DGAA bLAWg

Homestead Rights in Illinois

Web Admin - Thursday, October 23, 2014

homestead rights in Illinois, Palatine estate planning lawyerWhile there are many well known government programs and policies designed to provide relief during difficult economic times, there are other laws people can take advantage of that are less commonly talked about. One of these laws is known as “homestead rights.” Homestead rights are a protection provided by Illinois law that provide certain immunities from debt collection efforts by creditors. However, these immunities are not absolute, so it is important for people exercising their homestead rights to understand the exact limitations of those rights.

What Homestead Rights Are

Homestead rights are a statutory protection against creditors designed to help people avoid becoming homeless because of changing economic circumstances. The rights allow the debtor to exempt $15,000 worth of real estate from the collection efforts of creditors or their agents. Additionally, if a married couple owns the home, then they can pool their homestead rights together to protect the same house. This gives them an exemption of $30,000. This exemption also survives the death or desertion of a spouse. The exemption can also be passed down to the children of the married couple, at least until the youngest child turns 18.

Illinois' homestead laws are also slightly different than the laws in some other states. Many states choose to restrict the amount of acreage that a person can use the homestead exemption on in addition to capping the total value of the property. Illinois has no such acreage cap. This means that the size of the property is irrelevant to the homestead rights, and that it is purely an issue of how much the land is worth.

What Homestead Rights Do Not Protect

Notably, homestead rights do not provide absolute protection against every type of creditor. For instance, the state legislature wrote an exception into the protection for the purposes of state taxes, so if the creditor is the state of Illinois then the exemption does not apply. Similarly, homestead rights are created by state law, which federal law can supersede, so they provide no protection against the federal government's collecting taxes either. The rights also do not function in many circumstances where the money owed is related to the property itself. A person who uses the house as collateral for a mortgage does not get protection if their home is being foreclosed. Additionally, if the person owes money to contractors for doing work on the home, then the homestead rights do not apply to those debts. Further, the homestead rights can be signed away in writing, which would also remove their protection.

If you have questions about your homestead rights or some other property interest, talk to an experienced Palatine, Illinois estate planning attorney today. Our firm helps clients in many northwest suburban towns including Barrington, Long Grove, and Arlington Heights.

About the Author: Attorney Jay Andrew is a founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/ commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.

Trust Payments and the Capital Gains Tax

Web Admin - Wednesday, August 27, 2014

capital gains tax in IllinoisThe capital gains tax exists as a way for the government to tax the income that flows to investors from certain investments. In general, the capital gains tax applies to the sale of most assets other than inventory. This includes the sale of things like stocks, bonds, and real estate. The current capital gains tax rates vary depending on a person's income bracket. According to the IRS, the capital gains tax for people in the 25 percent, 28, percent, 33 percent, and 35 percent income tax brackets would be 15 percent.

People paying taxes in the highest bracket, 39.6 percent, would pay 20 percent in capital gains tax, and people in the other, lower tax brackets do not pay capital gains tax at all for most capital gains income. Additionally, the Affordable Care Act also introduced a further 3.8 percent tax on capital gains income for people earning either $200,000 a year as single filers, or $250,000 a year as married filers, which went into effect at the start of 2013.

This capital gains tax can interact with trusts in complex ways, and trustees should be aware of the issues created by the capital gains tax and trusts. First, trustees should be aware of how capital gains affects the way that they manage K-1 tax forms. Second, trustees should keep in mind the interaction between capital gains and the income distribution tax deduction that trusts are allowed to take.

K-1 Forms

K-1 forms are a type of tax form that exists to help the owners of pass through entities fill out their personal income tax returns. Pass through entities are entities like S corporations and some LLCs that do not pay taxes themselves, but instead pass the taxes on to the owners. Trusts, strictly speaking, are not actually pass through entities since the trust is responsible for paying some taxes, but the beneficiaries may also owe taxes based on distributions to them from the trust, so they often receive a K-1 form. As far as the need to report capital gains income on a K-1 form, that depends on the specifics of the trust. As a default rule, the capital gains and losses stay with the trust itself, but the trust instrument may choose to pass those along to the beneficiaries, which would result in the trustee needing to add them to the K-1 form.

Capital Gains and the Income Distribution Deduction

Capital gains may also have an effect on the trust's income distribution deduction, a tax deduction that trusts may take for amounts paid to an income beneficiary. The income distribution deduction is equal to the lesser of either (1) the distributions minus tax-exempt income or (2) the “distributable net income” minus tax exempt income. Capital gains may affect this distribution because it figures into the calculation of distributable net income under several circumstances, most commonly if the trust requires the trustee to distribute the gains to the beneficiaries.

