IN THIS ISSUE

LATE ELECTION ALLOWED



PROMISES IN A PRENUPTIAL

AGREEMENT ARE NOT

DEDUCTIBLE

PROGRESS REPORT

ARTICLES OF INTEREST

As the days grow longer and the first signs of spring emerge, many of us feel the familiar urge to declutter our homes--packing away winter gear, clearing out closets, and freshening up our living spaces. But while you're sorting through old boxes and deciding what to keep or toss, it's worth asking a broader question: what kind of clutter are you leaving behind for your heirs?

Estate planning is often thought of in terms of documents--wills, trusts, and beneficiary designations. Yet, one of the most overlooked aspects of a well-prepared estate is organization. Over time, we all accumulate not just possessions, but also paperwork and account statements. Without a clear system in place, that accumulation can become a significant burden for loved ones tasked with settling your affairs.

Spring is an ideal time to take a fresh look at your estate--not just from a legal standpoint, but from a practical one.

The Hidden Weight of "Stuff"

Clutter doesn't just mean overflowing attics or packed garages. It also includes file cabinets full of outdated financial statements, multiple bank or investment accounts that could be consolidated, and unclear records of ownership of assets. Even digital clutter--passwords, online accounts, and subscriptions--can create confusion if not properly documented.

When a loved one passes away, heirs are often left to piece together a financial and personal puzzle during a time of grief. Missing documents, unknown accounts, or unclear instructions can lead to delays, unnecessary expenses, and even family conflict. What might seem like harmless accumulation during your lifetime can become a logistical and emotional challenge for those you leave behind.

Start With an Inventory

A productive first step in "spring cleaning" your estate is creating a comprehensive inventory. This should include:

• Financial accounts (banking, brokerage, retirement)
• Insurance policies
• Real estate holdings
• Business interests
• Valuable personal property
• Digital assets and online accounts

Think of this as a roadmap for your heirs. The goal is not just to list what you own, but to make it easy for someone else to locate and understand those assets when the time comes.

As you review your inventory, you may notice opportunities to simplify. Do you have multiple dormant accounts that could be consolidated? Are there old insurance policies that no longer serve a purpose? Are beneficiary designations up to date? Simplification reduces the administrative burden on your estate and minimizes the chances of assets being overlooked. It also allows your estate plan to function more efficiently, ensuring that your intentions are carried out with fewer obstacles.

Not everything can--or should--be eliminated. But everything you keep should be organized. Important documents such as wills, trusts, powers of attorney, and healthcare directives should be stored in a secure but accessible location. Just as importantly, your fiduciaries--executors, trustees, or agents--should know where to find them.

Consider creating a centralized estate binder or a secure digital vault. Include not only legal documents, but also instructions, contact information for advisors, and a summary of your wishes. This level of organization can make an immeasurable difference for your family.

Tangible items often carry the greatest emotional weight. Family heirlooms, collections, and sentimental belongings can sometimes lead to disagreements if expectations are unclear. Spring cleaning provides an opportunity to have conversations with family members about what matters most to them. You may even choose to begin distributing certain items during your lifetime, allowing you to see them appreciated and reducing the complexity of your estate later.

In today's world, much of our lives exist online. From banking and investment platforms to social media and photo storage, digital assets are an increasingly important part of estate planning.

Make sure your executor or a trusted individual has a way to access these accounts, whether through a password manager or documented instructions. Without this, valuable or meaningful digital assets may be lost or inaccessible.

Ultimately, estate planning is not just about transferring wealth, it's about providing clarity, reducing stress, and preserving family harmony. By taking the time to "spring clean" your estate, you are giving your heirs a meaningful gift: the ability to focus on what truly matters, rather than being overwhelmed by avoidable complications.

As you open windows and clear out closets this season, consider extending that same effort to your financial and personal affairs. A little organization today can spare your loved ones a great deal of difficulty tomorrow--and ensure that your legacy is one of care, not clutter. Should you want some advice on this "spring cleaning" call one of our trust officers at Garden State Trust Company.

MONTHLY QUESTION & ANSWER

Q. What is the maximum Social Security benefit these days? Do you think it's sustainable?

A. According to the Social Security Administration, an individual who earned more than the maximum taxable earnings consistently since entering the workforce at age 22 would be entitled to a monthly benefit of $5,181 if they retired at age 70 or later in 2026. That's $62,172 per year, and it will be increased for future inflation. For those with maximum lifetime earnings retiring at age 67 the monthly benefit would be $4,207, and the early retirees (age 62) would get $2,969. The data may be found at https://www.ssa.gov/oact/COLA/examplemax.html

Keep in mind that these numbers do not reflect deductions for Medicare premiums. The average retirement benefit in January 2026 was $2,074.53.

The Committee for a Responsible Budget believes that these maximum benefit levels are not sustainable. They have proposed a benefit cap of $100,000 per household, and an individual cap of $50,000 for benefits claimed at full retirement age (67) or a $62,000 cap for those who defer to age 70. The limits would not be inflation adjusted for 20 or 30 years, so that over time more and more retirees would be subject to them. At the moment, couples with two earners would be most likely to be affected, an estimated 0.05% of retirees. The plan has been estimated to reduce the actuarial deficit in the Social Security trust funds by about 20%.

However, Congress has not yet shown much interest in changing the taxes or benefits for Social Security.

        (April 2026)

     © 2026 M.A. Co. All rights reserved.

HAVE A QUESTION ON TRUSTS, WILLS, OR INVESTMENT MANAGEMENT?

For general informational purposes only. This information does not constitute legal advice.

