April 23, 2019

Archives for April 11, 2013

The American Taxpayer Relief Act of 2012: Bidding Adieu to the Sunset (Part 3)

Editor’s Note: This is Part 3 of a 3-Part Series. For Part 1, click here, and for Part 2, click here.

By Merry H. Balson and Laurie A. Hunter

Return of the Charitable IRA Rollover Through 2013. The 2012 Tax Act extended the IRA charitable rollover rules through 2013. These rules were originally put in place in 2006, and had expired at the end of 2011. The charitable IRA rollover provisions allow individuals who are 70 ½ or older to transfer (or “rollover”) up to $100,000 per year from their IRAs to most charities on a “tax neutral” basis if the transfer is a “qualified charitable distribution” and satisfies certain rules. Qualified Charitable Distributions will not count as taxable income to the individual (as would usually be the case in any other distribution from an IRA) but no charitable income tax deduction is allowed for the contribution. Transfers must be directly from the IRA trustee to the charity to qualify. Additionally, transfers to private foundations, donor advised funds, supporting organizations or split-interest trusts (such as charitable remainder or charitable lead trusts) do not qualify for this special treatment. Because the charitable IRA rollover had expired in 2011 and has now been reinstated retroactively for 2012, taxpayers were also allowed to treat distributions from IRAs made after November 20, 2012 and before January 31, 2013 as a charitable IRA rollover for 2012, if that distribution is made in cash to charity before January 31, 2013. As a result, in 2013 taxpayers had an opportunity to give up to $200,000 to charity from their IRAs (with $100,000 treated as given in 2012) if they acted by the end of January.

Other Annual Extenders. The 2012 Tax Act also extended a number of credits and deductions that have been extended year by year for some time, and did not make them “permanent.” These include the American Opportunity Tax Credit,[1] more favorable conservation easement rules,[2] more favorable depreciation rules, the wind energy credit, and research and development credits.

Health Care Act Changes. Finally, changes taking place in 2013 include raising the medical expense deduction to 10% of adjusted gross income from 7.5%, and the new 3.8% surtax on net investment income for single taxpayers with $200,000 “modified” adjusted gross income and $250,000 for married filing jointly.

Conclusion

The 2012 Tax Act is replete with references to permanence. While that might provide comfort to some, keep in mind that the provisions of the 2012 Tax Act are only truly permanent until Congress and the President decide to change them. Until then, we can all breathe a sigh of relief that sunset never came to pass, and for the first time in decades advise our clients about the tax implications of their gifts during life and at death with some measure of certainty.

Merry H. Balson is Of Counsel at Wade Ash Woods Hill & Farley, P.C., where her practice emphasizes estate planning, estate and trust administration and forming and advising exempt organizations. She can be reached at mbalson@wadeash.com or 303-329-2215.

Laurie A. Hunter is a Shareholder at Wade Ash Woods Hill & Farley, P.C., where her practice emphasizes estate planning, probate and trust administration. She can be reached at lhunter@wadeash.com or 303-329-2227.

The opinions and views expressed by Featured Bloggers on CBA-CLE Legal Connection do not necessarily represent the opinions and views of the Colorado Bar Association, the Denver Bar Association, or CBA-CLE, and should not be construed as such.

 


[1] Pub.L. 112-240, Sec. 103, H.R. 8, 126 Stat. 2313 (2013).

[2] Pub.L. 112-240, Sec. 206, H.R. 8, 126 Stat. 2313 (2013).

Tenth Circuit: Unpublished Opinions, 4/10/13

On Wednesday, April 10, 2013, the Tenth Circuit Court of Appeals issued no published opinions and three unpublished opinions.

Beasley v. Colvin

United States v. Cornelio-Legarda

United States v. Mills

No case summaries are provided for unpublished opinions. However, published opinions are summarized and provided by Legal Connection.

Colorado Court of Appeals: Announcement Sheet, 4/11/13

On Thursday, April 11, 2013, the Colorado Court of Appeals issued six published opinions and 46 unpublished opinions.

Larimer County Board of Commissioners v. Colorado Property Tax Administrator

People v. Roberts

People v. Rainer

BDG International, Inc. v. Bowers

People v. Lucero

Youngs v. Industrial Claim Appeals Office

The summaries for these cases are forthcoming, courtesy of The Colorado Lawyer.

