Adopt an Adult?

Have you ever thought of adopting an adult for inheritance purposes? This is a question both for lawyers and non-lawyers. Most people are not aware that you can adopt an adult in Maryland. It can be a valuable tool for estate planning and inheritance purposes. Although the overwhelming numbers of adoption proceedings involve minors, Maryland law provides that an individual of any age may be adopted.            

There are good reasons to adopt an adult as part of a thoughtful and effective estate plan. First, persons who are adopted, even as adults, are generally treated the same as natural-born children of those who adopt them. An adult who inherits from an unrelated decedent must pay a 10 percent Maryland inheritance tax on the assets inherited. 

However, adult adoptees, just like natural-born children, are not subject to the state inheritance tax when inheriting from their adoptive parents. Second, if someone dies intestate (without a Will) and without a spouse, his/her assets will be distributed equally among his children, whether adopted or natural born. Third, an adult adoption virtually ensures that the adoptee will inherit from the adoptee’s adoptive parents, because the likelihood of a successful court challenge to the adoptee’s status is significantly diminished following adoption.

During this past legislative session, the Maryland General Assembly considered legislation to legalize same-sex marriage. If that legislation had been enacted, then (presumably) the same-sex couples would receive the same tax benefits as heterosexual married couples do in Maryland. Upon the death of one partner in a same-sex marriage, if his/her estate was left to a spouse, there would have been no Maryland inheritance tax assessed, as the unlimited marital exemption would apply. 

Because the legislation did not pass, the 10 percent Maryland inheritance tax referenced above is still in effect. Therefore, if a partner in a same-sex relationship dies leaving the estate to a partner, the entire estate will be subject to a 10 percent Maryland inheritance tax. 

While an adult adoption may make sense in the context of domestic partners who want to insure that their partner inherits, there are other sound reasons for an adult adoption, as in the case of those who are childless but want to take advantage of provisions of a trust made by their parents or grandparents. 

One of the goals of Maryland adoption laws, which became effective in 1947, was to give adopted children the same status as natural children. This also applies to adult adoptees. Maryland law now provides that unless a Will clearly indicates otherwise, the use of the word “child, “descendant, “heir” or “issue” or any equivalent term includes an adopted individual, whether the Will was signed before or after the decree of adoption was entered.

Maryland law also provides that the legal effect of an adoption of an individual who is an adult is the same as that of the adoption of a minor. Among other things, that also means that an adult adoptee (as with all adoptees) loses the statutory right, in the absence of a Will, to inherit from his/her birth parents. However, the birth parents still can leave their estate through their Wills to their natural-born child, even when adopted by another.

Until the Maryland legislature approves same sex-marriage, adult adoption is one method to avoid the onerous 10 percent inheritance tax.  

A Funny Thing Happened on the Way to the Draft

As if trying to determine whether the Carolina Panthers should select Heisman Trophy winner Cam Newton with the first pick in the 2011 NFL Draft were not enough!

Last week, with the Draft looming in the background, Federal District Court Judge Susan Richard Nelson granted the NFL Players’ request for a preliminary injunction compelling the League to end the lock-out.  Judge Nelson then denied the League’s request that her ruling be stayed.  The League immediately appealed, and as the Denver Broncos were preparing to make their second-round selection, it was announced that the Eight Circuit Court of Appeals had issued a temporary stay of Judge Nelson’s ruling, effectively putting the lock-out back in place.  If you are confused, you are not alone.

For now, let’s start with the basics.  What is an “injunction” and what is a “stay?”  Simply put, an injunction is a court order which compels a party to either do something or, alternatively, to stop doing something.  In this case, Judge Nelson’s Order compelled the NFL to end the lock-out; but that is not the end of the story.  As you may know, any court decision can be appealed.  Judge Nelson’s order granting an injunction and compelling the League to end the lock-out is no different and, as expected, the League immediately appealed. 

So what happens to football while the case makes its way through the appellate courts?  That, sports fans, is where the “stay” comes in. A stay is a court order which preserves the status quo during the course of an appeal.  Think of a death penalty case, for example, where the condemned defendant sits in prison (very much alive, with the death sentence stayed) while the appeal is heard.  In the case of the lock-out, however, Judge Nelson refused to stay her ruling while the NFL appealed, and for a few short hours the lock-out was lifted. 

However, the decision to deny the stay, like any other court order is also appealable.  As the Denver Broncos prepared to select UCLA Free Safety Rahim Moore with the 45^th overall selection, we learned that the Eight Circuit Court of Appeals had issued an order granting the League’s request for a temporary stay, thus preserving the status quo of the lock-out. 

 – At least for now.  A ruling on the permanent stay is expected later this week.

David B. Applefeld, Esq.

NFL LABOR STRIKE

In case you have not heard, there is not an NFL labor strike.

Rather, on March 11, 2011, the “collective bargaining agreement” between NFL owners and the NFL Players' Association (NFLPA) expired, resulting in a “decertification” of the NFL NFLPA and a “lock-out” by owners.  In the likely event that your copy of Madden NFL 2011 did not come with a Black’s Law Dictionary, keep reading this Blog to understand what all this means.

“Collective bargaining” is a process by which a group of workers (the players) negotiate with their employer (the NFL owners) with the goal of reaching an agreement or contract which governs their conditions of employment.  If an agreement is reached, the parties refer to their contract as a “collective bargaining agreement.”

Employees are often represented in these negotiations by labor organizations such as the NFLPA.  Collective bargaining agreements typically last for only a specified duration and, upon expiration, must be re-negotiated.  Here, the collective bargaining agreement expired, which means that there is no current contract between the NFL players and owners.

“Decertification” is a process whereby a union stops acting as the bargaining representative for a group of employees (in this case the players), and permits the employees to negotiate with management directly.  Theoretically, this forces the employer to negotiate with each employee or player individually, and opens the door for employees to file individual claims against management (i.e. Peyton Manning’s anti-trust suit – a topic for later discussion). 

Finally, a “lock-out” is not a strike.  In fact, it is just the opposite.  A lock-out occurs when an employer closes its business and refuses to allow its employees to come to work until they agree to its terms. A lockout is invoked to put pressure on the employees or their union to accept management’s last offer because employees are not paid during a lock-out.  Because the NFL owners have “locked-out” the players, there can be no off-season workouts at the teams’ facilities. 

For now, there is no agreement, and NFL fans may have to stick to Madden’s game or turn to college gridiron to get their football fix.