In the fast-paced world of entrepreneurship, decisions about where to establish your business can significantly impact its success. Lately, there's been a surge of interest in incorporating businesses in Nevada, and it's not just due to the state's stunning landscapes and vibrant cities. The “Elon Musk Effect” has been a driving force behind this trend, as more entrepreneurs are drawn to the benefits that Nevada offers for business incorporation.

Elon Musk, the visionary CEO behind companies like Tesla and SpaceX, has long been associated with innovation and success. His decision to establish a significant presence in Nevada has not gone unnoticed. In a recent article by the Las Vegas Review Journal, aptly titled "The Elon Musk Effect: Why more businesses want to incorporate in Nevada," it was noted that  “There were more than 108,000 business entities registered in Nevada in 2023, a roughly 150 percent increase from 2019, according to data from the Secretary of State’s Office.”

Musk's endorsement of Nevada as a favorable destination for business incorporation underscores several key benefits that the state offers:

Tax Advantages

One of the most compelling reasons for incorporating in Nevada is its favorable tax environment. With no state income tax, no franchise tax, and no corporate income tax, businesses can retain more of their profits, allowing for greater investments and growth opportunities.

Legal Protections

Nevada boasts robust legal protections for business owners, including strong asset protection laws and privacy provisions. These protections offer entrepreneurs peace of mind, knowing that their assets are safeguarded in the event of legal disputes or financial challenges.

Business-Friendly Regulations

Navigating regulatory requirements can be a daunting task for business owners. Fortunately, Nevada has a reputation for its business-friendly regulatory environment, making it easier for companies to operate and thrive. From streamlined incorporation processes to supportive government initiatives, Nevada fosters an environment conducive to business success.

Access to Resources

In addition to its favorable business climate, Nevada offers access to a skilled workforce, as well as various resources and incentives for businesses. From business incubators to economic development programs, entrepreneurs have access to the support they need to grow and prosper.

While the benefits of incorporating in Nevada are clear, navigating the incorporation process can be complex. That's where Jeffrey Burr can help. With experience in business law and a deep understanding of Nevada's regulatory landscape, The Law Firm of Jeffrey Burr is uniquely positioned to assist entrepreneurs and business owners in incorporating their businesses and maximizing their benefits.

Finding love again after the loss of a spouse or a divorce can bring immense joy, but it also brings new considerations, especially when it comes to estate planning for blended families in Nevada. Here are five key strategies to avoid common pitfalls and ensure a smooth transition of assets for your loved ones:

Error #1: Not Updating Beneficiaries

When entering a second marriage, it's crucial to review and update beneficiary designations on financial accounts, including retirement plans and life insurance policies. In Nevada, failing to designate your current spouse or child as the primary beneficiary can lead to unintended consequences, such as assets going to a previous spouse. Regularly review and update beneficiary designations to align with your current wishes.

Error #2: Neglecting Your Will and Trust

While beneficiary designations cover certain assets, your Trust or Will plays a critical role in distributing the rest of your estate. Ensure your estate plan reflects your wishes for asset distribution, especially if you want to provide for both your current spouse and children from a previous marriage. Considerations such as who inherits the family home and sentimental items should be clearly outlined in your estate planning documents.

Error #3: Equal Treatment for Unequal Situations

Not all heirs are in the same financial position, particularly in blended families. Considerations such as unequal contributions to the marriage or special needs of certain heirs should guide your estate planning decisions. Discuss these matters openly with your spouse and legal advisor to create a fair and tailored plan that meets everyone's needs.

Error #4: Delaying Gifts to Children

Consider gifting assets to children during your lifetime rather than solely relying on your estate plan. In Nevada, you can gift up to $15,000 per person annually without triggering gift taxes, offering a tax-efficient way to transfer wealth and provide financial support to your children. Consult with a tax attorney at Jeffrey Burr to explore gifting strategies that align with your estate plan.

Error #5: DIY Estate Planning

While online resources may seem convenient, complex family dynamics and legal considerations in Nevada warrant professional estate planning guidance. An experienced estate planning attorney can help navigate nuances such as probate laws, tax pitfalls, trust structures, and ensuring your wishes are legally enforceable.

