Close

Tax, Trusts & Estates

The Cole Schotz Tax, Trusts & Estates attorneys counsel individuals and businesses in a range of tax and estate planning strategies.  Our clients include owners of family businesses where succession planning and asset protection are linked, and individuals of substantial means who wish to take advantage of sophisticated tax planning techniques to retain and build their wealth for future generations.

+ READ MORE

Tax, Trusts & Estates Representative Matters

We succeeded in substantiating, in IRS proceedings, the transfer of approximately $6 million of assets out of a client’s taxable estate shortly before the client’s death with no transfer tax consequences. The taxpayer funded a limited partnership with $10 million of assets and then sold a 50% limited partnership interest to her children in exchange for a private annuity, transferred approximately 10% to a charitable lead trust and transferred small percentage interests to the taxpayer’s children and grandchildren. These strategies saved the family approximately $3 million in estate taxes.

A New Jersey Tax Court judge ruled that the State of New Jersey is obligated to act with integrity and comply with its deliberate representations that lottery winnings were not subject to income tax, therefore barring them from taxing annuity payments of our client’s $46 million lottery winnings.

On June 9, 2000, our client, Melvin Milligan won the top prize in the Big Game Drawing totaling approximately $46 million. When Mr. Milligan won and claimed his New Jersey Lottery prize, winnings from the New Jersey Lottery were specifically excluded by statute from taxable income under the New Jersey Gross Income Tax Act, N.J.S.A. § 54A:l-l, et seq. After consulting with counsel, and in reliance on the State tax laws in existence at that time, Mr. Milligan opted to receive his prize in 26 annual installments of approximately $1,769,000 each.

Mr. Milligan received the agreed-upon installments without issue until 2009, when the State of New Jersey amended the law to subject New Jersey Lottery winnings over $10,000 to the New Jersey Gross Income Tax. This amendment was enacted on June 29, 2009, but made effective retroactively as of January 1, 2009. As a result, beginning tax period 2009, and every year thereafter, Mr. Milligan and his wife, Kimberly-Lawton Milligan, began reporting the New Jersey Lottery winnings as income and paying the applicable tax in excess of $133,000 each year. The Milligans disputed New Jersey’s right to collect income tax on their prize money – a prize won over nine years before the change in the law – and filed a lawsuit against the State of New Jersey, Division of Taxation and State of New Jersey, Division of Lottery. The Milligans alleged breach of contract, violations of both the United States Constitution and New Jersey State Constitution, violations of the common-law “manifest injustice” and “square corners” doctrines, and sought reversal of their denied refund claims.

On September 26, 2016, the Honorable Judge DeAlmeida granted the Milligans partial summary judgment based on the square corners doctrine which states, in essence, that in dealing with the public the government must act with integrity and “turn square corners”. Reversing the final determinations of the Division of Taxation, the Court concluded that the State is prohibited from imposing gross income tax on the Milligan’s winnings from a 2000 New Jersey lottery prize received in installments in 2009 and later years. The Court further explained that although the 2009 amendment allows for gross income taxes on lottery prizes, the retroactive extension of state income tax to our client’s winnings is barred by such doctrine because it is indisputable that in 2000 state lottery officials actively and intentionally represented to the public that winnings were not subject to New Jersey gross income tax. These representations “became part of the contractual agreement” between the State and Milligan, who elected to receive his winnings in installments over a 26 year period with the understanding that the payments would not be subject to income tax.

In addition to the Milligans, this firm represents over two dozen other plaintiffs who are similarly challenging the State’s retroactive taxation on their lottery winnings. The Court’s ruling in Milligan applies across the board to our other clients.


Cole Schotz has published a book titled On the Road to Florida: Cole Schotz's Practical Guide to Changing Your Residence from New Jersey or New York. Authored by the attorneys in the Tax, Trusts and Estates Department, and edited by Gary A . Phillips, the book serves as a guide to saving significant tax dollars by moving from New Jersey or New York and establishing residency in Florida. If you are interested in receiving a complimentary copy, please send an email including your mailing address to jpoot@coleschotz.com.
Foreign Parents With U.S. Children: Trusts Play an Important Role

The Legal Intelligencer February 14, 2017

The Repeal of the New Jersey Estate Tax: Is it Now Safe to Move Back to New Jersey?

