Tel: 847-234-6262

Fax: 847-234-7629

Email: robert@kolasalaw.com

Law Offices of Robert J. Kolasa, Ltd

1401 N. Western Avenue, 2nd Floor
Lake Forest, IL 60045

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© 2017 by Robert J. Kolasa, Ltd.

All Rights Reserved.

Law Offices of Robert J. Kolasa, Ltd

1401 N. Western Avenue, 2nd Floor
Lake Forest, IL 60045

 

Law Offices of Robert J. Kolasa, Ltd

1401 N. Western Avenue, 2nd Floor
Lake Forest, IL 60045

 

News & Publications
New 2017 Tax Bill Signed into Law by President Trump on December 22, 2017

by Robert J. Kolasa

 

See my recent seminar outline “An Overview of the Tax Cuts and Jobs Act,” where I lectured on the new tax law in New Orleans at a professional conference attended by attorneys from the Trust and Estates and Real Estate Committees of the Lake County Bar Association.  Read the outline and see how substantial changes have been made to our individual, business and estate tax rules.

Click An Overview of the Tax Cuts and Jobs Act

Contact Us Now
Problems in Springing the Delaware Tax Trap

by Robert J. Kolasa

 

I'm really proud of this article, as it was published in the April 2018 edition of Trusts and Estates magazine, a prestigious legal publication.  With the increased estate tax exclusions, many existing credit shelter trusts will no longer generate estate tax savings.  Worse yet, such trusts may also trigger higher income taxes upon the sale of appreciated assets.  A popular way to achieve basis step-up for credit shelter trusts involves springing the so called Delaware Tax Trap ("Trap").  But, can the Trap be sprung in jurisdictions where local law permits trusts to last in perpetuity or for a very long stated period? Depending on one’s interpretation of the law, trusts in perpetual (or near-perpetual) jurisdictions may be precluded from using this strategy.

 

Click Problems in Springing the Delaware Tax Trap

Stepped-up Basis for Credit Shelter Trusts using
PEG Powers under Illinois Law

by Robert J. Kolasa

 

Credit Shelter Trusts (CSTs) have been established for many taxpayers who will not be subject to estate taxes because total assets are less than current estate tax exclusions.  In such cases, CSTs may result in higher overall taxes because CST assets do not receive "stepped up" basis upon the death of the surviving spouse.  This article examines a credible solution to this common and dangerous tax trap.

 

Click Stepped-up Basis for Credit Shelter Trusts

Avoiding Malpractice under the New Estate Tax Portability Rules

by Robert J. Kolasa

 

Estate tax portability was created under the federal rules as a relief provision for married taxpayers not having the planning prowess to establish a credit shelter trust at the death of the first to die. This article examines the estate tax portability rules and the sensitive filing deadlines which are needed to invoke its benefit.

 

Click Estate Tax Portability

Making Constitutional Challenges to the Illinois Tax on Trust Income

by Robert J. Kolasa

 

Given the high stakes, trustees should consider bringing constitutional challenges to state law to avoid the 6.5 percent Illinois tax on undistributed income under the right circumstances.  This article looks at Illinois statutory law governing trust taxation, reviews cases from various jurisdictions that have upheld and rejected constitutional challenges, and offers advice to Illinois lawyers who might want to consider bringing suits of their own

 

Click Constitutional Challenges to IL Trust Income  Tax 

Making Gifts can Reduce Illinois Estate Taxes

by Robert J. Kolasa

 

Recent legislation makes the Illinois estate tax permanent and increases the Illinois estate tax exclusion amount to $3.5 million in 2012 and $4 million for future years. The new exclusions will encourage gifting for clients having tentative taxable estates more than marginally over such limits, because gifts are not taken into account in the Illinois estate tax calculation and thus reduce Illinois estate taxes. For non-cash gifts, the benefit of gifting is lessened by the loss of stepped-up basis at death, but that may in turn be mitigated by estate tax savings resulting from the property’s appreciation during the post-gift period.