Navigating estate planning for second marriages in Nevada requires careful consideration of family dynamics, legal requirements, and tax implications. By addressing these key mistakes and working with knowledgeable tax attorneys at Jeffrey Burr, you can create a comprehensive estate plan that protects your loved ones and preserves your legacy effectively.

Settling an estate can be a complex and emotionally charged process. In Nevada, flat fee probate has emerged as a popular alternative to traditional hourly billing. This approach offers a number of benefits, including cost predictability, transparent pricing, and a streamlined process. Depending on the situation, flat fee probate in Nevada can be a wise decision.

1. Cost Predictability: One of the most significant advantages of opting for flat fee probate in Nevada is cost predictability. Flat fee probate eliminates the uncertainty of traditional hourly billing. With a clear understanding of the upfront cost, beneficiaries can focus on grieving and estate settlement without worrying about unexpected legal fees.
2. Transparent Pricing: Flat fee probate typically comes with a clear breakdown of fees, which allows you to understand what you're paying for. This transparency eliminates the risk of surprise charges or hidden fees, ensuring you're fully informed about the costs involved.
3. Streamlined Process: Flat fee probate incentivizes attorneys to complete the process efficiently. This can lead to a quicker resolution and distribution of assets.
4. Reduced Stress: Navigating the probate process can be stressful and emotionally draining. Flat fee probate can help to reduce this stress by eliminating the uncertainty of legal fees. Beneficiaries can focus on their loved one's legacy without worrying about escalating costs.
5. Encourages Open Communication: With a flat fee agreement in place, clients are more likely to communicate openly and honestly with their attorney. This can lead to better collaboration and a stronger relationship between the attorney and the client. 
6. Ideal for Smaller Estates: Flat fee probate can be a particularly attractive option for smaller estates, where hourly billing may not be cost-effective. This approach allows families with limited assets to access professional legal assistance without worrying about excessive costs.
7. Encourages Accountability: Flat fee probate structures incentivize attorneys to provide efficient and the highest quality of service. Attorneys know that their compensation is not tied to the number of hours worked, so they have a vested interest in completing the process quickly and effectively.

Flat fee probate can be a financially prudent and stress-reducing option for estate settlement in Nevada. It offers a number of benefits that can make the probate process more manageable during a difficult time. Clients who are considering flat fee probate should consult with an experienced Nevada probate attorney to learn more about how this approach can benefit their specific situation. At The Law Firm of Jeffrey Burr, our firm’s experienced probate attorneys have been guiding families through the difficult probate process for 40 years. Our experience and knowledge of Nevada probate law allow us to effectively guide you through probate administration without unnecessary delay or expense. Contact us today regarding your probate matters and we can discuss if flat fee probate is right for you.

Many people are familiar with the concept of the reading of the Will. This is the time when all of the family members gather together with the attorney present. The terms of the Will are then read aloud for everyone to hear all at once. Generally, the terms of the Will reveal the identity of the persons who are nominated to serve as the executor and the names of the beneficiaries who have been designated to receive the deceased family member’s property. As a practical matter, however, the reading of the Will simply does not occur as it once may have in the past. So how and when are the beneficiaries notified of their inheritance?

An executor will be named in the Will. The testator [the person that writes the Will] is encouraged to let the executor know that he or she has been named to carry out the terms of the Will upon the testator’s death. Accordingly, the executor will often already have a copy of the Will or will contact the attorney that drafted the Will in order to obtain a copy. Under Nevada law, the person in possession of the original Will must either turn the Will over to the executor, or lodge it with the Court within 30 days of the testator’s death. Once the will is filed with the Court, it becomes public record and can be seen by anyone. However, the law does not require that the lodged Will be sent out to the named beneficiaries under the Will.

Once the executor meets with the attorney, the determination will be made as to whether or not the Will needs to be admitted to probate. This will depend on what assets were owned by the testator, how such assets were titled and the value of the assets. Once it is determined that some sort of probate proceeding will be necessary, all interested persons must receive notice of the initial petition once it is filed with the Court. Interested persons consist of the named beneficiaries under the Will, as well as the intestate heirs. The intestate heirs are those persons who would take the testator’s property under law if the testator had not executed a Will. Oftentimes the beneficiaries and the intestate heirs may be one and the same.