Tax, Trusts & Estates Law October 19, 2016

May 2016 Newsletter

Cole Schotz News May 2016

April 2016 Newsletter

Cole Schotz News April 2016

Uncertainty Remains Surrounding the Nonprofit Hospital Tax Exemption

Real Estate & Construction Law Monitor January 21, 2016

Mary Browning published a chapter titled, "Family and Business Succession Planning Remains Imperative, Despite New Tax Exemptions"

Inside the Minds: Family and Business Succession Planning 2016 Edition

The Importance of Special Purpose Trusts in Estate Planning

New Jersey Law Journal December 17, 2015

Receiving a Deduction for Your Charitable Contribution on Giving Tuesday

Tax, Trusts & Estates Law Monitor December 1, 2015

IRS Proposed Regs Redefine the Terms Husband and Wife

Tax, Trusts & Estates Law Monitor November 13, 2015

2015/2016 Estate and Gift Tax Update

Tax, Trusts & Estates Law Monitor September 28, 2015

Family Limited Partnerships: Are Discounts Disappearing?

Tax, Trusts & Estates Law Monitor July 14, 2015

The ABLE Act

New Jersey Law for Special Needs Children July 14, 2015

Defending Against a Motion to Dismiss New Jersey State Lottery Claims

Tax, Trusts & Estates Law Monitor March 4, 2015

Toward a Better Buy-Sell Agreement

New Jersey Law Journal Business succession planning: Encourage your clients to get it done February 5, 2015

Florida Becomes the 36th State to Allow Same-Sex Marriage

Tax, Trusts & Estates Law Monitor January 9, 2015

President Obama Signs Into Law Tax Extenders and ABLE Act

Tax, Trusts & Estates Law Monitor December 19, 2014

Extension of 2014 Qualified Charitable Distributions

Tax, Trusts & Estates Law Monitor December 4, 2014

2015 Estate And Gift Tax Update

Tax, Trusts & Estates Law Monitor October 31, 2014

The Importance of Selecting the Best Fiduciary

New Jersey Law Journal July 24, 2014

Banking Institutions and Powers of Attorney

Elder Law Perspectives July 10, 2014

School Segregation of Special Needs Students

New Jersey Law for Special Needs Children July 3, 2014

Higher Exemption Amount Does Not Eliminate Need for Creative Estate Strategies

Aspatore Books Inside the Minds: Family and Business Succession Planning, 2014 ed.

How Pre-Death Probate Can Protect An Estate Plan

Private Wealth February 26, 2014

Analyzing the Power to Tax Internet Sales

New York Law Journal February 24, 2014

2014 Estate And Gift Tax Update

Tax, Trusts & Estates Law Monitor January 8, 2014

New Jersey Supreme Court Rules on Special Needs Trusts and Child Support Payments

New Jersey Law for Special Needs Children August 22, 2013

Mandatory Electronic Filing for FBARs Effective July 1, 2013.

Tax, Trusts & Estates Law Monitor June 25, 2013

Estate Administration In A Paperless World

Tax, Trusts & Estates Law Monitor June 4, 2013

2013 Estate Planning - Still Not The Time To Be Complacent

Tax, Trusts & Estates Law Monitor May 13, 2013

Who is a Large Employer Under Obamacare?

Employment Law Monitor May 9, 2013

New Jersey Estate Litigation: The Availability of Punitive Damages

Tax, Trusts & Estates Law Monitor March 5th, 2013

New Jersey Judiciary Asking for Volunteers to Oversee Guardians

New Jersey Law for Special Needs Children February 14th, 2013

After the Fiscal Cliff — A Summary of the New Federal Gift and Estate Tax Law

Tax, Trusts & Estates Law Monitor January 10th, 2013

Addressing and Understanding Client Goals, Motivations, and Concerns to Create Successful, Individualized Trust and Estate Plans

Aspatore Books Inside the Mind: Bests Practices for Structuring Trusts and Estates, 2013 ed.