Click Making Gifts

George Steinbrenner's Estate Tax Home Run

by Robert J. Kolasa

 

This is a somewhat humorous article I wrote detailing how the estate of George Steinbrenner, the irascible owner of the New York Yankees who died in 2010, avoided hundreds of millions of estate taxes because of that "strange" one-year estate tax repeal period in 2010.

Click George Steinbrenner's Estate Tax Home Run

How to Control Your Wealth after Death (if you want to)
A Seminar Presentation on  Trusts and Estate Planning

by Robert J. Kolasa

 

Attached is the Powerpoint presentation I presented for a basic estate planning seminar in Gurnee, IL on February 25, 2015.  Covered issues are custom drafted trusts,  educational trusts, basic estate planning documents, common estate planning mistakes, asset protection techniques, Dynasty Trusts, probate, IRA distributions, estate taxes and estate tax portability.

Click How to Control Your Wealth powerpoint presentation

Drafting Trusts for Asset Protection

by Robert J. Kolasa

 

This 2005 article is still relevant to the structuring of trusts with asset protection attributes.  Major modules discussed are asset protection implications for "routine" trusts, asset protection drafting recommendations, self-settled trusts and different trust distribution standards.

 

Click Drafting Trusts for Asset Protection

The Illinois QTIP Election to to the Rescue

by Robert J. Kolasa

 

After much anticipation, Illinois estate planners finally got what they wished for when the Illinois QTIP legislation became law on September 8, 2009. For married couples it is now possible to make an election on the first to die’s Illinois estate tax return to help solve the conundrums practitioners faced in dealing with the differing federal and Illinois estate tax exclusion amounts.

Click The Illinois QITP Election to to The Rescue

Advise Your Clients on How They Can Increase Their Incomes, Avoid Capital Gains Taxes, Reduce Estate Taxes and Become a Saint

by Robert J. Kolasa

 

Charitable Remainder Trusts ("CRTs") can reap tremendous tax and financial benefits. Once relegated to the very wealthy, CRTs are becoming increasingly popular for middle class clients holding appreciated assets. In general, a CRT is a tax-exempt trust a donor establishes which designates the donor or family members as income beneficiaries, with a charity as remainder beneficiary. This article explains the basic mechanics and benefits of CRTs.

Click Advise Your Clients on How They Can Increase...

Asset Protection Changes by the New Bankruptcy Act

by Robert J. Kolasa

 

The Bankruptcy Abuse and Consumer Protection Act of 2005.
This article is the 2nd of two articles examining the revolutionary 2005 bankruptcy law which was signed into law by President George W. Bush. The 1st article (available Here) discussed how the new law would force many individual consumer debtors from Chapter 7 to Chapter 13 proceedings, requiring five years of payments to unsecured creditors. This 2nd article discusses how the Act significantly changes the rules relating to bankruptcy forum shopping, exemption planning and asset protection trusts.

Click Asset Protection Changes by the New Bankruptcy Act

Asset Protection        Class Powerpoint Presentation

by Robert J. Kolasa

 

Attached is the Powerpoint presentation I presented as part of an asset protection class for the College of Lake County. Covered issues included defining asset protection, goals, and common mistakes, fraudulent transfers, exemption planning, tenancy by the entireties, domestic trusts, beneficiary controlled trusts, corporations and LLCs, "inside out" and "outside in" creditor protection, unbundling, equity stripping, charging order protection and offshore trusts.

Click Asset Protection powerpoint presentation

Funding Living Trusts

by Robert J. Kolasa

 

Attached is the seminar outline I presented before the Wills, Trusts and Probate Committee of the Lake County Bar Association on the funding of Living Trusts. Trust funding is the process of transferring a client's assets to their living trust. Generally, to accomplish this, the client physically change the titles of assets from individual name (or joint names, if married) to the name of the trust.  Trust funding is critical to avoid probate at death and achieve estate planning goals.

