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Funerals for the rich

A crypt beneath New York’s Basilica of St. Patrick’s Old Cathedral is available for $7 million. This isn’t just any crypt, It’s one of the last full-body burial spots in Manhattan and can hold nine caskets and 10 cremated remains. And at least three prominent NYC families have already inquired about it.

Today, funerals are becoming the way for the rich to flaunt their wealth. Along with lavish weddings and over-the-top birthday parties,  funerals have become a way for the rich to flaunt their wealth one last time.

William Villanova, general manager of Frank E. Campbell Funeral Chapel, New York’s “undertaker to the stars.” told “Accounting Today, “Whatever we can do that is legal, lawful and in keeping with the integrity of our profession, we will do.”

CEO Nigel Lymn Rose of the U.K.-based A.W. Lymn funeral home said, custom-made Rolls-Royce Phantom VII hearses and a fleet of 25 matching Rolls-Royce sedans are sought-after internationally.

He also told Accounting Today, “I get inquiries from people who have always driven Rolls-Royce’s and want their final journey to be in a Rolls-Royce.  They “want to make a statement: Ride it in life, ride it in death.”

Accounting Today also told of  the recent funeral of a fashion designer they did not name, where they assembled 120 gospel singers who performed as the casket was carried from the hall. A marching band performed at one service, and Lincoln Center’s Alice Tully Hall was covered in blue hydrangeas to mirror the deceased’s Hamptons home.

Businessmen and billionaires are often aggressively competitive in life “and that doesn’t end when they think they’re going to die,” said Ted Klontz, a Nashville, Tennessee-based financial psychologist.

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Avoid estate planning mistakes like Aretha

Aretha Franklin may have been the Queen of Soul, but she made gigantic estate planning mistakes that you should avoid. Franklin, who was divorced, died without a will or a trust despite having four grown children, one of whom has special needs.

If you follow in her footsteps could mean your loved ones won’t receive the inheritance you intended; disbursements could be long-delayed; ugly family squabbles may ensue; and your estate might owe additional taxes and your financial life will become a public record. If you have a special needs child, he or she may wind up losing some government benefits.

Many Americans don’t have a will or a living trust. A 2017 survey by Caring.com found that only 4 in 10 adults do. The study noted 64 percent of Gen Xers and 42 percent of boomers don’t have a will. The top reason for not taking these easy estate-planning steps, according to survey respondents: they “hadn’t gotten around to it.”

Chances are you don’t have anywhere near Franklin’s reported $80 million. But the actual dollar value isn’t the point. It’s about making sure your loved ones receive what you want the way you want them to.

If you don’t have a will, your estate will wind up in probate court, which means it will become public for anyone to see.

In Franklin’s case, the feds will take a big bite, too. There’s a 40 percent estate tax on an estate’s assets over $11.18 million (the exception to this: money or assets left to charity). If Franklin’s estate truly is worth $80 million, the Internal Revenue Service will snag $27.5 million of that.

Get a will for Pete’s sake. You can do it online but your better off having a real attorney to make sure it is totally legal. If you don’t have a will, your estate will wind up in probate court, which means it will become public for anyone to see and create hassles for your loved ones.



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Aretha Franklin left no estate plan or will

Queen of Soul, Aretha Franklin left no will or any estate plan which could open heirs to high estate taxes an create legal squabbles. Her four sons have filed a document listing themselves as interested parties for her estate.

Her niece has requested the court to appoint her as executor of the estate which has been estimated $80 million.

Franklin’s long-time attorney told the Detroit Free Press that he bugged her for years to set up a trust but she never did.

The lack of a trust or will could lead to hassles for her potential heirs. Jeffrey Eisen, a trusts and estates attorney with the law firm Mitchell Silberberg & Knupp in Los Angeles has represented potential heirs  in a number of contested or disputed estates. Many of those clients are prominent individuals and estates in the entertainment industry, including Muhammad Ali and Farrah Fawcett. He sees trouble ahead. He told Accounting Today:

 “It means that the State of Michigan is going to write her will for her because she didn’t have one, It means that she didn’t get to choose who would be in charge of her estate, including being in control of her music catalog. That’s going to be determined by the heirs, assuming they can agree. And it means that everything is going to be played out in public view, including the valuation of her assets, her music catalog — everything. It’s completely and totally public and all avoidable.”

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Medicare being hit by fraud

Medicare is in danger. Each year, roughly 10 cents of every dollar budgeted for Medicare program is stolen or misdirected before it helps anybody. Looked at another way, about $1,000 is lost per Medicare member through theft or waste each year. That is according to the federal government. But it could be far worse. Harvard University professor, Malcolm Sparrow, a leading expert on health care fraud, says the true amount lost to fraud, abuse or improper payments could be 20 percent, or even as high as 30 percent.

Sparrow said, “The fact of the matter is, we don’t know how much is lost, We ought to know. We shouldn’t have to guess. But the truth would be hard to swallow.”

It’s not just taxpayers who pay. Medicare beneficiaries also foot the bill in the form of higher deductibles and co-payments and cuts to services and care. Simply, fraud is directly harming the health of older Americans and compromising the program.

“The real damage is the winding down and gutting of services,” Sparrow says. “And it’s been happening for a long time.” Quite often the fraudsters:

  • Charge for services never delivered
  • Falsify records
  • Inflate claims
  • Steal your ID
  • File duplicate claims
  • Provide unneeded equipment
  • Buy off doctors/patients

Every recent president has acknowledged the problem, but the crooks continue to target the program, and new schemes spread across the country faster than officials can keep up. Why does Medicare continue to be a choice target for fraud? Critics say the problem is built into the system. Private health care programs investigate suspicious claims before paying them, but Medicare pays claims first and investigates later. Among insiders, that’s referred to as “pay and chase.” That’s changing, but progress is at a turtle’s pace.

The senior advocacy organization, AARP contacted the administrator of the Centers for Medicare and Medicaid Services, but did not get a response to any questions.

Kirk Ogrosky, a former federal prosecutor who fought Medicare fraud, says the bilking of Medicare should concern everyone, even those who are not yet old enough to take advantage of the program, because they pay for it through their taxes.

Ogrosky said, “Every American should be angry about it.  If there is massive fraud, people should know that their benefits are going to be hit.” He Ogrosky believes the solution is more funding to stop fraud before it happens, instead of sending in federal agents later.

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Student debt solution? Allow bankruptcy

One of the great financial burdens today is student debt. Gigantic tuition hikes over the last few decades have saddled college graduates with insurmountable debt that can’t be relieved by bankruptcy.

In 1978, the bankruptcy laws were overhauled and the ability to discharge studennt loans was taken away. The reasoning was tuitions were much lower and there was a robust job market and most graduates had no problems getting jobs.

Fast forward 30 year and tuitions have skyrocketed and graduates have no avenue to climb out from under the debt even if they are gainfully employed.

The ability to declare bankruptcy as a last resort has long been a vital element of American society yet that is denied to young people who need to borrow for their education.

Back when the law was changed, student loan defaults were not an issue. Now due to the high cost of college, defaults are common and a change in the law is needed.

Last year U.S. News and World Report released study saying total student debt now tops $1.3 trillion. It’s the single fastest-growing segment of U.S. consumer debt, increasing by 170 percent over the past ten years. 44 million Americans currently have student debt, and 8 million of those have already defaulted on their loans.

We define that as a crisis.


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