Attorney’s Guide to Grantor Trusts: Includes Ethics

David F. Johnson | Winstead P.C

Through his trial and appellate experience, David aggressively strives to obtain the absolute best results possible for his clients. David maintains an active trial and appellate practice. David has consistently worked on fiduciary litigation matters as both lead trial and appellate counsel throughout his career. David has specialized in estate and trust disputes including will contests, mental competency issues, undue influence, trust modification/clarification, breach of fiduciary duty and related claims, and accountings.

David is the primary author of the Texas Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary field in Texas.

David is a unique lawyer in that he has extensive trial and appellate experience, which has resulted in his achieving board certifications in civil trial law, civil appellate, and personal injury trial law by the Texas Board of Legal Specialization. Out of approximately 84,000 licensed attorneys in Texas, David is one of less than twenty attorneys with this particular triple certification in civil appellate, civil trial and personal injury trial law. David is also a member of the Civil Trial Law Commission of the Texas Board of Legal Specialization. This commission writes and grades the exam for new applicants for civil trial law certification.

David previously taught Appellate Advocacy at Texas Wesleyan University School of Law located in Fort Worth. David is licensed and has practiced in the U.S. Supreme Court; the Fifth, Seventh, and Eleventh Federal Circuits; the Federal District Courts for the Northern, Eastern, and Western Districts of Texas; the Texas Supreme Court and various Texas intermediate appellate courts. Although David is based in Fort Worth (Tarrant County, Texas), he has a state-wide and national appellate practice.

David also served as an adjunct professor at Baylor University Law School, where he taught products liability and portions of health law. He has authored many legal articles and spoken at numerous legal education courses on both trial and appellate issues. His articles have been cited as authority by the Texas Supreme Court (twice) and the Texas Courts of Appeals located in Waco, Texarkana, Beaumont, Tyler and Houston (Fourteenth District), and a federal district court in Pennsylvania. David’s articles also have been cited by McDonald and Carlson in their Texas Civil Practice treatise, William v. Dorsaneo in the Texas Litigation Guide, and various authors in the Baylor Law Review, St. Mary’s Law Journal, South Texas Law Review and Tennessee Law Review.

Brian M. Seelinger | Knox McLaughlin Gornall & Sennett, P.C

Brian has spent his career solving complex financial challenges. He is compassionate while maintaining a process oriented methodology. Examining a situation from multiple angles while being able to communicate across business roles is one of his strengths. His breadth of experience across roles and industries provides clients a 360 degree view of situations, often providing unique but simple solutions while also able to engage in the most complex financial situations.

Brian was most recently a Senior Portfolio Manager and Vice President in the Trust Department of a publicly traded multistate bank. While there he worked with institutional and personal clients, including municipal governments, pensions, non-profits, guardianships, foundations, endowments, authorities, trusts, small businesses, and high‑net worth clients. Beyond investment management he also performed a variety of fiduciary and compliance tasks regarding ERISA, mutual fund selection, financial modeling, risk management, financial projections, and tax planning.

He also has experience as an entrepreneur at a regional technology firm, growing it to over $40 million in sales and managing more than 30 employees. He has negotiated more than $200 million in contracts, and has lead multi-year projects involving technical, finance, accounting, and operating staff as the liaison able to speak the “language” of each area. Brian knows the stress of running a growing business and making a payroll.

Session I – Grantor Trusts: A Primer | 1:00pm – 3:10pm

• Synopsis of grantor trusts
  • History of grantor trusts
  • The code sections
    1. Enabling provisions
    2. Tax rates
  • Grantor trust triggers
    1. Reversionary interest
    2. Control of beneficial enjoyment
    3. Administrative powers
    4. Revocation powers
    5. Income for the benefit of grantor
• Use cases for grantor trusts
  • Avoid probate
  • Medicaid planning
  • Leveraged gifting
  • Business succession

Break | 2:00pm – 2:10pm

• Potential issues for the unwary
  • Grantor definition
    1. Spousal provision
    2. Subservient provision
    3. Adverse party
  • Reporting income
    1. Traditional method (1041 attachment)
    2. Disregarded entity (SSN reporting)
    3. 1099/1096 reporting
• Drafting tips
  • Synopsis
  • Estate tax
  • Income tax
    1. Keeping the trust sustainable

Break | 3:10pm – 3:20pm

Session II – Ethics in Estate Planning, Probate, and Trust Administration | 3:20pm – 4:20pm

• Determining who the client is
• Joint representation
• Client communications and confidentiality issues: ABA Model Rule 1.6
• Conflicts of interest: ABA Model Rule 1.7
• Diminished capacity and competency: ABA Model Rule 1.14
• Attorneys acting in other fiduciary capacities