Click Funding Living Trusts

The Attorney Planning for Probate

by Robert J. Kolasa

 

Attached is the seminar outline for a presentation I gave before the Chicago Bar Association on selected legal issues an attorney faces in regard to planning a client's estate for probate. The seminar was given almost 20 years ago, but most of the topics discussed therein are still relevant in today's legal environment.

 

Click The Attorney Planning for Probate

Common Estate Planning Mistakes

by Robert J. Kolasa

 

This is a short video highlighting common estate planning mistakes made by my clients, such as: (1) assets passing outside of Trust or Will; (2) improper use of joint tenancy; (3) improper IRA Beneficiary Designations; and (4) procrastination.  Robert J. Kolasa is an estate planning lawyer in Lake Forest Illinois.

 

Click Lake Forest Illinois Estate Planning Mistakes

My Background.

 

I take pride in my highly personalized approach. As an estate planning attorney, I take into account the individual needs and goals of my clients to create  custom tailored estate plans. My background as a C.P.A. and former IRS attorney, along with over a 30-year legal career, complements my “straight talk” and strong technical analysis in leading clients through the estate planning, trust administration and estate tax maze. 

 

I’ve been practicing law since 1983 and hold a C.P.A. license from the State of Illinois. In 1993 I started my own law firm specializing in probate, estate planning, asset protection and trust administration in Lake Forest, Illinois, which is where I also live.  I have a Masters degree in taxation from Georgetown University Law Center (L.L.M. Tax – 1983) and twin degrees from the University of Detroit (J.D. – 1982;  B.S. Accounting, magna cum laude -  1979). I began my legal career in 1983 in the IRS National Office, as an IRS Attorney in the IRS Office of Chief Counsel, Washington, D.C. This is where I began my career as a trust lawyer and developed a sophisticated knowledge of the Internal Revenue Code and the workings of the IRS.

Associations, Speaking Engagements and Publications.

In 2009 I was elected President of the Lake County Estate Planning Council, a non-profit association comprised of the top estate professionals (attorneys, accountants, trust officers, financial, insurance and charitable planners) in Lake County Illinois. I’ve frequently written estate planning legal articles to educate my peers and clients on tax issues, including recent articles regarding projected 2017 tax changes, gifting to save Illinois estate taxes, constitutional challenges to the Illinois income tax on trust income and estate tax portability. I have lectured extensively on probate and estate planning in many seminars and before the Chicago Bar Association, Lake County Bar Association, Lake County Estate Planning Council, North Suburban Bar Association and other groups. I have also taught adult education classes on estate planning and asset protection for the College of Lake County and Highland Park adult education program.  Estate planning seminars are also conducted before the general public.

Kolasa Law Welcome Video
Practice Areas

Legal Services.

 

Robert J. Kolasa, Ltd. offers a full range of estate planning, probate and trust administrative services. These include preparation of wills, revocable living trusts, life insurance, dynasty and other irrevocable trusts, grantor trusts, charitable trusts, family limited partnerships, grantor retained annuity trusts, spoual access trusts, qualified personal residence trusts, stockholder agreements, buy-sell agreements, living wills, durable health and property powers of attorney, property transfers, probate documents, and estate and gift tax returns. In addition to formulating highly personal estate plans, I enjoy helping trustees, executors and guardians fulfill their respective fiduciary responsibilities imposed by state law and the Internal Revenue Code.

Custom Estate Planning and Drafting

 

Beware so called estate planning attorneys who utilize the same forms for ALL their clients, irrespective of financial and family differences. My lawfirm is not a “trust mill” or “one size fit all” practice. Our trusts and estate planning documents reflect the individual needs, financial and family circumstances of the particular client involved. Of the many, many trusts I’ve drafted during my career, no two documents are ever exactly the same. Although there may be similarities between documents drafted for certain classes of clients (i.e., young families with minor children; seniors with adult children; families with special needs children; grandparents wanting to set up educational trusts for their grandchildren), the individual family circumstances of the clients dictate the precise terms of the documents.
 
