaningful consultation between client and lawyer.
Of course, the general rule in Florida is that a doctor may not discuss a patient’s condition with anyone without the patient’s authorization, with very limited exceptions. Fla. Stat. § 456.057(7)(a). In a typical medical negligence lawsuit context, this means that a doctor treating a patient who is suing a former provider would have to ask the patient’s permission before doing so. Though this would surely make for an entertaining conversation for bystanders, the Florida Senate appears to have recognized this disaccord between encouraging consultation with attorneys and premising it on an awkward and perhaps unattainable authorization. Perhaps, the Senate also considered the possibility that doctors would be more forthright when testifying if they had already spoken with counsel.
Should the Senate Bill become law, a doctor would be able to disclose patient information to their attorney if the doctor “reasonably expects to be deposed, to be called as a witness, or to receive formal or informal discovery requests in a medical negligence action, presuit investigation of medical negligence, or administrative proceeding.” The legislation also provides that the attorney may not then turn and disclose the information to the doctor’s liability insurance carrier (with an exception for billing information) if the doctor shares the same insurance carrier as a defendant or potential defendant in the litigation. Additionally, the law would prevent liability insurance companies from selecting the doctor’s attorney, though it does permit a (perhaps very persuasive) recommendation. In other words, insurance companies will be unable to make an end run around attorney-client and doctor-patient confidentiality rules.
Another part of the Bill would amend Florida’s law regarding the qualification of doctors testifying as experts. Under Fla. Stat. § 766.102(5)(a)(1), a doctor may testify in a medical negligence suit if he or she is a specialist in the same or similar specialty as the defendant doctor. S.B. 1792 would remove the necessity of judicial interpretation of the word “similar” by requiring that testifying experts be of the same specialty as the doctor being sued. Of course, now judges will have to listen to an attorney proffer an expansive definition as to what constitutes the “same” specialty, but as our mothers always taught us, one undefined adjective is better than two.
THE $41.7 MILLION DOLLAR TICK BITE – THE REASON YOUR CLIENTS NEED ASSET PROTECTION
In a stunning recent decision, a Massachusetts jury awarded a former high school student, Cara Munn, $41.7 million dollars after she contracted tick-borne encephalitis while on a school trip to rural China. The encephalitis has resulted in brain damage and left her unable to speak. The jury ruled that The Hotchkiss School, “an elite 122-year-old private school” with an annual tuition of “up to $46,775,” was liable because it “failed to ensure that the students took the necessary precautions against tick” on the trip. Ms. Munn’s attorneys also alleged that the school allowed students “to walk through a densely wooded area known to be a risk for tick-borne encephalitis,” among other diseases.
While this is certainly a tragedy for Ms. Munn and her family, this case once again highlights why clients, and particularly businesses, must fully utilize asset protection. Businesses simply can’t plan for or eliminate all risks, no matter how remote or unlikely-like encephalitis from a tick bite in rural China. Instead, businesses must plan for the big risks and use asset protection, such as insulating assets among separate LLCs, to protect against the unlikely or unforeseen risks.
For more on the case, click here for NBC’s story.
APPLICABLE FEDERAL RATES
Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.
SEMINARS AND WEBINARS
SEMINARS:
THURSDAY, MAY 16, 2013.
The Florida Bar Annual Wealth Protection Seminar:“How a Lawyer Can Protect a Client’s Wealth.” Mark your calendars for this exciting event in Miami, Florida. Speakers include Jonathan Alper, Esq. on Where Does Florida Law Stand on Fraudulent Transfers; Mitchell Fuerst, Esq. on Introduction to Professional Privilege in Wealth Protection Cases – Civil v Criminal; Tax v Non-Tax; When to Claim the Fifth; How to Do it Right; Michael Markham, Esq. on Recent Asset Protection Case Decisions, Legislation, and Their Importance in Protection Planning; Denis Kleinfeld, Esq. on Where to Situs a Trust – An Analysis of U.S. Asset Protection States; and Alan Gassman, Esq. on Using Estate Planning Techniques to Optimize Family Wealth Preservation. For more information please click here to view the brochure or email agassman@gassmanpa.com
WEBINARS:
TUESDAY, APRIL 23, 2013, 5:00 – 5:30 pm.
Please join us for a webinar on The Ten Biggest Mistakes Consumers Make with guest speakers Bill Kahn and Melissa Allums. This webinar will feature topics such as identity theft, victimization, false advertising and many more. To register for this webinar please click here or email janine@gassmanpa.com
THURSDAY, APRIL 25, 2013 4:00 – 4:50 p.m.
