Can I Keep My House If I File a Chapter 7 Bankruptcy?
Student loans and credit cards have fueled a spike in filing personal bankruptcy in Minnesota last year, with a 54 % increase from the previous year. For personal bankruptcy, most people file a Chapter 7 or Chapter 13. This article will focus on Chapter 7 and the exemptions Minnesota offers in terms of protecting your house. You can qualify for a Chapter 7 bankruptcy by passing the “means test.” The means test is a two-prong analysis of your household income. If you fall below it, you can file a Chapter 7 bankruptcy, meaning almost all of your debt would be wiped away with a... Read More
2024 Eviction Law Updates
The Minnesota legislature passed new renter protections that took effect on January 1, 2024, that landlords must follow to evict tenants. As of April 2024, landlords must: Give renters 14 days’ notice before filing an eviction; include all required fees in the advertised rent; ensure units maintain a temperature of at least 68 degrees during the winter; and provide tenants 24 hours’ notice before entering a unit. All evictions will be removed from a tenant’s record after three years. Evictions can be expunged sooner if the renter and landlord agree to it as part of a settlement; for example, in... Read More
Electronic Will Act
Effective August 1, 2023, the Uniform Electronic Wills Act (Act) has been adopted by State of Minnesota. This Act has significant ramifications for Minnesotans seeking to adopt an estate plan. Prior to the adoption, Minnesota required a physical signature for a Will to be valid. Although for the past decade or so, many legal and financial documents were considered valid when signed or notarized electronically, the execution of a Will was the exception, until now. The new law authorizes the creation, witnessing and notarization of wills electronically. The Act defines an Electronic Will as “a will or codicil that (i)... Read More
Estate Tax Exemption Changes for 2024
The federal estate and gift tax exemption continues to increase. For the tax year 2024, the estate/gift exemption is $13,610,000 per individual or $27,220,000 for a married couple. The top tax rate for estate taxes remains at 40%. The federal estate tax provisions still include the concept of “portability”. Portability allows a married couple to double the estate tax exclusion. For 2024, married couples are able to protect $27,220,000 without incurring federal estate tax. However, absent action by Congress, the estate tax rates are scheduled to sunset on January 1, 2026. At sunset, the estate tax exemption will revert to... Read More
What is the difference between Probate and Non-probate Assets?
As an estate planning attorney, one of the most common misconceptions I hear is, “I have a Will, so my family will avoid a probate proceeding.” This is simply not the case. Having a Will alone will not keep your estate from going before a probate court. A Will simply allows you to direct how your assets are dispersed and who gets them. Whether or not an estate will be probated depends on what assets the decedent (the person who has died) owns at the time of death and how they owned them. Assets that are left only in the... Read More
How Often Should I Update My Estate Plan?
Having an estate plan is an important step that everyone should contemplate. It allows you to direct where your hard-earned and cherished assets go, ultimately deciding who gets them and when and how they will inherit. A question I often get asked is, “How often should I update my Will or Trust document?” In typical lawyer fashion, the short answer is, it depends on your individual situation. However, your estate planning documents should be reviewed every so often, roughly every 3–7 years. Here are some instances in which an update or review of your estate plan should be considered: 1.)... Read More
You Have Inherited Farmland. Now What?
Inheriting farmland can be more complicated than simply receiving the title to the real estate. Inherited farmland can take many forms including from a lifetime gift, or estate, or a trust. Considerations may differ depending on whether you have inherited farmland outright or in and entity such as a Trust, Corporation, or LLC. Although Minnesota has no inheritance tax, the farmland in a Trust or Estate may be subject to an Estate Tax or Gift Tax depending on how it was received. Additionally, whether the land can be designated as Homestead will determine your real estate tax obligations. You... Read More
Don’t Forget Your Will and Fall Cleaning To-Do List
Fall is traditionally a time for taking stock, reorganizing, and preparing. Don’t forget to add creating or updating your Will to your fall to-do list. Your Will is an essential document directing the transfer of your property when you die. A Will is necessary if you wish to make specific gifts to friends, loved ones, or charities. A Will allows you the opportunity to dispose of your assets after you die to people or organizations that normally would not inherit any portion of your estate. You can also identify specific assets that are unique to your estate such as family... Read More
Are Retirement Accounts Protected in a Bankruptcy?
Since the Covid-19 pandemic-era relief programs are slowly expiring, bankruptcy cases are exponentially increasing in Minnesota. For bankruptcy cases, I often get asked, “will my retirement account(s) be exposed to the trustee? Are they protected?” The answer is almost always yes. Under both the state and federal exemptions an ERISA qualified plan is protected in full (barring some last-minute transfers). The plans are protected, not just because they are exempt, but because they never become property of the bankruptcy estate and do not need to be exempted. The language of the ERISA statute essentially creates a spendthrift trust. If you... Read More
Expungement of Eviction Records
In Housing & Redevelopment Authority of Duluth, MN v. Young, the Minnesota Court of Appeals held that district courts have the inherent authority to expunge judicially held eviction records. Young was evicted from an apartment. After his eviction, he became homeless and claimed resulting harm to his mental and physical health. Moreover, while housed, he had received care from a personal-care assistant, which he could no longer have without a home. Instead of seeking expungement of his record under various statutory criteria, he sought expungement under the court’s inherent authority. In holding that the district court had inherent expungement authority,... Read More