I painstakingly take my time in the interview process to explain ALL reasonable and practical drafting options to my clients. We then make an informed decision as to what should work for the client’s unique circumstance. Drafts are never “pushed” in front of clients with the directive to “sign here.” We sincerely try to ensure that our clients are cognizant of what they are signing and the reasons why particular legal provisions appear in their documents. In short, there is a high degree of specialization and attention to detail for every estate planning document drafted by me. I would have it no other way.

On December 22, 2017, President Donald J. Trump signed into law the “Tax Cuts and Jobs Act” (the “Act”).   The Act is the most comprehensive tax bill passed in the last 30 years and made substantial changes to our individual, business, international and estate tax rules.    

See my seminar outline “An Overview of the Tax Cuts and Jobs Act,” where I lectured on the Act in New Orleans at a professional conference attended by attorneys from the Trust and Estates and Real Estate Committees of the Lake County Bar Association.

Some of the matters discussed in my outline are as follows:

  • Congress estimated that over a 10-year period, $1.456 trillion will be added to the deficit due to the Act.  Proponents argue that under “dynamic scoring” some of these costs will be mitigated by projected growth.  Time will tell whether this is correct, but the increasing federal deficit should be a concern for all.                                                             

  • Rate Reductions.  The Act makes substantial decreases in the individual and corporate rates and adds the new (and confusing) “QBI” 20% deduction for pass-through entities.                                           

  • Expanded Estate Tax Exclusion Amounts. The Act doubles the federal estate and gift tax exclusion amount from $5.59 million to $11.18 million (2018).                            

  • The individual tax cuts, QBI deduction and estate tax exclusion increases are temporary measures scheduled to expire (“sunset”) on December 31, 2025.   Given our increasing national debt, it is unclear whether Congress will make make these changes permanent in 2025.  Thus, there is a significant possibility that the individual and estate tax cuts will expire in 2026, with reversion to prior law.                                                                    

  • The outline discusses the specifics of many of the individual provisions, including changes to medical expenses; repeal of the casualty loss deduction; elimination of personal exemptions; repeal of the Obama Care individual mandate penalty; 529 Plan changes; repeal of moving expense deduction; changes to charitable deductions; repeal of favorable tax treatment of alimony;                                                                             

  • Liberalization of the Alternative Minimum Tax rules, which should decrease AMT filers to 200,000 (compared to 5,000,000 under prior law);                                 

  • The dramatic increase in the standard deduction (married taxpayers - $24,000; prior law $12,700; single taxpayer $12,000; prior law $6,350).  These changes mean only about 12% of taxpayers (30% under prior law) will now itemize their deductions.                                                          

  • The state and local tax deduction for property and state income taxes (“SALT”) is now capped at $10,000 (married) and $5,000 (single).  These caps will prevent many taxpayers in high property tax states (such as Illinois) from itemizing taking into account the new higher standard deduction limits.  The outline discuses planning strategies to optimally benefit from SALT and charitable deductions in selected years.                                                        

  • The 20% QBI Deduction for pass through entities, along with multiple examples of planning opportunities thereunder. It is expected that many taxpayers will make entity changes, shuffling between sole proprietorship, S Corporation and partnership tax status in order to maximize this deduction.                                

  • Finally, the article discusses the Act’s dramatic doubling of the estate tax exclusion and how this is a “paradigm shift.”   Estate taxes are now not a major concern for many clients;  the increased importance of income tax planning; the increased importance of  having flexible trust provisions and dealing with the loss of “stepped up” basis for credit shelter trusts.

 

 

Welcome to Robert J. Kolasa, Ltd.,

 

Offering customized Estate Planning, Probate and Trust Services in the Lake Forest, IL and surrounding areas!