Neither State Judicial nor the Colorado Bar Association provides case summaries for unpublished appellate opinions. The case announcement sheet is available here.

HB 13-1266: Aligning Colorado Health Insurance Laws with Provisions of Federal Patient Protection and Affordable Care Act of 2010

On March 18, 2013, Rep. Beth McCann and Sen. Irene Aguilar introduced HB 13-1266 – Concerning the Alignment of State Health Insurance Laws with the Requirements of the Federal “Patient Protection and Affordable Care Act.” This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

The bill aligns the “Colorado Health Care Coverage Act” (Colorado law) with the federal ”Patient Protection and Affordable Care Act of 2010” and the federal “Health Care and Education Reconciliation Act of 2010” (federal law) to give the insurance commissioner the necessary authority to regulate health insurers with respect to new requirements of the federal law. The bill includes the following changes to Colorado law:

  • Makes defined terms in Colorado law consistent with the requirements of federal law;
  • Enacts the terms of Colorado’s essential health benefits package;
  • Conforms Colorado’s current mandatory coverage provisions to the requirements of federal law;
  • Requires all individual and small employer health insurance carriers selling health benefit plans in Colorado to issue and renew plans to all eligible individuals;
  • Conforms Colorado law to federal law requirements for dependent health coverage for persons under 26 years of age;
  • Prohibits discrimination against licensed or certified health care providers by health insurance carriers in the participation of health care providers in individual or group health benefit plans;
  • Conforms Colorado law regulating health insurance rates and the filing of health insurance plans to the requirements of federal law;
  • Aligns Colorado law with federal law for internal and external independent review of adverse determinations of health insurance carriers with respect to denial of benefits;
  • Consistent with federal law, prohibits carriers offering individual or small employer health benefit plans from imposing any preexisting condition exclusion with respect to coverage;
  • Makes wellness and prevention program requirements consistent with federal law;
  • Conforms carrier network adequacy requirements to federal law; and
  • Authorizes the insurance commissioner to adopt rules necessary to comply with requirements of federal law.

On March 28, the Health, Insurance & Environment Committee amended the bill and sent it to the floor of the House for consideration on 2nd Reading.

Since this summary, the bill passed Second Reading in the House with amendments, then passed Third Reading and was assigned to the Health & Human Services Committee in the Senate.

HB 13-1259: Making Several Amendments to Procedures for Civil Actions Involving Parental Rights and Responsibilities in Cases Involving Abuse and Neglect

On March 11, 2013, Rep. Beth McCann and Sen. Linda Newell introduced HB 13-1259 – Concerning Civil Actions, and, in Connection Therewith, Procedures for Allocating Parental Rights and Responsibilities in the Best Interests of the Child in Cases Involving Child Abuse and Neglect and Domestic Violence; Provisions Relating to Parenting Time Orders; Provisions Relating to Parenting Time Evaluations and Reports; and Amending and Relocating Provisions Relating to Civil Protection Orders. This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

The bill makes amendments to various provisions of law relating to civil actions and orders.

The bill amends provisions of article 10 of title 14, Colorado Revised Statutes (C.R.S.), as follows:

  • Includes additional rights of children with respect to the determination of parenting time in section 14-10-123.4, C.R.S.;
  • In the determination of the best interests of a child with respect to the allocation of parental rights and responsibilities pursuant to section 14-10-124, C.R.S.:
    • Requires a court to follow certain procedures in actions where a claim of child abuse or neglect or domestic violence has been made to the court or when the court has reason to believe that a party has committed child abuse or neglect or domestic violence;
    • In contested hearings on final orders, requires the court to make findings on the record concerning the factors the court considered and the reasons for the allocation of rights and responsibilities;
    • Permits the court to allocate mutual decision-making for a child in a case that involves domestic violence, over objections, if the court makes certain findings;
    • Requires the court to consider the current statutory factors concerning the best interests of the child in light of any finding of child abuse or neglect or domestic violence;
    • Includes certain factors that the court may consider when formulating or approving a parenting plan in cases where one of the parties has committed child abuse or neglect or domestic violence;
    • Permits the court to order a domestic violence evaluation and subsequent evaluations and to require a party to participate in domestic violence treatment; and
    • Includes general procedures that may be included in parenting plans;
  • Provides that a court is not required to order a parenting time evaluation pursuant to section 14-10-127, C.R.S., and includes a list of factors that the court shall consider in determining whether to order an evaluation; and
  • In section 14-10-129, C.R.S., expands language relating to domestic violence and increases the time within which the court must hear and rule on an emergency motion to restrict parenting time from 7 days to 14 days.