Fulfillment of a promise to provide an inheritance for stepchildren is not a deductible expense of estate administration. Read more in this month’s Promises In A Prenuptial Agreement Are Not Deductible Informational Article.

Life is full of “What If” questions—and while we can’t predict the future, we can prepare for it. Estate planning and financial planning are tools to protect your loved ones, your assets, and your legacy. Take a look at our Life’s “What If” Questions: Planning For Peace of Mind brochure in our Of Interest Articles section this month.

For all of us who understand, “April is the month where my allergies remind me that nature has a sense of humor – and I’m the recurring punchline.”

– Unknown

Sincerely,

Decedent's estate was small enough that no federal estate tax return was required. He therefore did have unused federal estate tax exemption amounts, and these are portable to the surviving spouse upon making the election on an estate tax return. For "various reasons" no estate tax return was filed at the time. Now the surviving spouse would like to have that additional protection from federal transfer taxes, so a request for an extension of time to file the return has been made. The answer to the request is made via a private letter ruling. Recently two such rulings were published, Private Letter Ruling 202609001 and Private Letter Ruling 202609006.

In both cases the IRS granted the request. Because the estates were so small, and no estate tax return was required by law, the Service has greater administrative flexibility in such a situation. The contents of the affidavits and representations submitted to the IRS explaining the tardiness were not revealed in the ruling, nor was it revealed just how tardy the request was, but each was held sufficient to meet the requirements of the IRS Regulations. Accordingly, the estates were given another 120 days to file the return.

Given the steady expansion of the amount exempt from federal estate and gift tax, the tax is now likely to affect less than 1% of estates, so why are there so many requests for extensions to claim the Deceased Spousal Unused Exemption? One possibility is that the strong stock market returns in recent years has lifted the value of surviving spouses' estates into the taxable area. Another is that some taxpayers and estate planners may fear that a future Congress will reduce the exempt amount--a number of Congressmen have advocated for exactly that policy. Claiming the unused exemption may be a hedge against future tax increases.

(April 2026)
© 2026 M.A. Co. All rights reserved.

Richard Spizzirri had been married and divorced three times before he married his fourth wife, Holly Leuders. Naturally, they executed a prenuptial agreement, given that Richard was then worth between $24.7 million and $27.7 million, while Holly brought $1 million to the marriage. During their 18-year marriage, the prenup was amended five times. The key change was that Holly released earlier promises of a share of Richard's estate for his commitment to provide $6 million in his will for her and $1 million for each of her three children from a prior marriage.

The couple became estranged, and Richard fathered two children outside of marriage, in addition to the four he had with his first wife. His will largely left his estate to the four children from his first marriage. In three codicils he added provisions for his sons conceived out of wedlock. He never amended his will as promised, and left nothing at all to his stepchildren.

The stepchildren sued for their inheritance, and Richard's estate paid them, and then tried to make lemonade from that lemon by claiming those payments as an expense of administration. IRS objected, and the Tax Court agreed that the payments are not deductible.

On appeal, the 11th Circuit Court affirmed the Tax Court's judgment. Treasury Regulations list five factors that suggest a transfer was contracted bona fide. First, the transaction underlying the claim occurs in the ordinary course of business, and is free from donative intent. Second, the claim is not related to an expectation or claim of inheritance. Third, the claim originates pursuant to an agreement between the decedent and the family member. Fourth, performance by the claimant stems from an agreement between the decedent and the family member. Finally, all amounts paid in satisfaction or settlement of a claim or expense are reported by each party for Federal income and employment tax purposes in a manner that is consistent with the reported nature of the claim or expense, that is, the deducted expense is reported as income by the recipient. None of these tests were met, according to the appellate court. Notably, the stepchildren did not report their inheritances as income [Estate of Spizzirri v.Commissioner, 136 F.4th 1336 (11th Cir. 2025)].

(April 2026)
© 2026 M.A. Co. All rights reserved.

The IRS has reported that as of March 31 more than 4 million taxpayers have signed up for tax-favored Trump Accounts [IR-2026-42]. More than 1 million are covered by elections for the $1,000 pilot program contribution from the federal government. Form 4547 is used to create the account, available at the IRS website [https://www.irs.gov/pub/irs-pdf/f4547.pdf].

A Trump Account is a new version of an Individual Retirement Account (IRA) specifically for kids that does not require earned income for contributions. Up to $5,000 may be contributed each year through age 17, and at age 18 the account becomes a traditional IRA, subject to traditional IRA limits on withdrawals. As such, the account is of limited utility in meeting college education costs, it is primarily oriented toward retirement.

Financial planners have come up with an interesting twist. After the Trump Account becomes a traditional IRA, the beneficiary could convert it to a Roth IRA. The conversion amount would be taxable income, but if this happens early in the beneficiary's career, perhaps spread over several years, the income tax hit would be relatively slight. The Roth IRA would then grow tax free until retirement, when it could provide for tax-free withdrawals free of the Required Minimum Distributions (RMDs) that apply to traditional IRAs. According to an illustration in The Wall Street Journal, assuming a modest 7% annual growth rate and assuming that the income tax on the conversion to a Roth IRA is paid from other sources, the Trump Account will be worth just over $3 million when the beneficiary reaches age 59 1/2. Of course, that day is very far in the future, and the tax rules might change in the meantime.

Contributions to the Trump Accounts may begin on July 4, 2026.

(April 2026)

© 2026 M.A. Co. All rights reserved.

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Because of the rapidly changing nature of tax, legal or accounting rules and our reliance on outside sources, Garden State Trust Company makes no warranty or guarantee of the accuracy or reliability of information contained herein nor do we take responsibility for any decision made or action taken by you in reliance upon information provided here or at other sites to which we link. ©2026. All rights reserved.