Emancipation 101

On behalf of The Law Office of Wickersham and Bowers posted in Family Law on Tuesday October 18th, 2022.

Emancipation can generally be defined as an act in which a person usually a slave or a minor is set free from the authority of another person. It can be regarded as the liberation of the bounded individual from the duty to serve and obey their owners or parents.

Emancipation minors who are eligible to be given the same rights as adults. Most states have statutes specifically designed to govern emancipation. As much as the statutes may vary from state to state, most states allow for emancipation under the court’s review. This implies that all states have laws that define when, how, and the circumstances in which a child can be emancipated from their parents.

At What Age Can One Be Emancipated 

There is no fixed age for emancipation. However, some states such as California require that you must be at least 14, to apply for emancipation while in other states such as Mississippi there is no minimum age requirement. However, a minor is normally assumed to have been emancipated when to the age of either 18 or 21, this is dependent on the state.

What Happens If the State Does Not Have Specific Laws That Govern Emancipation? 

The court may act as an arbitrator of emancipation claims if the state does not have particular laws that govern emancipation. One will need a petition to be emancipated under the judicial decree. The petition can be done by either the person seeking emancipation, the guardian of a minor, or an acquaintance. The petition is filed at a county court. It must be accompanied by evidence of the conduct of both the minor or guardian that violates the rights and responsibilities of the guardian to the child and the child to the guardian.

Implicit Vs Explicit Emancipation 

Emancipation can either be thought of as implicit or explicit. Implicit emancipation occurs when one marries, is convicted of a felony, joins the armed forces, reaches the age of majority which is majorly 18 or 21 in most states, or permanently moves away from the parents. Implicit emancipation does not require a court order to be valid. Explicit emancipation cannot occur without a court order from a judge. It involves the liberating entity’s declaration before witnesses and a public officer that they intend to set the bound individual free.

What is Spousal Lifetime Assess Trust

On behalf of The Law Office of Wickersham and Bowers posted in Estate Planning on Tuesday October 18, 2022.

The Spousal Lifetime Assess Trust (SLAT) is a common strategy for tax savings that is used by married couples. The spousal lifetime access trust is an irreversible trust that is created by one spouse to benefit another spouse. The donor spouse makes a gift to the SLAT by using their gift tax exemption and then the spouse who will benefit is named as the beneficiary.

The SLAT offers married couples a way to take advantage of the federal lifetime gift and estate tax exclusion whilst keeping restricted access. It is possible for either one spouse to fund the SLAT for another spouse or each spouse may opt to fund the SLAT.

SLAT 101

It is vital to remember that the trust is irrevocable and this means that when contributing spouse transfers assets to the SLAT, they are forever parting with the use of those assets and any income from it.

However, the contributing spouse can only gain benefits from the funds and property given to the trust if the benefactor of the trust is still legally wedded to the donor. This is subject to the terms of the SLAT, the spouse who is to benefit from the SLAT could receive distributions of income from the SLAT, which allows the benefactor spouse together with the donor spouse indirectly, to access the assets if they needed to.

Advantages and disadvantages of SLAT

An advantage of SLAT is that it enables the contributing spouse to donate up to their available exemption amount without gift tax. If the contributing spouse dies, the value of the assets in SLAT will not be subjected to federal estate tax since it is excluded from the contributing spouse’s gross estate because the SLAT is funded with a gift made during the contributing spouse’s lifetime.

The downside to a SLAT is that if the benefactor of the trust dies, then that would mean that the donor of the trust will no longer have indirect access to the SLAT. The donor of the trust will have no choice but to terminate the trust. They can either choose to distribute it or continue it for the donor’s children or perhaps other family members.