The interested persons will receive a copy of the petition with the lodged Will attached as an exhibit. Any interested persons would then have the opportunity to contest the Will if there were reasons for doing so. In absence of such a Will contest, the Court will hold a hearing on the petition and the Will will thereafter be admitted to probate. There may be an administrative period where creditors are notified, the testator’s debts are settled, and taxes are prepared and paid. After the administrative period is concluded, the executor may start the process of winding down the probate administration and requesting distribution to the beneficiaries.

2021 was an interesting year for estate planning professionals and high-net-worth individuals and families. After a year of speculation and legislative uncertainty, congress was unable to pass the Build Back Better Act.

On September 15, 2021, the House Ways and Means Committee released legislative text detailing their proposed tax increases as part of President Biden's Build Back Better Framework.
On September 27, 2021, the legislative text proposed by the House Ways and Means Committee was advanced in a bill sponsored by Rep. John Yarmuth, D-KY, and introduced to the House Rules Committee as the Build Back Better Act (H.R. 5376).

The original bill included tax increases for high-income individuals and families, and sought to eliminate many of the key estate planning techniques utilized to reduce wealth transfer taxes.

Some of the more relevant proposals in original bill, included: (1) reduction of the basic exclusion amount for federal gift, estate, and generation-skipping transfer tax purposes from $11,700,000 to $5,000,000, indexed for inflation; (2) different tax treatment for grantor trusts that would have limited them as an estate planning vehicle; and (3) disallowance of the use of entity-level valuation discounts for nonbusiness assets held in family-owned entities.

Fortunately, the original bill was modified to eliminate the various sections relating to the items described above. The most recent legislative text of the Build Back Better Act (H.R. 5376) is found in the Rules Committee Print 117-18 released by the House Rules Committee on November 3, 2021, and subsequently amended by Rules Committee Print 117-19 on November 4, 2021.

Although the items mentioned above have been eliminated and are not included in the most recent legislative text found in Rules Committee Print 117-18, the updated text still includes language that would impose surcharges on high-income individuals, estates, and trusts.

Under the updated text of Rules Committee Print 117-18, a five (5%) percent surcharge would be imposed on the "modified adjusted gross income" of a taxpayer that exceeds $5 million (married filing separately), $200,000 (estate or non-grantor trust), and $10 million in all other cases. Additionally, a three (3%) percent surcharge would be imposed on the “modified adjusted gross income" of a taxpayer that exceeds $12.5 million (married filing separately), $500,000 (estate or non-grantor trust), and $25 million in all other cases.

The future of the Build Back Better Act remains uncertain, and it is difficult to predict whether the bill will be revisited by Senator Joe Manchin and his Senate colleagues. It is very possible that some version of the Build Back Better Act could be adopted by the House of Representatives and the Senate without any significant changes to wealth transfer tax laws. Despite all the uncertainty, the September proposal and original bill should provide individuals and families with an increased awareness of the congressional Democrats' playbook to target high-income individuals and families.

For calendar year 2022, the basic exclusion amount for federal gift, estate, and generation-skipping transfer tax purposes is $12,060,00 per person ($24,120,000 collectively for couples). The basic exclusion amount will be adjusted upward for inflation in future years, but under current law it is scheduled to "sunset" and be reduced by fifty percent (50%) on January 1, 2026. The Treasury Department has confirmed that taxpayers taking advantage of the increased basic exclusion amount in effect from 2018 to 2025 will not be adversely impacted after 2025 when the basic exclusion amount is scheduled to drop to pre-2018 levels. In other words, if the taxpayer uses the "extra" basic exclusion amount before it expires (by making lifetime gifts), it will not be "clawed back” to cause additional tax if the taxpayer dies after the basic exclusion amount is reduced in 2026. Therefore, it is a "use it or lose it" type of benefit, and the taxpayer who makes use of the additional basic exclusion amount prior to 2026 will lock in the benefit of the extra basic exclusion amount.