Managing a trust is a complex task from both a legal and financial perspective. If you have questions, seek help from an experienced Illinois estate planning attorney. Our firm's skilled lawyers serve clients in many northwest suburban towns such as Inverness, Barrington, and Kenilworth.

About the Author: Attorney Jay Andrew is a founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/ commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.


Recent Posts


Tags

Exclusions Palatine traffic lawyer Forcible Entry Illinois wills and trusts Chicago attorney Palatine corporate attorney traffic offenses estate tax medical research Illinois employment attorneys Illinois traffic attorney wrongful death Chicago insurance claim attorneys Des Plaines civil attorney estate plan Illinois DUI attorney rumble strips Rolling Meadows life insurance claim denial attorney denial of life insurance new real estate form cause-of-death exclusions wrongful termination Illinois workers compensation attorney Des Plaines drug lawyer Des Plaines claims law firm surgical mistakes Rolling Meadows personal injury lawyer Crystal Lake insurance lawyer subcontractor Barrington employment law firm texting and driving Illinois traffic laws Rolling Meadows insurance dispute lawyers, insurance dispute back injuries liens elder abuse Illinois employment law firm material misrepresentation construction contracts traffic deaths drug crimes lawyer Buffalo Grove traffic lawyers Schaumburg traffic lawyer Crystal Lake injury attorney Des Plaines personal injury attorney liability estate planning attorney Detainer Actions Deer Park DUI lawyer auto accidents Chicago life insurance attorney Arlington Heights Attorney liability claims Long Grove wills and trusts attorneys loopholes Deer Park traffic lawyer pet law Rolling Meadows boating crash lawyer fiduciary rule Illinois estate planning Illinois will lawyer Rolling Meadows insurance dispute lawyers product liability Barrington life insurance lawyer breach of contract college kids vacation home fines Illinois estate planning law firm Inverness traffic law firm Illinois Wage Payment and Collection Act insurance claim dispute Crystal Lake personal injury attorney Long Grove estate planning attorney insurance agents Colin Gilbert Mount Prospect real estate lawyer car accident lawyers Des Plaines DUI attorney Long Grove estate planning Des Plaines medical malpractice attorney car collision Crystal Lake traffic lawyer Transfer on Death Instrument foreclosed rental property insurance attorney Home Remodeling Repair Act murder Palatine drug lawyer real estate zoning Legal Info personal injury estate planning trusts Illinois lawyer Illinois insurance claim attorney child safety jet ski accidents Crystal lake insurance dispute attorney probate lawyer Mount Prospect wills and trusts lawyers Palatine personal injury lawyer top life insurance claim denials vacation home Des Plaines criminal attorney uninsured motorist car crashes holiday statistics Arlington Heights Traffic Lawyer special needs trust insurance claims civil litigation attorney Des Plaines injury law firm Arlington Heights pedestrian accidents BUI Illinois LLC creation medical malpractice compensation Rolling Meadows insurance attorney Deer Park employment law attorney premises liability Illinois job attorney Illinois mortgages traffic laws DMV marijuana Crystal Lake personal injury lawyer wills Class A misdemeanor Arlington Heights personal injury lawyer home inspection lawyer Schaumburg estate attorney Crystal Lake bike accident lawyer mass shooting deadly crashes Barrington attorney texting while driving underage DUI Retaliatory Discharge digital evidence School Visitation Rights Act Illinois motorcycle accident lawyer Des Plaines tax law firm insurance denial appeals Schaumburg construction accident lawyer insurance dispute attorney Illinois insurance disputes Illinois workplace lawyer Palatine punch death license Barrington injury attorney Arlington Heights medical malpractice lawyer breathalyzer test landlord tenant law residential real estate Barrington estate planning lawyer medication errors boating under the influence real estate leasing Illinois employment law driving overtime pay privacy Rolling Meadows Buffalo Grove car accident lawyer revenge porn Deer Park motorcycle accident lawyer Illinois injury lawyer Crystal Lake car accident attorney blood alcohol content filing a medical malpractice claim Schaumburg life insurance attorney Illinois real estate Schaumburg corporate attorney hands free device trusts comp time underfunded trust Illinois Human Rights Act workers compensation benefits dram shop law real estate closing Jay Andrew Illinois living will life insurance lawyer Rolling Meadows traffic attorney employment law, Illinois employment laws Illinois probate lawyer deed transfer DUI Affordable Care Act Illinois boating accident lawyer cell phone accidents Whistleblower Claims Des Plaines motorcycle accident attorney