The bill amends, repeals, and relocates the provisions of part 1 of article 14 of title 13 relating to civil protection orders, as follows:

  • Moves the legislative declaration currently contained in section 13-14-102 (1), C.R.S., to a new section and adds additional language to the legislative declaration;
  • Amends section 13-14-101, C.R.S., containing definitions for article 14 to include a new definition for “contact” and “sexual assault or abuse,” and amends existing definitions for “domestic abuse,” “protection order,” and “stalking”;
  • Repeals section 14-13-102, C.R.S., and relocates provisions of that section, with amendments, to other sections in article 14;
  • Adds additional behaviors to the list of behaviors for which a court may enter an emergency protection order;
  • Repeals section 13-14-104, C.R.S., relating to foreign protection orders and relocates those provisions, with amendments, to the new section 13-14-110, C.R.S.;
  • Creates a new section 13-14-104.5, C.R.S., that includes provisions relating to temporary civil protection orders that are relocated from 13-14-102, C.R.S., with amendments, that:
    • Adds to the list of behaviors for which a temporary civil protection order may be entered;
    • Clarifies that a petitioner is not required to show that: he or she has reported the act that is the subject of the complaint to law enforcement, that charges have been filed, or that he or she is participating in the prosecution of the criminal matter; and
    • An order awarding temporary care and control of the child may be extended for not more than one year;
  • Creates a new section 13-14-105, C.R.S., that contains provisions that are relocated from section 13-14-102, C.R.S., with amendments, and adding additional provisions that a court may include as part of a civil protection order;
  • Creates a new section 13-14-106, C.R.S., that contains provisions that are relocated from section 13-14-102, C.R.S., with amendments, relating to procedures for permanent civil protection orders and clarifies that the court need not find that the petitioner is in imminent danger in order to grant a permanent civil protection order; and that the court may continue a temporary civil protection order and the show cause hearing for one year for good cause;
  • Creates a new section 13-14-107, C.R.S., that contains provisions that are relocated from section 13-14-102, C.R.S., with amendments, relating to enforcement of protection orders and duties of peace officers;
  • Creates a new section 13-14-108, C.R.S., that contains provisions that are relocated from section 13-14-102, C.R.S., with amendments, relating to the modification and termination of civil protection orders that:
    • Allows a restrained party to file for modification or dismissal of a permanent civil protection order 2 years after the order was entered or after the disposition of a prior motion; and
    • Permits the court to consider whether the protection order has been successful in preventing harm to the protected person as grounds to deny the modification or dismissal of a permanent civil protection order;
  • Creates a new section 13-14-109, C.R.S., that contains provisions that are relocated from section 13-14-102, C.R.S., with amendments, relating to civil protection orders fees and costs; and
  • Creates a new section 13-14-110, C.R.S., that contains provisions that are relocated from section 13-14-104, C.R.S., with amendments, relating to foreign protection orders.

At the request of the Family Law Section, the CBA Legislative Policy has voted to oppose the bill in its current form. On April 4, the Public Health Care & Human Services Committee amended the bill and sent it to the Appropriations Committee for consideration of the fiscal impact.

HB 13-1258: Repealing Title 29, Article 29, of the Colorado Revised Statutes Regarding Reporting Persons Illegally in the U.S. to Federal Officials

On March 8, 2013, Rep. Angela Williams and Sen. Andy Kerr introduced HB 13-1258 – Concerning Local Government Involvement with Federal Immigration Issues. This summary is published here courtesy of the Colorado Bar Association’s e-Legislative Report.

Current law prohibits local governments from enacting any policy that limits or prohibits a local peace officer, official, or employee from communicating or cooperating with federal officials with regard to the immigration status of any person in the state. The law also requires a peace officer who has probable cause to believe an arrestee is not legally present in the U.S. to report that person to the U.S. immigration and customs enforcement office. The governing body of each local government is currently required to provide notice to peace officers of the duty to cooperate with state and federal officials with regard to enforcement of state and federal immigration laws and to provide written confirmation that it has done so to the general assembly on an annual basis. The bill repeals these provisions. The bill cleared the House and passed 2nd Reading in the Senate on April 5.

Since this summary, the bill passed Third Reading in the Senate on April 8.