The Clock Is Ticking on Rare Tax Planning Opportunities

New York Law Journal January 30, 2012

Storing Gold Offshore: What Your Clients Need To Know

New Jersey Law Journal October 17, 2011

Divorce Requires an Affirmative Review of an Estate Plan

New York Law Journal August 1, 2011

Estate Planning for Families with Special Needs Children

New Jersey Law Journal February 21, 2011

Best Practices for Addressing Tax-Apportionment Clauses

New Jersey Law Journal December 20, 2010

Tax Breaks Crumble for Temporary Stays

New York Law Journal September 20, 2010

The Life Insurance Checkup

New Jersey Law Journal August 16, 2010

Structuring a Foreigner's Purchase of U.S. Situs Real Estate

New Jersey Law Journal March 29, 2010

Simple Goals in a Complex World

The Hedge Fund Law Report March 18, 2010

A Look at the Current Muddled State of the Federal Estate Tax

New York Law Journal February 10, 2010

Roth IRA Universe Widens

New York Law Journal September 21, 2009

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Spring 2009

Estate Planning During and After Divorce

Cole Schotz Docket Winter 2008

Disclaimers: A Critical Post-Mortem Tax Planning Tool

New Jersey Law Journal November 10, 2008

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Fall 2008

Building Flexibility Into Irrevocable Trusts

New Jersey Law Journal September 1, 2008

Estate Planning in a Bear Market

Cole Schotz Docket Summer 2008

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Summer 2008

Transfer Tax Planning Issues for Non-Citizens

New Jersey Law Journal July 14, 2008

Special Needs Children and Estate Planning

Garden State Woman Spring 2008

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Spring 2008

Guiding Wealth Through the Generations

New Jersey Law Journal February 11, 2008

The Retirement Asset Swap

New Jersey Law Journal January 28, 2008

Funding a Trust With Retirement Assets

Cole Schotz Docket Winter 2008

Funding a Trust with Retirement Assets

New Jersey Law Journal December 10, 2007

Meet the Ashbys - Part II

Cole Schotz Docket Fall 2007

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. November 1, 2007

Two Approaches to Charitable Giving

New Jersey Law Journal July 2, 2007

Effective Real Estate Ownership Structuring

Cole Schotz Docket Spring 2007

Thinking About Selling?

Cole Schotz Docket Tax Considerations for Business Owners Preparing for Sale Spring 2007

Purchasing Commercial Real Estate Through an LLC

New Jersey Law Journal A hub and spoke structure removes a significant value from the owner's estate February 5, 2007

New Sales and Corporate Business Hikes

New Jersey Law Journal New Jersey's recent tax legislation was more than just a 1 percent hike in sales tax January 15, 2007

Florida's Favorable Tax Laws

New Jersey Law Journal A New Jersey resident could save thousands in taxes by moving to the Sunshine State January 30, 2006

Protect Your Family With a Special Needs Trust

Cole Schotz Docket Winter 2006

Source of Estate Tax Payment is Now an Issue

New Jersey Law Journal Wills must be properly drafted to account for the new deduction for state death taxes November 14, 2005

What Would Have Happened in New Jersey

New Jersey Law Journal After Schiavo: A look at the law surrounding living wills May 9, 2005

Stockholders and Operating Agreements

New Jersey Law Journal A successful business should develop and maintain a succession plan March 14, 2005

Who Wants to be a Millionaire?

New Jersey Law Journal Phillip S. Pepper November 15, 2004

The Importance of Estate Planning

Exceptional Parent Magazine November 2004

New Jersey Passes Domestic Partnership Law

Cole Schotz Docket Spring 2004

Reports of the Death of the Family Holding Company Have Been Greatly Exaggerated

New Jersey Law Journal Recent decisions have made tax planning with family entities a minefield, but one that can be navigated with careful planning November 17, 2003

Estate Tax Repeal? Definitely Not in New Jersey

New Jersey Law Journal May 26, 2003

Pet Trusts in New Jersey and New York, Tax

Trusts & Estates Law Monitor

Major Overhaul to Veterans' Benefits May Be on the Horizon

Elder Law Perspectives

Fundraising and the Special Needs Trust

New Jersey Law for Special Needs Children

May 2016 Newsletter

Cole Schotz News May 2016

April 2016 Newsletter

Cole Schotz News April 2016

Uncertainty Remains Surrounding the Nonprofit Hospital Tax Exemption

Real Estate & Construction Law Monitor January 21, 2016

Mary Browning published a chapter titled, "Family and Business Succession Planning Remains Imperative, Despite New Tax Exemptions"

Inside the Minds: Family and Business Succession Planning 2016 Edition

The Importance of Special Purpose Trusts in Estate Planning

New Jersey Law Journal December 17, 2015

Receiving a Deduction for Your Charitable Contribution on Giving Tuesday

Tax, Trusts & Estates Law Monitor December 1, 2015

IRS Proposed Regs Redefine the Terms Husband and Wife

Tax, Trusts & Estates Law Monitor November 13, 2015

2015/2016 Estate and Gift Tax Update

Tax, Trusts & Estates Law Monitor September 28, 2015

Family Limited Partnerships: Are Discounts Disappearing?

