Hogwash Volume 31

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November 2014
Welcome to Hogwash!

 

Rosi and Gardner

 

If this is the first edition of Hogwash! you’ve received it’s because someone you know thought that you would like to receive it and perhaps pass it on to a friend.   

 

If you enjoy this E-newsletter and know others who you think would like to be on our list or receive a copy by mail, please let us know at info@rosigardner.com   

 

The highest compliment we can receive is a referral from a friend.   Although we’ve been in business together for more than twelve years, have more than 50 years of combined legal experience experience, we are never too busy to help those you refer to us: your family, friends, neighbors, and co-workers.

What Happens When You Die?

 

No, we’re not tackling existential questions here; we’re being more concrete about it.  Specifically, what happens to your stuff, tangible and intangible? The road of inheritance, transfer, and even (gasp!) probate, is riddled with question marks and perceived pitfalls for many people.  Will everything have to be sold?  Do I need a will?  How do I avoid probate?

 

No, it is not certain that everything will have to be sold.  After your death, if there are sufficient assets to pay your legitimate debts, then the remainder of your assets can be distributed according to your wishes.  That is, IF you leave a valid will.  No will?  Then you get the one that the State of Michigan has prepared for you (called “intestacy,” or “without a will”).  That may work for some people, in some circumstances, but most people should leave a clear, simple Last Will & Testament, setting forth their wishes, not those of the State.

 

“But won’t it have to go through probate, if I make a will?” you may ask.  The fact is, your estate will be guided by the probate process whether or not you have a will.  The only way to avoid probate (assuming that you even want to) is to establish a trust AND keep nearly everything “funded” (titled) in the trust (including all real estate, for most people).  If you die with much of anything in your name alone, your estate will be governed and protected by the process of probate.  Often, people create a “living trust” just to avoid probate.  But, if any account, asset, or piece of real estate is not held and kept in the name of the trust, a probate proceeding will be necessary nonetheless.

 

That probate proceeding, though, can and will cover every asset that is in your name at the time of your death.  Once your executor is given authority, by the Probate Court, to act “in your shoes,” she can organize your assets, liquidate them, pay any associated expenses, and pass them along to the individuals, charities, or organizations as you have instructed.  And, without a significant legal contest, your probate estate may even be handled as an “unsupervised, informal” case, with minimal court involvement.

 

The real key to making the division of your assets as smooth as possible is to select an executor that you can rely upon to carry out your wishes, and to make a will that clearly sets forth those wishes.  Your executor can even follow a handwritten list that you leave for her, passing along family jewelry, sentimental heirlooms (that autographed Tigers baseball from the game you saw with your nephew), and antique furniture pieces from your home.  Leaving a clear expression of your wishes, in your will and handwritten list, is the single-best way to avoid family disagreements and conflict.  

 

“So, I should just put everything in joint names, then?”  Don’t do it!  The reasons are many; stay tuned to the next issue for a discussion of some of them.

Issue: 31          
In This Issue
What Happens When You Die?
In Friends We Trust?
National UnFriend Day: A Guide for Dummies
Words of Caution for an Owner of an S Corporation
What does “Michigan Adoption Day” have to do with “Native American Heritage Month?”
Celebrating with Beaujolais Nouveau
Karen’s Home Cooking

 

In Friends We Trust?

      

An old man was on his death bed. He wanted badly to take some of his money with him. He called his priest, his doctor and his banker to his bedside. “Here’s $30,000 cash to be held by each of you. I trust you to put this in my coffin when I die so that I can take all of my money with me.”

 

At the funeral, each man put an envelope in the coffin. Riding away in a limousine, the priest suddenly broke into tears and confessed, “I only put $20,000 into the envelope because I needed $10,000 for a new baptistery.”

 

“Well, since we’re confiding in each other,” said the doctor, “I only put $10,000 in the envelope because we needed a new machine at the hospital which costs $20,000.”

 

The banker was aghast. “I’m ashamed of both of you,” he exclaimed. “I want it know that when I put my envelope in that coffin, it held my personal check for the full $30,000.”

 

National UnFriend Day: A Guide for Dummies

 

 

November 17 is National UnFriend Day-a perfect opportunity to take a cold hard look at your social networking inventory of acquaintances, and systematically eliminate all your friendly surplus. Whether you are a social networking rookie or a professional friend-weeder, here’s a step-by-step guide for an effective UnFriend Day celebration.

 

Preliminary steps: Create a personal account with the social network of your choice (Facebook is the most popular with an estimated 900,000,000 unique monthly visitors). Next, accumulate “friends.” This can happen in many ways. You can search people you know by their names and send them an invitation to take your friendship to the digital level. You also notice that people you have met at various stages of your life (sometimes only once and very briefly) will magically find you.