Please join us for the 44 Show – a monthly CLE webinar sponsored by the Clearwater Bar Association and moderated by Alan S. Gassman. This month’s topic is Reading Surveys and Legal Descriptions: Reviewing Surveys in Actual Practice. To register for the webinar please visitwww.clearwaterbar.org or email janine@gassmanpa.com
MONDAY, MAY 6, 2013, 12:30 – 1:00 p.m. On the first Monday of each month the Clearwater Bar Association presents Lunch Talk. A free monthly webinar series moderated by Alan S. Gassman. This month’s speaker is Mike Shea speaking on Your Law Firm Insurance Pacakge. To register for the webinar please visit www.clearwaterbar.org or email Janine@gassmanpa.com
Alan S. Gassman, J.D., LL.M. is a practicing lawyer and author based in Clearwater, Florida. Mr. Gassman is the founder of the firm Gassman, Crotty & Denicolo, P.A., which focuses on the representation of physicians, high net worth individuals, and business owners in estate planning, taxation, and business and personal matters. He is the lead author on Bloomberg BNA’s Estate Tax Planning and 2011 and 2012, Creditor Protection for Florida Physicians, Gassman & Markham on Florida and Federal Asset Protection Law, A Practical Guide to Kickback and Self-Referral Laws for Florida Physicians, The Florida Physician Advertising Handbook and The Florida Guide to Prescription, Controlled Substance and Pain Medicine Laws, among others. Mr. Gassman is a frequent speaker for continuing education programs, publishes regularly for Bloomberg BNA Tax & Accounting, Estates and Trusts Magazine, Estate Planning Magazine and Leimberg Estate Planning Network (LISI). He holds a law degree and a Masters of Law degree (LL.M.) in Taxation from the University of Florida, and a business degree from Rollins College. Mr. Gassman is board certified by the Florida Bar Association in Estate Planning and Trust Law, and has the Accredited Estate Planner designation for the National Association of Estate Planners & Councils. Mr. Gassman’s email is Agassman@gassmanpa.com.
Thomas J. Ellwanger, J.D., is a lawyer practicing at the Clearwater, Florida firm of Gassman, Crotty & Denicolo, P.A. Mr. Ellwanger received his B.A. in 1970 from Northwestern University and his J.D. with honors in 1974 from the University of Florida College of Law. His practice areas include estate planning, trust and estate administration, personal tax planning and charitable tax planning. Mr. Ellwanger is a Fellow of the American College of Trusts and Estates Counsel (ACTEC). His email address istom@gassmanpa.com.
Christopher Denicolo, J.D., LL.M. is a partner at the Clearwater, Florida law firm of Gassman, Crotty & Denicolo, P.A., where he practices in the areas of estate tax and trust planning, taxation, physician representation, and corporate and business law. He has co-authored several handbooks that have been featured in Bloomberg BNA Tax & Accounting, Steve Leimberg’s Estate Planning and Asset Protection Planning Newsletters, and the Florida Bar Journal. He is also the author of the Federal Income Taxation of the Business Entity Chapter of the Florida Bar’s Florida Small Business Practice, Seventh Edition. Mr. Denicolo received his B.A. and B.S. degrees from Florida State University, his J.D. from Stetson University College of Law, and his LL.M. (Estate Planning) from the University of Miami. His email address is Christopher@gassmanpa.com.
Kenneth J. Crotty, J.D., LL.M., is a partner at the Clearwater, Florida law firm of Gassman, Crotty & Denicolo, P.A., where he practices in the areas of estate tax and trust planning, taxation, physician representation, and corporate and business law. Mr. Crotty has co-authored several handbooks that have been published in BNA Tax & Accounting, Estate Planning, Steve Leimberg’s Estate Planning and Asset Protection Planning Newsletters, Estate Planning magazine, and Practical Tax Strategies. Mr. Crotty is also the author of the Limited Liability Company Chapter of the Florida Bar’s Florida Small Business Practice, Seventh Edition. He, Alan Gassman and Christopher Denicolo are the co-authors of the BNA book Estate Tax Planning in 2011 & 2012.His email address is Ken@gassmanpa.com.
Thank you to our law clerks that assisted us in preparing this report:
Kacie Hohnadell is a third-year law student at Stetson University College of Law and is considering pursuing an LL.M. in taxation upon graduation. Kacie is also the Executive Editor of Stetson Law Review and is actively involved in Stetson’s chapter of the Student Animal Legal Defense Fund. In 2010, she received her B.A. from the University of Central Florida in Advertising and Public Relations with a minor in Marketing, and moved to St. Petersburg shortly after graduation to pursue her Juris Doctor. Her email address is Kacie@gassmanpa.com
Eric Moody graduated from Stetson University College of Law in December 2012 and is currently seeking admission to the Florida Bar. He is considering pursuing an LL.M. in estate planning. While at Stetson, Eric was an Articles and Symposia Editor for the Stetson Law Review. In 2009, Eric received a B.S. in Business Management from the University of South Florida. Eric’s email address is Eric@gassmanpa.com
Carly Ross is a third-year law student at Stetson University College of Law. She is the Notes and Comments Editor for Stetson Law Review, and a member of Stetson’s Jessup Moot Court Team. She graduated from the University of North Carolina at Chapel Hill in 2010 with majors in History and Political Science. Carly’s email is Carly@gassmanpa.com
Jonathan DeSantis is in his final year at Stetson University College of Law. Originally hailing from the Philadelphia area, Jonathan received a B.A., with honors, in Criminal Justice from Temple University. Jonathan serves as a Senior Associate on the Stetson Law Review and is the immediate past president of the American Constitution Society. His email address is Jon@gassmanpa.com