As a result of the current legislative uncertainty and future “sunsetting" of the increased basic exclusion amount, high-networth individuals and families should consider utilizing currently available estate planning techniques, such as making gifts or sales to grantor trusts, to maximize their applicable federal gift, estate, and generation-skipping transfer tax exemptions.

We continue to meet with clients who still utilize what's called a Two Trust or an AB trust. Back in its day, having an AB Trust allowed married couples to essentially double the amount that could be passed to the next generation by preserving the 1st spouse's exemption at their death and allowing an additional exemption at the 2nd spouse's passing. Unfortunately, the technique was only available through the use of a complicated "AB trust" which generally had to be prepared by an attorney to be effective.

That all changed when Congress passed legislation called "portability," allowing a surviving spouse the right to use a deceased spouse's unused exemption even if it wasn't placed in an exempt trust. In addition, the lifetime exemption amount has increased dramatically in recent years and continues to increase with inflation every year, which allows for simpler and more cost-effective estate planning. Because of portability and the increase in the exemption amounts, many AB trusts are no longer necessary.

With an AB Trust, the splitting of the first trust requires a trust administration at the first spouse's death, which may be costly and time consuming as an inventory of trust assets must be done, property must be appraised and valued, and allocations between sub-trusts need to be made. Now, because of portability and the current high exemption amount, the requirement that a surviving spouse make that allocation is sometimes unnecessary and economically impractical, and the surviving spouse can avoid a complex trust administration and simply continue to manage and control the trust property.

On the other hand, although splitting the trust in the first death may no longer be needed for tax purposes, it may still be advisable in the case of a second marriage or when spouses have different remainder beneficiaries.

We recommend that if your trust has a mandatory split provision that you have your plan reviewed. Changes in your family circumstances such as the birth, death, marriage or divorce of a child can also have an impact on your estate planning. Trustees selected may no longer be available or be a preferred choice.

External changes such as changes in the tax laws, changes in state law, and possible additions or deletions of your assets are all reasons to revisit your trust to make sure that your planning is comprehensive. For all of the above reasons, your estate plan should be reviewed every 2-3 years.

In addition, a review may be necessary to ensure that any additional assets you may have acquired have been accurately transferred into the Trust and that your Trust is properly funded. An important element of your plan is the completion of your Asset Inventory; this inventory should accurately reflect all of your current Trust assets.

If you haven't reviewed your estate plan in recent years, it may be time for a review. Call our office to schedule a consultation with one of our estate planning attorneys.

We often get asked whether having a Will is sufficient to avoid probate in Nevada. The question is usually asked by children of a deceased parent who are facing the time-consuming and expensive probate process because proper estate planning did not take place during the parent’s lifetime. The answer, in short, is that in Nevada having a Will is not enough to keep a person out of probate court at their death.

A Will is a legal instrument that determines how assets are to be divided at a person’s death. Wills are an effective way to accomplish this goal. However, if a person only uses a Will, a probate will be required for the distribution of those assets that do not automatically transfer to another person, such as with real property. With only a Will, children and other beneficiaries can be stuck with a time-consuming, expensive, and public probate.

In Nevada, if the deceased person’s assets exceed $25,000, or if there is real property involved, probate is normally required. If the value of the estate does not exceed $100,000, a petition can be filed in court, requesting that the estate be “set aside.” This means that the estate's distributions can be made without the court intervening. If the property values between $100,000 and $300,000, the estate can go through probate by way of a “Summary Administration.” If the value of the property exceeds $300,000, it must go through full probate, or “General Administration.”

There are several effective estate planning techniques that can be implemented to completely avoid probate. For example, a person can create a revocable trust. This estate planning tool allows a person to not only avoid probate and designate beneficiaries of their choice, but it also helps protect a person in the case of incapacity prior to their death. One can also try to avoid probate by making arrangements for the automatic transfer of assets, such as by naming designated beneficiaries on bank and other investment accounts.

Each method of avoiding probate has advantages and disadvantages. It is important to speak with an estate planning attorney before making any decisions to make certain your planning is done correctly, and your goals are successfully met.

