A Blizzard of Bills

The 2016 session of the Maryland General Assembly began officially in mid-January and is now in full swing.  After Assembly’s prompt override of five bills vetoed by the Governor in 2015, we are now expecting a blizzard of new bills.  This year, following the completion in 2015 of the freshman year of many new legislators in Annapolis, we are going to see a huge bump in the number of bills that will be introduced in 2016.  New legislators, as well as the veterans, wish to make their mark on the Maryland Annotated Code.  The deadline for legislators to timely introduce their bills is rapidly approaching. As is true every year, much of the Assembly’s energy will be taken up with considering the Governor’s budget, and this year, our representatives will spend significant time dealing with the Governor’s agenda on taxes – essentially wrangling over which group should receive tax breaks under the Governor’s plan.  Some other expected hot topics will deal with reform of the criminal justice system in the aftermath of Freddie Gray’s death in Baltimore last year, end of life decisions, and changes in voting eligibility requirements. Advocates in the domestic violence arena will be seeking change in the definition of stalking.  HB 155 and SB 278, bills cross-filed in both the House and Senate, alter the definition of stalking as a course of conduct that includes approaching or pursuing another where the person intends to cause or knows or reasonably should have known that the conduct would cause serious emotional distress.  Under current law, the State must prove that the course of conduct is malicious and...

Gifting: Legal Considerations

It may seem counter-intuitive during the holiday season, but giving gifts to others may generate a tax issue.  The IRS defines a gift as any transfer to an individual where nothing is received in return (the full definition can be found here).  This transfer can be in the form of tangible personal property (stuff), real property (land or a house), or intangible personal property (cash, stocks, and bonds).  Gifts can also be in the form of a charitable donation or a necessary expense. It is important to consider how the federal government assesses these gifts in terms of estate planning. The total amount of a gift from a single individual to a single individual cannot exceed the annual gift tax exclusion for the current calendar year.  For gifting in 2015, and in the upcoming New Year, this exclusion amount is $14,000. This means that a single individual can gift up to $14,000 to one person, without having to pay the federal “gift tax.”   Spouses who choose to give jointly, a “split gift,” may give up to $28,000 to a person during the year without incurring a gift tax. There are no limitations on a donor with regard to the number of people who can receive a gift in a single year.  For example, if a parent has five children and five grandchildren, that parent/grandparent can present each child and grandchild with a gift worth up to $14,000 without having to incur the gift tax.  In this scenario, there are ten individuals who can receive a substantial gift for a hefty total of $140,000 in a single calendar year.  Over...

New Law on Grounds for Divorce and Domestic Violence to Go Into Effect on October 1st

In Maryland, October 1 is the date when most legislation passed by the General Assembly and signed into law by the Governor goes into effect.  In 2015, some major changes occurred in family law.  For divorcing couples who do not have minor children and who can come to agreement about property and alimony issues, there is no need to separate and wait one year before filing for an absolute (final) divorce based on the ground of mutual consent.  This development significantly eases the path for couples who seek an uncontested divorce because no one year waiting period will be required before a complaint for absolute divorce can be filed in court. Another law related to grounds for divorce will also become effective October 1.  While it may not have as much of an impact as the new ground of mutual consent for an absolute divorce, it will now be possible to apply for a limited divorce based on separation of the parties.  Previously, before filing a claim for a limited divorce based on a separation of the parties, the moving party was required to prove that the separation of the parties was the result of a voluntary agreement by both parties.   In certain difficult situations where parties cannot reach an agreement about separation, this change in the law will allow one of the parties to move from the marital home and begin a court proceeding promptly.  While it is usually desirable to resolve pending issues between unhappy members of a couple without beginning the procedure with a court filing, in certain situations, a court action is the first step...

What Can I Do to Manage My Time During the Divorce Process?

  For most people, the prospect of divorce presents a challenge in managing time.  As the daily pace of life accelerates, the added burden of re-organizing a family can create major stress.  While this observation is hardly a major newsflash, thoughtful and deliberate management of time can reduce the difficulty of this transaction. In litigated disputes, an often underappreciated element of the case is the scheduling order.  This is a court order that sets out the time line for the completion of certain tasks in advance of any court proceeding.   It is created at the onset of the case and tells attorneys and parties what is expected.  Noting specific deadlines on a personal or professional calendar will avoid error.  Similarly, understanding the steps of the litigation process as noted in the scheduling order helps parties know what to do to prepare the materials before going to court. In situations where no court action is pending, there is no formal scheduling order so managing time to deal with divorce planning may not be obvious.  However, retrieving and organizing specific information related to a family’s assets and liabilities and income and expenses are basic to understanding how a case may resolve.  To that end, dividing what may be a major project into small achievable steps may help with time management.  Creating a clear record of monthly expenses by something as simple as maintaining an envelope with receipts of these expenses may also be useful. Consultation with an experienced attorney can also assist in preparing the appropriate information during the divorce...

Notes From Annapolis: Speeding Up Divorce

In 2015, the Maryland General Assembly modified one of the basic elements of proof necessary to obtain an absolute (or final) divorce in Maryland.  The amount of time one of the parties must reside in Maryland before being eligible to petition a Maryland court for an absolute divorce has been reduced from one year to six months.  This new residency requirement becomes effective on October 1st. This legislative change was brought to the attention of the General Assembly by military attorneys who work primarily at Ft. Meade and is intended to assist service members. People in the military are often transferred during the course of their duty and have difficulty meeting the one year standard.  This change in the Code to require only a six month residency may accelerate the divorce process for newcomers to Maryland.  Of course, this change is available to all persons who file for divorce in...

Notes From Annapolis: Death, Disability, and Digital Assets

In the aftermath of the 2015 session of the Maryland General Assembly, we naturally focus our attention on bills passed by the Assembly and signed by the Governor.  But as we sift through the accomplishments of our elected officials, it is always important to consider the bills that did not pass and the problems that may ensue without adjustment to our Code. One such bill that did not receive a favorable review this year is the Maryland Fiduciary Access to Digital Assets Act (SB 429/HB 531).  If enacted, this bill would vest fiduciaries with the authority to access, control, or copy digital assets and accounts.  Typically such accounts – Facebook, e-mails, tweets and other on-line accounts – are governed by the contract created by the user of the account and the provider of the service without any reference to fiduciaries. Under the bill, fiduciary means a personal representative, guardian, agent acting pursuant to a power of attorney, trustee or advisor.    In essence, the bill would enable a fiduciary to “step into the shoes” of the account holder.  The fiduciary could take action that the account holder can take and would be bound by the same limitations of the account holder. While opponents of this bill cited concerns about the privacy of the account holder, as we collectively become more and more engaged in electronic communications and transactions, it is becoming increasingly apparent that those who are entrusted with managing our affairs – the fiduciaries we count on to perform tasks on our behalf – can encounter significant obstacles in dealing with on line transactions.  For example, in estate administration,...