Tax, Trusts & Estates Law Monitor July 14, 2015

The ABLE Act

New Jersey Law for Special Needs Children July 14, 2015

Defending Against a Motion to Dismiss New Jersey State Lottery Claims

Tax, Trusts & Estates Law Monitor March 4, 2015

Toward a Better Buy-Sell Agreement

New Jersey Law Journal Business succession planning: Encourage your clients to get it done February 5, 2015

Florida Becomes the 36th State to Allow Same-Sex Marriage

Tax, Trusts & Estates Law Monitor January 9, 2015

President Obama Signs Into Law Tax Extenders and ABLE Act

Tax, Trusts & Estates Law Monitor December 19, 2014

Extension of 2014 Qualified Charitable Distributions

Tax, Trusts & Estates Law Monitor December 4, 2014

2015 Estate And Gift Tax Update

Tax, Trusts & Estates Law Monitor October 31, 2014

The Importance of Selecting the Best Fiduciary

New Jersey Law Journal July 24, 2014

Banking Institutions and Powers of Attorney

Elder Law Perspectives July 10, 2014

School Segregation of Special Needs Students

New Jersey Law for Special Needs Children July 3, 2014

Higher Exemption Amount Does Not Eliminate Need for Creative Estate Strategies

Aspatore Books Inside the Minds: Family and Business Succession Planning, 2014 ed.

How Pre-Death Probate Can Protect An Estate Plan

Private Wealth February 26, 2014

Analyzing the Power to Tax Internet Sales

New York Law Journal February 24, 2014

2014 Estate And Gift Tax Update

Tax, Trusts & Estates Law Monitor January 8, 2014

New Jersey Supreme Court Rules on Special Needs Trusts and Child Support Payments

New Jersey Law for Special Needs Children August 22, 2013

Mandatory Electronic Filing for FBARs Effective July 1, 2013.

Tax, Trusts & Estates Law Monitor June 25, 2013

Estate Administration In A Paperless World

Tax, Trusts & Estates Law Monitor June 4, 2013

2013 Estate Planning - Still Not The Time To Be Complacent

Tax, Trusts & Estates Law Monitor May 13, 2013

Who is a Large Employer Under Obamacare?

Employment Law Monitor May 9, 2013

New Jersey Estate Litigation: The Availability of Punitive Damages

Tax, Trusts & Estates Law Monitor March 5th, 2013

New Jersey Judiciary Asking for Volunteers to Oversee Guardians

New Jersey Law for Special Needs Children February 14th, 2013

After the Fiscal Cliff — A Summary of the New Federal Gift and Estate Tax Law

Tax, Trusts & Estates Law Monitor January 10th, 2013

Addressing and Understanding Client Goals, Motivations, and Concerns to Create Successful, Individualized Trust and Estate Plans

Aspatore Books Inside the Mind: Bests Practices for Structuring Trusts and Estates, 2013 ed.