We all would like to pass a little on to our children, loved ones, or perhaps to an organization that is important to us. You worked hard to build your legacy. The last thing anyone wants is to give a large percentage of their estate to pay probate fees.

Recently, Bernie Sanders presented his proposed tax reform legislation, which outlines drastic changes to the estate and gift tax exemption. While it is our hope that this proposed law will not be enacted, it seems best to “plan for the worst and hope for the best,” given the unpredictable political climate, and the possible changes that may be made if a watered-down version of this potent proposed law passes. The good news is that the proposed reduction of the estate tax exemption amount from $11,700,000 to $3,500,000 would not occur until January 1, 2022.

The same timing applies for the proposed reduction of the gift tax allowance to only $1,000,000, which means that people will not be able to gift more than $1,000,000 after 2021 without paying gift tax.

Also, the proposed increase in the estate tax rate to 45% once a deceased person’s taxable estate exceeds $3,500,000, and 50% and higher when the amount subject to tax exceeds $10,000,000, will not apply until 2022.

In addition to the above exemption and tax changes, gifting of up to $15,000 per year per person will be limited to $30,000 per donor per year for gifts to irrevocable trusts or of interests in certain “flow-through entities” beginning in 2022.

The tougher news for many clients is that some of the primary tools and strategies that we have used in the past will not be available in the future, beginning upon the date that President Biden signs the bill into law if this occurs. Once that happens, we will not be able to fund or have assets sold to Irrevocable Trusts that can be disregarded for income tax purposes, and we will also not be able to use valuation discounts or Grantor Retained Annuity Trusts (GRATs) in most circumstances, although those arrangements put into place before the new law is passed will be grandfathered as long as they are not added to or altered after the law is passed, as presently written.

This is an important CALL TO ACTION for families having assets expected to exceed $3,500,000 per person to take a serious look at their present planning situation in order to determine whether to take immediate steps to avoid death taxes. In particular, clients who have irrevocable trusts may want to act without delay to extend any notes that may be owned by them to the longest period practical, and to sell assets that may go up in value, and exchanges for assets that may be more suitable to be owned by these trusts, given that exchanges and changes made after a new law is passed may not be possible.

We have been inundated with estate tax planning since the beginning of last year and are generally operating at capacity. If you wish to complete an estate tax plan that you have started with us or to further develop or act upon an estate tax planning structure you already have in place, please let us know immediately, and confirm that you can provide us with updated asset and entity information so that we can avoid any delays in putting whatever you would like to do into action before new law may pass. We will give first priority to clients who contact us without delay and have plans in place or in progress.

If your estate value is $3.5M or over, act now and don't wait!

² Fact Sheet: Residency Requirements in Nevada (2016).
https://www.leg.state.nv.us/Division/Research/Publications/Factsheets/Residency.pdf.

Choosing colors, cakes, decorations, and invitations can seem daunting, but once the big day is over, there are other important considerations. Whether or not it’s your first walk down the aisle, it’s important to nail down particular aspects of your estate planning during this pivotal time. 

Estate planning isn’t just for those with more experience under their belt. Estate planning is for everyone—especially those who are married. This article is geared towards first-time marriages and will overview estate planning documents newlyweds should have. Creating an estate plan can be a bit costly up-front but will save time and money later. It’s beneficial to begin your life together on the right foot. Compared to planning a wedding, your estate planning is a piece of cake. As promised, here are 10 estate planning tips for newlyweds.

1. Talk with your significant other about the importance of estate planning.
   Talking about planning for the worst parts of life can feel scary and overwhelming. However, it’s one of the most important things you can do to have peace of mind for yourself, spouse, and family members. Share the importance of estate planning and why it’s necessary for the two of you to create or update your documents.
   
   
2. Compile important documents.
   These documents include your marriage certificate, birth certificates, social security cards, passports, armed forces IDs, citizenship documentation, prenuptial and postnuptial documents, and any documents relating to children you may have. Also, track down existing estate planning documents you may have. These documents include but aren’t limited to trusts, trust amendments, last will and testaments, powers of attorney, and assignments of assets. Compile financial information, including the names and approximate balances of banking, retirement, life insurance, and other accounts.
   
