Entries by Christian S. Kelso

Upjohn Clause: A Trap for the Unwary Trustee

Many trust instruments prohibit trustees from relieving themselves of a legal duty under applicable law.  Such language, which is sometimes referred to as an “Upjohn” clause after the case of Upjohn v. U.S.  (30 A.F.T.R. 2d. 72-5918 (W.D. Mich 1972)), is most often, intended to prohibit a trustee from using trust assets to pay for […]

Luxury Property Special Purpose Entities

Portions of this article were originally printed in Dallas Bar Association Headnotes, December 2017. When it comes to luxury property, such as beach houses, lake houses, ski condos, hunting leases, aircraft, watercraft, limousines, and the like, two rules almost always apply:  First, they are expensive to own and operate.  Second, they tend to sit dormant […]

Capacity to sign

Different legal actions require different levels of mental capacity to be valid.  For example, the level of mental capacity required to sign a will, referred to as “testamentary capacity,” is lower than the level of capacity required to sign a contract, called “contractual capacity.” The various standards are discussed below. Capacity to Sign a Will […]

It’s time to make your 663(b) trust and estate distributions!

Trusts and estates often pay more tax than individuals in like circumstances.  This is not because they are taxed at higher rates, but rather because the same rates applicable to individuals are “compressed,” meaning that each marginal rate increase happens at a lower level of income than it does for individuals.  For example, the highest […]