The Clock Is Ticking on Rare Tax Planning Opportunities

New York Law Journal January 30, 2012

Storing Gold Offshore: What Your Clients Need To Know

New Jersey Law Journal October 17, 2011

Divorce Requires an Affirmative Review of an Estate Plan

New York Law Journal August 1, 2011

Estate Planning for Families with Special Needs Children

New Jersey Law Journal February 21, 2011

Best Practices for Addressing Tax-Apportionment Clauses

New Jersey Law Journal December 20, 2010

Tax Breaks Crumble for Temporary Stays

New York Law Journal September 20, 2010

The Life Insurance Checkup

New Jersey Law Journal August 16, 2010

Structuring a Foreigner's Purchase of U.S. Situs Real Estate

New Jersey Law Journal March 29, 2010

Simple Goals in a Complex World

The Hedge Fund Law Report March 18, 2010

A Look at the Current Muddled State of the Federal Estate Tax

New York Law Journal February 10, 2010

Roth IRA Universe Widens

New York Law Journal September 21, 2009

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Spring 2009

Estate Planning During and After Divorce

Cole Schotz Docket Winter 2008

Disclaimers: A Critical Post-Mortem Tax Planning Tool

New Jersey Law Journal November 10, 2008

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Fall 2008

Building Flexibility Into Irrevocable Trusts

New Jersey Law Journal September 1, 2008

Estate Planning in a Bear Market

Cole Schotz Docket Summer 2008

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Summer 2008

Transfer Tax Planning Issues for Non-Citizens

New Jersey Law Journal July 14, 2008

Special Needs Children and Estate Planning

Garden State Woman Spring 2008

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. Spring 2008

Guiding Wealth Through the Generations

New Jersey Law Journal February 11, 2008

The Retirement Asset Swap

New Jersey Law Journal January 28, 2008

Funding a Trust With Retirement Assets

Cole Schotz Docket Winter 2008

Funding a Trust with Retirement Assets

New Jersey Law Journal December 10, 2007

Meet the Ashbys - Part II

Cole Schotz Docket Fall 2007

The Advisor

An alert published by the Tax, Trusts & Estates Department of Cole, Schotz, Meisel, Forman & Leonard, P.A. November 1, 2007

Two Approaches to Charitable Giving

New Jersey Law Journal July 2, 2007

Effective Real Estate Ownership Structuring

Cole Schotz Docket Spring 2007

Thinking About Selling?

Cole Schotz Docket Tax Considerations for Business Owners Preparing for Sale Spring 2007

Purchasing Commercial Real Estate Through an LLC

New Jersey Law Journal A hub and spoke structure removes a significant value from the owner's estate February 5, 2007

New Sales and Corporate Business Hikes

New Jersey Law Journal New Jersey's recent tax legislation was more than just a 1 percent hike in sales tax January 15, 2007

Florida's Favorable Tax Laws

New Jersey Law Journal A New Jersey resident could save thousands in taxes by moving to the Sunshine State January 30, 2006

Protect Your Family With a Special Needs Trust

Cole Schotz Docket Winter 2006

Source of Estate Tax Payment is Now an Issue

New Jersey Law Journal Wills must be properly drafted to account for the new deduction for state death taxes November 14, 2005

What Would Have Happened in New Jersey

New Jersey Law Journal After Schiavo: A look at the law surrounding living wills May 9, 2005

Stockholders and Operating Agreements

New Jersey Law Journal A successful business should develop and maintain a succession plan March 14, 2005

Who Wants to be a Millionaire?

New Jersey Law Journal Phillip S. Pepper November 15, 2004

The Importance of Estate Planning

Exceptional Parent Magazine November 2004

New Jersey Passes Domestic Partnership Law

Cole Schotz Docket Spring 2004

Reports of the Death of the Family Holding Company Have Been Greatly Exaggerated

New Jersey Law Journal Recent decisions have made tax planning with family entities a minefield, but one that can be navigated with careful planning November 17, 2003

Estate Tax Repeal? Definitely Not in New Jersey

New Jersey Law Journal May 26, 2003

Pet Trusts in New Jersey and New York, Tax

Trusts & Estates Law Monitor

Major Overhaul to Veterans' Benefits May Be on the Horizon

Elder Law Perspectives

Fundraising and the Special Needs Trust

New Jersey Law for Special Needs Children

 

Hosted on the FirmWise platform.

© Cole Schotz P.C.

DISCLAIMER

The materials on this site have been prepared by Cole Schotz P.C. for general informational purposes only and are not intended to constitute legal advice. Viewers should not act upon this information without seeking professional counsel on the specific facts and circumstances in question from an attorney licensed in their jurisdiction. Use of this site does not create an attorney-client relationship between the user and Cole Schotz or any lawyer(s) within the firm. Any information sent to Cole Schotz or its lawyers through this site will not be treated as confidential and is not protected by the attorney-client privilege.

© Cole Schotz P.C.

Attorney Advertising

This website is an advertisement for a law firm. Statements and previous outcomes do not imply similar results in your matters.

© Cole Schotz P.C.