   
3. Gather information about your assets.
   Compile deeds of homes and rental properties, titles of vehicles, collectibles, and other valuable items of personal property. If you don’t have all this information readily accessible, your estate planning attorney may be able to help track down information about your home or investment properties. Your attorney should have a questionnaire to assist in gathering and organizing this information. Don’t forget to reach out and ask for this questionnaire. Whether you have a lot of assets or you’re just starting your career, estate planning is essential.
   
   
4. Talk with your significant other about your estate planning goals.
   Your goals may include leaving a specific asset to a person or group of people or charity, providing for a special needs child, protecting assets from potential litigation, appointing guardians for your children, and appointing guardians for yourself. A skilled estate planning attorney will have solutions for any potential planning concerns. Your attorney should also talk with you about the benefits of avoiding probate, protecting your privacy, avoiding guardianship or conservatorship, heading off a will contest, facilitating post-death sale or development of the real estate, and flexible terms of your documents.
   
   
5. Review insurance coverage.
   Newly married couples should review their insurance coverage and needs soon after the honeymoon. Coverage needs change when combining or creating families. Often both spouses are needed to continue paying for household expenses. Be sure to meet with your trusted insurance agent to review your current coverage. This will prevent a surviving spouse’s already difficult situation from becoming worse under unfortunate circumstances. Your estate planning attorney can help identify opportunities to add or change insurance policies in tax-conscious ways.
   
   
6. Find a skilled estate planning attorney.
   Estate planning is a complex area of law. It’s important to choose an attorney with experience and knowledge to draft the best estate planning documents possible. You can use websites like Avvo, Martindale, and Google to find an experienced attorney near you. It’s also helpful to ask friends and family who they recommend or uses for their estate planning.
   
   
7. Create wills and trust.
   A well-drafted will or trust is usually the starting point in implementing a sound estate plan. An attorney can pinpoint potential problems in your existing documents and make recommendations to correct these problems. A properly drafted will or trust will assist in minimizing estate taxes and maximizing the value of your estate that passes to your heirs. You decide who your beneficiaries will be in these documents, determine the guardian to your minor children, and facilitate a smooth transition upon the incapacity or passing of either you or your spouse. If properly created and funded, these documents will transfer your estate to your beneficiaries without the cost and delay of probate.
   
   
8. Create financial powers of attorney.
   Financial powers of attorney are important documents in the event you or your spouse become so ill you cannot make financial decisions. The person you nominate will have the power to pay your bills, access your bank accounts, and pay for your expenses if you are unable.
   
   
9. Create healthcare powers of attorney.
   As a United States citizen, you have the right to control the medical treatment you receive. However, if you are unconscious or mentally incapacitated, your ability to exercise that right is severely affected. Many states, including Nevada, have enacted Healthcare Powers of Attorney statutes. These documents ensure your specific desires regarding your medical treatment are honored if you are unable to communicate your wishes. They not only provide you peace of mind but will protect your loved ones from making these difficult and deeply personal choices for you. Your healthcare power of attorney will include your desires regarding artificial life support and the removal of life support. For this form to be honored, it must be considered effective under your state’s laws. This means it must be drafted and executed in a specific way with a specific language. A validly drafted and executed healthcare power of attorney offers peace of mind by guaranteeing your medical treatment wishes are honored.
   
   
10. Fund your trust.
    Once your will, trust, and other documents are properly drafted and executed, it’s essential to fund your trust. Funding your trust includes transferring most of your assets to your trust by changing the “owner” of your bank account, home, and other assets from yourself to your trust. For tax purposes, some accounts should not be titled in the name of your trust. Your estate planning attorney should have substantial tax experience and will guide you through this process.

While the above tips for your newlywed estate planning may seem a little daunting, the process can be made quite simple with guidance from your estate planning, insurance, and investment professionals. Contact them shortly after you return from your honeymoon to begin this process.

At Jeffrey Burr, LTD., our focus is providing excellent estate planning and tax guidance. We provide services to local Nevadans, as well as U.S. and non-U.S. residents outside Nevada. We offer a complimentary 30-minute consultation for potential estate planning clients. Contact us today to set up a consultation with one of our experienced attorneys.