trustee ACA Rolling Meadows personal injury lawyers IRELA Palatine Attorney Illinois personal injury personal injury attorney nursing home negligence trucking accidents Palatine corporate law attorneys paid sick leave Rolling Meadows estate planning attorney bad faith insurance claims fault based insurance Chicago employment attorney digital assets Illinois speeding lawyer Fair Labor Standards Act Rolling Meadows drug defense attorney drunk driving Arlington Heights wills and trusts attorney sexual images right to work denied insurance claims beneficiary complications bike accident rest breaks Palatine employment lawyer Des Plaines real estate lawyer condo association capital gains tax sexual harassment pedestrian accidents Arlington Heights personal injury attorney Crystal Lake pedestrian accident lawyer Illinois trucking safety Illinois medical malpractice case federal crimes agent Illinois Smoke Detector Act Palatine civil attorney Buffalo Grove real estate attorney Palatine traffic accidents elder law Barrington criminal defense lawyer Des Plaines Arlington Heights car accident lawyer insurance claim Barrington estate planning attorney car crash murder charges Chicago car accident lawyer Illinois Sales Representative Act fatal car accidents Illinois jet ski accident lawyer Schaumburg civil litigation attorney cell phone Arlington Heights tax lawyer Illinois employment laws insurance disputes criminal law Rolling Meadows Attorney medical malpractice claims Buffalo Grove corporate attorney Illinois Transfer on Death Instrument advance healthcare directive rollover car crashes preventable medical errors icy parking lots Thanksgiving Barrington personal injury lawyer commercial real estate real estate attorneys personal injury accidents Federal Food Drug and Cosmetic Act Rolling Meadows accident lawyer employment law, meal breaks, rest breaks, hotel employees, Des Plaines employment law attorneys Illinois medical malpractice claim insurance claim dispute attorney Illinois estate planning attorney DUI penalities disability benefits jet ski Inverness DUI lawyer drunk driving statistics Illinois red light cameras owner responsibility Barrington employment law attorney unfunded trust Illinois pedestrian accident attorney accidental death benefits dog bites insurance claim delay Palatine trusts lawyer swimming pools car accidents automated cars Illinois attorney trauma after an accident Fourth of July Illinois insurance dispute lawyers Buffalo Grove criminal defense lawyer medical malpractice wage theft homestead rights how to avoid common denials of life insurance claims digital assets, digital fiduciary, estate planning, digital content, Long Grove estate planning lawyers traumatic brain injury llinois Real Estate Lawyers Association income distribution deducation IRS Illinois employment law attorneys Schaumburg wrongful death attorney privacy laws Illinois employment law attorney workers compensation eluding a police officer car crash injuries Crystal Lake employment lawyer insufficient documentation comparative negligence Crystal Lake medical malpractice law firm license revocation Illinois Palatine insurance lawyer business litigation real estate contract defective products lawyer BAIID commercial leasing life insurance claims operating agreements Riverwoods estate planning lawyer slip and fall Crystal Lake car accident lawyer rent to own real estate contracts hiring employees head on collisions criminal record Attorney Ken Apicella Rolling Meadows DUI lawyer Inverness civil lawyer Schaumburg probate attorney Arlington Heights estate planning attorney Schaumburg injury lawyer Des Plaines collections attorney employment contract Schaumburg estate planning lawyer DGAA Buffalo Grove personal injury lawyer expungement Buffalo Grove insurance claim dispute lawyers Barrington real estate lawyer Palatine criminal defense lawyer probate Schaumburg car accident attorney civil litigation Illinois bicycle safety social media after death Schaumburg personal injury lawyers Illinois tax attorney boating DUI taxes employment law Long Grove real estate attorney Deer Park personal injury lawyer Kenilworth estate planning lawyer living trust personal injury lawyer Illinois wrongful termination lawyer marijuana crimes attorney Illinois insurance attorney Arlington Heights insurance attorney investment property Barrington personal injury attorney Barrington workers compensation attorney modern family estate planning Rolling Meadows traffic law firm LLCs real estate attorney employees Policy Cancellation denial of insurance claim Illinois collections attorney healthcare Crystal Lake law firm Deer Park medical malpractice attorney installment contracts Illinois construction accident attorney motorcycle accident compensatory time loss of consortium Deer Park workers compensation lawyer field sobriety test employee rights Illinois medical malpractice attorney Illinois wills and trusts attorneys Illinois business