STEP

ADVISING FAMILIES ACROSS GENERATIONS

I just completed the Inaugural STEP USA Conference that reminded me why I’m proud to be a STEP member.

Fraudulent Transfers or Voidable Transactions?

Here is a nice analysis of fraudulent transfer law by Jay Adkisson in light of the Uniform Voidable Transactions Act of 2014 (formerly the Uniform Fraudulent Transfer Act).

“The Uniform Voidable Transactions Act – What’s With The Name Change?”

(This article is the first in a series on the Uniform Voidable Transactions Act of 2014 (“UVTA”) , as found at  http://goo.gl/kS7MqZ  [PDF] and adopted by the Uniform Law Commission on July 16, 2014. [Jay Adkisson] was an American Bar Association Advisor to the Drafting Committee to this Act.)

Our modern law of fraudulent transfers can be traced to Roman Law. When the Byzantine Emperor Justinian I commanded that great compilation or Roman Law known as the Corpus Juris Civilis, or more commonly the Civil Code, the accompanying commentary known as the Institutes of Justinian gave a very detailed treatment of fraudulent transfer law which in substance is little changed from when those Institutes were published in the year 533 A.D.

In the Institutes, we are given the basic concept of a fraudulent transfer as a transfer by a debtor that is meant to defeat the creditors of the debtor. The standard remedy was that the transfer could be avoided by the creditor; that is, treated as if the transfer had never occurred at all, and the transferred asset was still owned by the creditor. However, if the creditor could not be satisfied by unwinding the transaction, then the creditor may obtain a money judgment against the transferee for the value of the asset that was transferred. If the transferee did not know the debtor had outstanding creditors, and the transferee paid equivalent value for the asset, then the transferee had a valid defense against the creditor’s action for the fraudulent transfer.

These are the basic concepts of Roman fraudulent transfer law, and are the basic concepts of American fraudulent transfer law as well. In fact, the Romans considered these issues in far more depth than I have just briefly described, such as in holding that if a debtor refused to accept an inheritance so that those assets would not go to his creditors (what we could today call a “disclaimer”), that was not a fraudulent transfer, as is now stated in the probate laws of most states.

It is widely presumed that the American law of fraudulent transfers derives in whole from English law, more particularly the Fraudulent Conveyances Act of 1571, sometimes referred to as the Statute of 13 Elizabeth. There is some truth to that, but only in part.

Continue reading  . . . 

New IRS Rule for 2014

By – Gerry W. Beyer

 

“Effective January 1, the IRS requires those assigned an Employer Identification Number (EIN) to provide periodic updated information.

EINs are the equivalent of a Social Security number for taxpayers other than individuals, such as corporations, LLCs, trusts, and government agencies.  The new rule requires these entities to update information related to “responsible parties” and changes in business addresses.  If an entity has a change in the identity of its responsible party, the updated information must be filed with the IRS within 60 days using the Form 8822-B.  Changes before January 1 must be reported to the IRS no later than March 1.

See Stephen Sherman, What You Should Know About a New IRS Rule for 2014, Stoll Kennon Ogden LLP, Jan. 24, 2014.”