Is there help when adviser swindles elderly mom?
Q. My 74-year-old widowed mother worked for minimum wage all her life. In 2009, she invested her life savings of $120,000 at a major brokerage firm. After a 40-minute sales presentation, the investment representative sold my mother a complex variable annuity with annual expenses of 4.65 percent. How might I complain or protest this investment, which I think was unsuitable (but lucrative for the investment rep)?
A. You may have waited too long to do anything about your mother’s annuity. But to know for sure, you can call the Texas Department of Insurance help line at 800252-3439 or file a complaint online at tdi.texas.gov.
You could also search the web for “Texas annuity fraud lawyer” and that will lead you to many lawyers who represent people like your mother in actions against their advisers and the companies they represent.
Q. My mother passed away in May of this year, and my aunt is handling her revocable trust. Everything has been resolved, except that my aunt will have to file an income tax return for 2021, with the possibility that there might be taxes owed or refunded. Should my aunt wait to terminate the trust until 2022 to see what happens with the IRS to make this a clean transaction?
A. If the revocable trust is holding more assets than she thinks will be owed to the IRS, and if she feels certain that the members of your family who will be receiving the trust distributions would return the money to her if needed, then she can safely distribute all of the revocable trust assets to the beneficiaries while holding back only what she thinks would be needed to pay the taxes and the accountant.
To prevent the trust from having income in 2022, she should be sure the account for the revocable trust is non-interest
bearing. Q. My husband and I own a second home free and clear in San Antonio, and we want to give it to our daughter and her husband. How can we do this? Will we owe any gift taxes?
A. To give the home to them, you would need to sign and record a gift deed. A lawyer can prepare this deed for you.
Of course, you should think about whether it would be better to give the home only to your daughter, as her separate property. That way, she would be able to keep it if they ever got divorced.
The two of you can give your daughter up to $30,000 this year without any gift tax consequences. (You can also give her husband $30,000.)
If the home is worth more than $30,000 (or $60,000), then you and your husband will be required to file gift tax returns to report the gift to the IRS, but as long as the value of the home plus any other large taxable gifts the two of you have made during your lifetimes is less than $23,400,000, you won’t owe any gift taxes.
You should talk to an attorney and your accountant before giving away the home.
The information in this column is intended to provide a general understanding of the law, not legal advice. Readers with legal problems, including those whose questions are addressed here, should consult attorneys for advice on their particular circumstances. Ronald Lipman of the Houston law firm Lipman & Associates is board-certified in estate planning and probate law by the Texas Board of Legal Specialization. Email questions to stateyourcase@ lipmanpc.com.