law atorneys Palatine construction attorney Rolling Meadows litigation lawyer Rolling Meadows car accident lawyers Illinois criminal defense attorney Deer Park criminal attorney Inverness estate planning lawyer overtime violations power of attorney Schaumburg employment law attorneys Colin H. Gilbert insurance claim denial workers comp Barrington boating accident attorney contracts Des Plaines personal injury lawyers pain and suffering Barrington medical malpractice lawyers Schaumburg Crystal Lake tax lawyer meal breaks low-ball insurance settlement Super Mario Palatine civil litigation lawyer Arlington Heights employment law attorneys appealing an insurance claim insurance denials estate planning for college students manufacturing suspended license Rolling Meadows real estate attorney Schaumburg criminal law attorney Des Plaines personal injury lawyer Barrington drug crime attorney Chicago lawyer traffic violations defense Illinois insurance claim dispute lawyers insurance disputes, Illinois insurance disputes, Illinois insurance dispute attorneys, denied insurance claims, Arlington Heights insurance dispute attorneys Crystal Lake medical malpractice lawyer drug crimes irrevocable trust Inverness real estate attorney Long Grove real estate lawyer insurance dispute creditors Buffalo Grove life insurance attorney Crystal Lake civil litigation lawyer independent contractor controlled substance CAM estate planning, digital assets, Revised Uniform Fiduciary Access to Digital Assets Act, Illinois digital assets, Illinois estate planning, employment attorney mortgage Chicago corporate attorney Illinois business lawyer Rolling Meadows business lawyer Rolling Meadows employment attorney Inverness injury lawyer condo Chicago insurance law firm unpaid overtime Food and Drug Administration's Food Safety Modernization Act trench injuries Arlington Heights wills and trusts lawyers institutional trustee Arlington Heights wills and trusts lawyer Crystal Lake will lawyer Palatine business attorney personal injury claim food poisoning Mt Prospect Attorney Illinois car accident attorney Chicago estate planning Barrington Illinois estate planning lawyer Illinois real estate lawyer pregnant women Buffalo Grove employment lawyer motorcycle accident lawyer Schaumburg drug defense lawyer pizza emoji Barrington litigation attorney traumatic brain injuries involuntary manslaughter Deer Park real estate law firm life insurance policy bicycle dooring accidents Palatine employment attorney coronavirus Inverness corporate attorney Do Not Resuscitate Arlington Heights wills and trusts attorneys Kenilworth estate planning attorney spinal cord injuries blended families IRA trust transfer Chicago traffic lawyer employee misclassification Illinois traffic attorneys Arlington Heights employment attorney Illinois workplace discrimination attorney caretaker rights Palatine injury attorney insurance dispute, insurance dispute lawyers, insurance claim denial, insurance claim delays, Rolling Meadows insurance dispute attorneys car accident Illinois personal injury attorney construction accidents, personal injury, wrongful death, Arlington Heights personal injury attorneys, workers' compensation Arlington Heights trucking lawyer commercial leases Chicago estate planning lawyer Employment Discrimination Law Illinois defective products attorney Rolling Meadows personal injury attorney denied insurance claim startup company Illinois traffic accident lawyer POA Barrington employment attorney living trust vs will Barrington Traffic Lawyer license suspension distracted driving accidents Chicago trucking accident attorney Illinois insurance claim dispute lawyer Illinois Workers’ Compensation Commission Illinois elder law attorney Illinois corporate lawyer Palatine employment law lawyer drugs Arlington Heights real estate lawyer fiduciary rule delay Deer Park accident attorney Schaumburg real estate lawyer Schaumburg personal injury lawyer Illinois rollover accident lawyers Inverness accident lawyer Chicago will attorney, social media platforms, Illinois estate planning lawyer, Arlington Heights lawyer truck collisions cell phone tower data unpaid assessment Schaumburg insurance lawyers whistleblower protections most common reasons for life insurance claim denials BAC pedestrian accident Schaumburg medical malpractice lawyer pet bites medical malpractice, missed diagnosis, delayed diagnosis, medical mistake, Deer Creek medical malpractice lawyers Illinois home inspection gift taxes bicycle accidents life insurance claim denial, denial of life insurance claim trucking accident lawyers pedestrian-automobile accident Illinois workers compensation lawyer natural gas spinal cord injury estate attorney living trust benefits Illinois personal injury lawyers Barrington civil litigation attorney tax attorney Arlington Heights accident attorney Inverness real estate lawyer Illinois insurance claims lawyers Palatine probate lawyer real estate lawyer Rolling