 

Once you have compiled a friends list with hundreds of names, it’s time to get ruthless and begin the weeding out process. Here are the suggested criteria to follow as you scroll down your list and look at each name:

 

(1) Do you dislike that person? It is not uncommon to receive a “friend request” from that one buddy you chatted with during chemistry class in high school. You accepted the request, of course. That person wasn’t cool then, but neither were you, and it would be great to catch up some time or so you thought. The problem is that, since high school, you blossomed into a respectable human being with values. On the evidence of your buddy’s Facebook posts and “likes,” he or she hasn’t. In fact, you cringe every time you read or see one of his or her posts, which cover a variety of subjects that you either do not care for or strongly disagree with. Verdict: click “Unfriend” and celebrate your freedom of choice.

 

(2) Is that person an ex? Sure, you enjoyed receiving his or her friend request, and interpreted the acceptance as a sign that both of you have “moved on” and can finally be just friends. Then you clicked through the pictures, which included ultrasounds, and you shouldn’t have to read this article to know what to do next. Verdict: end it, and turn the page.

 

(3) Have you seen that person lately? Geographical difficulties aside, regular face-to-face contact is a good indicator of friendship IRL (“in real life”). Some people adhere to hard time limits; if you haven’t seen or talked to so-and-so in over three years, does it make sense to waste your time looking at pictures of their pets?

 

(4) In fact, is your “friend” a pet? Proud pet owners sometimes create separate profiles for their non-human family members. Perhaps they think it is such a sad thing that Mr. Paws will never be able to spend hours in front of a computer screen taking BuzzFeed quizzes, and someone has to do that for Mr. Paws because Mr. Paws is so cute. Either way, it makes no sense. Verdict: keep your pet friendships real. Unfriend the pet profile and notify the pet owner of this silliness.

 

(5) Lastly, has your “friend” invited you to play an online game (for example, Candy Crush Saga)? Unless the two of you have communicated about your mutual appreciation of that game, and actually want to spend time playing simultaneously…

 

Unfriend and be merry!

Words of Caution for an Owner of an S Corporation

 

Many small business have chosen to incorporate, rather than be a Limited Liability Company and have elected to be an S Corporation. Among the benefits of that election is to avoid the corporate tax rates and to the corporate income taxed at the rate of the individual owner – shareholders. Commonly, this is accomplished by treating payments received by the shareholder as distributions, on the theory that as distributions there is no need to file Social Security, Medicare, federal unemployment taxes as well as tax withholding taxes. While that approach may appear to be inviting as a tax saving method, in fact it is a dangerous practice.

 

As a rule, payments to a corporate shareholder who is also actively involved in the management or operation of the business of the corporation is considered, by the IRS, as an employee and payments, albeit described as distributions, are wages, not self-employment income taxes.  When the facts warrant it, the IRS may reclassify only a portion of the payments to shareholder/employees as reasonable compensation, allowing the balance to be considered as distributions. However, establishing a low salaries for the shareholder – officer – employees as the basis for the federal employment taxes and then giving the shareholder a substantially greater distribution has, when addressed by the IRS and the courts, resulted in substantial reclassification of the payments with expensive consequences to the corporation including failure to file penalties.

 

Some have attempted to avoid the employee status classification by the use of employment contracts, seeking to classify an active shareholder as a contract employee, specifying that the shareholder would receive little or no salary, once again to avoid employment taxes. When brought to the attention of the IRS and the courts, such schemes have failed.

 

As the end of the calendar tax year approaches, owner-shareholders of S Corporations are urged to confer with their tax preparer/accountants to be certain that any tax saving strategies that are in place are fully in accord with the rules and regulations of the IRS. No one wants the IRS arriving at their door, raising questions to which the shareholders have no good answers.

What does “Michigan Adoption Day” have to do with “Native American Heritage Month?”  

 

Every year on the Tuesday before Thanksgiving courts around the state celebrate Michigan Adoption Day. Co-sponsored by the various governmental branches, the date educates the public about the adoption process, and serves as an opportunity for participating courts to hold receptions for adoptive families. Nationwide, more than 100,000 children in foster care currently await permanent adoptive families. This year’s Michigan Adoption Day will be celebrated on Tuesday, November 25.

 

Also celebrated in the month of November is the National Native American Heritage Month. This commemoration, first observed in 1990, provides a platform for Native American communities to share and celebrate their culture.

 

“Adoption” and “Native American history” intersect in federal law. In 1978, Congress passed the Indian Child Welfare Act (ICWA) in response to the high rate of removal of Native American children from their families and from Native American culture as a whole. By some estimates, between 25 to 35 percent of all Native American children were being removed from their homes and placed in non-Native homes. Congressional testimony indicated that the per capita rate of Native American children in foster care was nearly 16 times higher than the rate for non-Natives.

 

ICWA sets protections and minimal standards for most custody proceedings involving Native American children, including adoptions. The law gives tribal governments a strong voice in these proceedings, including the ability to, in some situations, transfer cases from state to tribal courts. Although far from a flawless statute, with disputes often making their way up to the U.S. Supreme Court, ICWA’s impact on Native American communities is generally regarded as positive.  

