A Boutique Trusts & Estates Law Firm

How NOT to Probate an Estate

Monday, May 12th, 2014

Serving as a Personal Representative can lead to headaches if you don’t follow the rules.

Consider a recent federal case, United States v. Shriner. Mrs. Shriner died in 2004, and she failed to file income tax returns for the last several years of her life. Her two sons were appointed as Co-Personal Representatives of her estate, and they hired an attorney to file the missing tax returns. They also told the IRS to send all tax notices to the attorney.

The IRS notified the attorney (several times) that the estate owed over $275,000 in back taxes. (Mrs. Shriner apparently did well for herself.) By early 2006, the sons had distributed $470,000 to themselves as beneficiaries of the estate, leaving behind too little money for the estate to pay the tax bill. The IRS was not amused.

Under federal tax law, the sons were now personally liable for their mother’s back taxes, but only if they “knew or should have known” about the tax bill before they distributed the money. The sons claimed they did not know, and they blamed their attorney (naturally) for not telling them. To the court, that was no excuse, and it ordered the sons to pay a total of $333,000, including interest and penalties.

Was it really the attorney’s fault? The federal court did not say, but it appears the local probate court thought otherwise. According to the website for the Maryland Registers of Wills, the sons are no longer serving as Personal Representatives, but their attorney continues to serve as attorney for the estate.

The sons learned the hard way that beneficiaries should only get paid after all creditors, especially the IRS. Their plight is eased by the fact that they received enough money from the estate to pay the tax bill, but their liability would be the same even if they had distributed that money to other beneficiaries. Their problem was not that they received the money but that they distributed it at all.

Maryland and federal law establish several tiers of creditors of estates, and these creditors must get paid in the proper order of priority, or else the Personal Representative will be personally liable for any higher-priority debts that go unpaid. A Personal Representative who wants to avoid traps such as this one should seek the advice of a knowledgeable probate attorney (and to heed that advice).

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For Immediate Release

Contact: Jane Frankel Sims

410-828-7775

Contact: Frank Campbell

410-263-1667

Sims & Campbell Estates and Trusts

Frankel Sims Law and Holden & Campbell
Merge to Form Sims & Campbell

Firm will offer comprehensive Trusts & Estates services through offices in Towson and Annapolis

TOWSON, Md. (April 26,2019)  Frankel Sims Law and Holden & Campbell have jointly announced the merger of their firms to create a boutique Trusts & Estates law firm providing comprehensive services in the fields of Estate Planning, Estate Administration, Trust Administration and Charitable Giving. The combined firm will be named Sims & Campbell and have offices in Towson, Md. and Annapolis, Md.  Jane Frankel Sims and Frank Campbell will lead and hold equal ownership stakes in the firm.

Sims & Campbell will have 9 attorneys and 15 legal professionals that handle every facet of estate and wealth transfer planning, including wills, revocable living trusts, irrevocable trusts, estate and gift tax advice, and charitable giving strategies.  The firm will focus solely on Trusts & Estates but will serve a wide range of clients, from young families with modest resources to ultra-high net worth individuals.  This allows clients to remain with the firm as their level of wealth and the complexity of related estate and tax implications change over time. 

“By joining forces, we have expanded our footprint to conveniently serve clients in Maryland, D.C. and Virginia” said Jane Frankel Sims.  We are seeing some of the greatest wealth transfer in our country’s history, and we want to continue to be on the leading edge of helping our clients maintain and enhance their family’s wealth.  In addition, we aim to serve our clients for years to come, and the new firm structure will allow Sims & Campbell to thrive even after Frank and I have retired.”    

“Jane and I have always admired each other’s firms and recognized the need to provide even greater depth and breadth of focused expertise to help families amass and protect their wealth from generation to generation,” said Frank Campbell.  “Now we have even greater capabilities to make a real difference for our clients.” 

The Sims & Campbell Towson office is located at 500 York Road, on the corner of York Road and Pennsylvania Avenue in the heart of Towson.  The Annapolis office is currently located at 716 Melvin Avenue, and is moving to 181 Truman Parkway in August, 2019.  For more information, visit www.simscampbell.law.