Meadows criminal lawyer insurance adjusters DNR Chicago will attorney Inverness elder law lawyer Crystal Lake business law attorneys estate planning, death tax, succession plans, business estate plans, Barrington estate planning lawyers Arlington Heights injury attorney Rolling Meadows employment law attorney Barrington business law firm Mount Prospect elder law attorney IRA benefits Des Plaines pet law attorney clemency in terrorem provision ObamaCare Family Medical Leave Act insurance agent negligence rollover accidents Crystal Lake criminal defense attorney Crystal Lake traffic attorney Des Plaines accident attorney no contest clauses Arlington Heights TBI attorney license reinstatement Buffalo Grove probate lawyer slip and fall accidents Des Plaines insurance attorney Des Plaines drug crimes lawyer insurance claim denials traffic accidents Des Plaines Traffic Lawyer estate planning Rolling Meadows probate lawyer dynasty trusts Illinois Probate Act of 1975 Illinois civil litigation lawyer probate claims probate process brain injury Buffalo Grove injury lawyer ken apicella Illinois traffic ticket lawyer Rolling Meadows corporate lawyer crossover accidents life insurance forming a corporation in Illinois severance agreements criminal Illinois Trust Code traffic violations Palatine real estate lawyer reckless homicide first degree murder Schaumburg employment attorney Long Grove estate planning attorneys DUI defense wrongful termination, employment law, whistleblower protections, Illinois employment laws, discrimination in the workplace Des Plaines real estate attorney digital information Illinois medical malpractice lawyers pedestrian injuries, pedestrian fatality products liability employment lawyer Illinois registered agent power of attorney for healthcare Chicago employment lawyer minimum wage Palatine law firm speeding Liquor Control Act distracted driving accident victims Chicago biking tips Illinois driving without license caregiver Buffalo Grove traffic attorney digital media accounts, estate planning, Arlington Heights estate planning attorney, Self-Directed IRA Accounts construction accidents underinsured motorist consent to a search Rolling Meadows tax attorney personal injury, auto accident injuries, delayed injuries, serious injuries, Des Plaines personal injury attorneys car accident lawyer Barrington criminal lawyer insurance negligence golf accidents Illinois employee rights attorney. Illinois employment lawyer Palatine life insurance lawyer Palatine estate planning lawyer Kenilworth estate planning attorneys gift tax exemption, estate planning, estate planning strategies, Illinois estate planning, South Barrington estate planning attorneys medical marijuana Inverness insurance attorney attorney fees Illinois trusts attorney senior citizens health insurance dispute Schaumburg elder law lawyer Crystal Lake medical malpractice attorneys Buffalo Grove personal injury attorney trust payments Illinois personal injury lawyer Crystal Lake estate planning lawyer South Barrington real estate attorney Illinois pet lawyer Crystal Lake employment law attorney drug possession Schaumburg criminal attorney Inverness probate lawyer work unions Arlington Heights car crash attorneys guardianship attorney Schaumburg personal injury attorney dealing with problem employees Rolling Meadows employment law attorneys Crystal Lake accident attorney South Barrington real estate lawyer traffic tickets wills and trusts probate claims process landlord internet FSLA small business Joliet general practice lawyers TBI preventing accidents Palatine workers compensation lawyer Arlington Heights traffic attorney Crystal Lake employment attorney estate planning lawyer job lawyers personal injury law firm Illinois insurance lawyer Palatine elder law attorney murder defense financial advisors unauthorized overtime civil rights violation changes to mortgage law Landlord Tenant Ordinance Home Sale Contingencies Schaumburg Attorney defective products anesthesia errors Deer Park traffic accident attorney Rolling Meadows criminal attorney Illinois small business Buffalo Grove law firm Arlington Heights criminal lawyer personal injury claims Buffalo Grove medical malpractice lawyers Inverness personal injury attorney Rolling Meadows insurance lawyer Schaumburg estate planning attorney problem employees corporate law foreclosure living wills pay when paid contract Crystal Lake pet attorney Rolling Meadows marijuana attorney real estate workplace sexual harassment sole proprietorship Illinois law healthcare claims drug crime FMLA DUI attorney natural gas explosion criminal defense GM ignition switches employee discrimination PTSD boating accidents employment contract, employment law, employment at-will, Deer Park employment law attorneys, contract, probate fees federal regulations for LLCs traffic crimes Rolling Meadows Traffic Lawyer hit and run accident lapse in policy Rolling Meadows medical malpractice lawyers

Archive