 

If you have questions regarding adoptions, including when the child is of Native American heritage give us a call at (231) 709-4954.

Celebrating with Beaujolais Nouveau

 

Nowhere is the release of Beaujolais Nouveau the first wine of the seasons vintage – celebrated more extravagantly than in France. Since the mid-1980s, though, its also been celebrated by wine enthusiasts throughout Europe and the US.

 

French tradition dictates that third weekend of November is the release date (this year on November 15-16) and celebrations centered on wine and wine production abound. One very special celebration is held in Beaune, in the heart of Burgundy, where for two days wine lovers as well as wine professionals come together to experience the new vintage.

 

The centerpiece of the festivities is a famed wine auction that began in 1859 and today holds international status. The auction benefits the Hospices de Beaune, a charitable organization that has, through donations and bequests, acquired 60 hectares (approximately 150 acres) of vineyard in some of Frances most prestigious wine appellations. The Hospices de Beaune operates a 215 bed hospital as well as provides nursing training and operates a museum in the original Hospices site. To learn more click on this link to the Hospice website.

 

The Hospices vintages are sold by candlelight on the third Sunday of November, but the entire weekend is one of fun and festivities including wine tastings in the caves below the original Hospices. Visitors can also wander the streets of Beaune enjoying the street shows or may be able to take in a concert or special dinner.

 

Here in the United States the tradition of Beaujolais Nouveau is often celebrated at Thanksgiving. Although most French Beaujolais Nouveau wines that find their way to the US are red, their lighter style and fruity nature make them a great accompaniment to the traditional Turkey dinner.

November Special Offer

Leaving town before the closing on your home purchase or sale?
Need to give someone authority to act for you?

 

Durable Power of Attorney:  $250
 

Call us at 941-5878 and mention “Hogwash!” 

Offer Expires 12/15/2014

Karen’s Home Cooking 

 

In my Great Aunt Viola’s farm kitchen, every meal was a comfort meal, but Thanksgiving was an event. She brought out the good china, crystal glasses and freshly washed and ironed (after hanging on the line) linens. I can close my eyes and imagine it, smell it, feel it, taste it.

 

Unfortunately I’m not cooking the big meal this year, but I will be with people I love and am bringing to the meal a side table of simple things to nibble on while we are waiting for the turkey to come out of the oven.

 

Marinated Goat Cheese with Herbs

We’ve had frost at our house but I am still harvesting herbs. Last weekend I cut parsley, thyme, pineapple sage, oregano and basil. I dried them out all week and then ground them fine with sea salt, black peppercorns and juniper berries. I will roll the goat cheese in the herbs and wrap in plastic for a few hours or overnight. When I’m ready to serve I’ll drizzle the cheese with a little olive oil and balsamic and accompany it with crackers. You can use any dried herbs you have on hand or create an herb mix from of the ones you like best.

 

Carrot Parsnip Bites

Slice vegetables in thick slices. In a bowl mix olive oil and salt and pepper, get the veggies saturated and then roast them in a single layer in the oven at 325 degrees for about 20 minutes until slightly softened. Serve cold. Put on a plate (with toothpicks) and sprinkle with tarragon and a little lemon juice. You can easily add more salt and pepper to taste. If you want a dip on the side, mix together yogurt, honey and curry.

                                   

Fruit and Cheese Pairings

Create one plate with sliced Bartlett pears and aged Gouda cheese and another plate with Honey Crisp apples and blue cheese.

 

Granola

It’s so simple and so good. Mix together a bowl of dried cherries, hazelnuts, unsweetened shaved coconut and dark chocolate chips

           

Now, when Thanksgiving is over, and I’m at leisure again, I’ll be cooking a venison roast like this. Of course, if you don’t have venison, use beef:                                     

 

Venison Roast

Rub meat with lots of salt and pepper, ground thyme and oregano, garlic powder and smoked paprika. Sear each side on high heat in very hot oil. Remove from pan. Pour in to pan (do not clean it) -3/4 cup of stout beer, 1/8 cup maple syrup, and 2 Tbsp of black currant balsamic and cook until slightly reduced. Pour over roast. Top with sliced garlic and onions. Sprinkle with ground juniper berries and black pepper. Cook at 350 degrees for 15 min, then lower the temperature to 200 degrees and cook for approximately one hour depending on size of the roast. Baste it a couple times. If the liquids are looking low, add more beer (or water). Add sliced mushrooms for the last 10 minutes. Let it sit with lid on for at least 15 minutes before slicing.

 

Hope you all have a wonderful Thanksgiving! Make it special!

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Rosi & Gardner, P.C.
735  S. Garfield Avenue
Suite 202
Traverse City, Michigan 49686
231-941-5878
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Philip R. Rosi

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Gary Allen Gardner
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