Posted on 05/06/2020 9:41:32 AM PDT by NRx
During their more than 30 years of marriage, Texas billionaire Ed and Marie Bosarge accumulated an unusual collection of treasures.
They owned 12 homes, including five properties in Maine and a private island in the Bahamas. They had a 180-foot sailing yacht with its own grand piano. They bought a $5 million Egyptian mummy. Marie bought some of Marilyn Monroe’s personal effects, including her furniture, dresses and bras.
“It was over the top,” Marie said of their lifestyle.
Now, instead of living the high life, Marie Bosarge fears going under. When Ed filed for divorce in 2017, Marie discovered that almost all of the couple’s property — from the homes and island to her jewelry and even some of their tableware — had been put into a special trust that shielded the assets from any claims. Rather than getting half of a fortune she estimated to be worth more than $2 billion, she may wind up with little or nothing after paying her legal bills.
In a lawsuit filed in 2018, Marie claims that the trusts “were created and used by Ed to hide income and property and to hold what would otherwise have been personal income and assets.” She claims the purpose of the trusts and the transfer of assets between the trusts was “to cut Marie out of her rightful share of the community estate.”
Attorneys for Ed Bosarge — who founded high-speed trading firm Quantlab — declined to comment on the case, citing confidentiality rules. Marie’s attorney also declined comment. But in court papers, Ed’s attorneys have claimed that the assets are owned and controlled by the trust, not by him, and are therefore not marital property. They say the total value of the couple’s marital property, which would be subject to division, is about $12 million.
(Excerpt) Read more at cnbc.com ...
You obviously know nothing about Trust Law. Trusts are considered separate entities, and exist specifically for the purpose of shielding assets from those seeking to make a claim on them (most notably, the IRS). Whether they were started before or after the marriage started is irrelevant. Once an item is placed in a Trust, it is no longer an asset of the individual or couple, just as if it were sold. In fact, the way that an item is put in a Trust is a transfer of Title. Trying to blow up trust law is simply not going to happen. Her only hope is that that his lawyers screwed something up in the creation of the Trust (not out of the question), but if they did their job right, she will get nothing.
LOL!!
Texas is a community property state, which means any property accumulated during their marriage is owned equally by them. Most community property states have statutes that provide that community property can’t be conveyed at less than fair market value without the consent of the spouse. If that’s the case in Texas and he conveyed property to the trusts without her consent and without adequate consideration, the transfers to the trust would likely be voidable.
The list of their possessions is truly sickening. They can’t take a damn thing with them, but will one day stand naked before the Lord. Their $5 million mummy won’t impress Him. Their good deeds had better do so.
If those trusts were funded by community assets she should get half their value, unless she waived her rights someway.
Read post #17. This woman was intrinsic to the creation of their business and wealth. She deserves half.
So. “Nothing” to this woman is half of 12 million? I’ll take that nothing in a heartbeat!
Trusts have no requirement for compensation when items are put in them. I really cannot believe how many people on here have zero clue what they are talking about regarding Trusts. Trusts exist so that you can put items in and control them while shielding them from counting as assets, especially after you die. If you were “compensated”, then that compensation would be taxable income, in which case you just eliminated one of the major benefits of having a trust in the first place. You have heard about the “death tax”? Trusts are how you avoid it. Trusts are also the mechanism to keep you from losing your business when you get sued. Create a Corp (C or S), then a Trust, and the ownership shares of the Corp are then owned by the Trust. You have several businesses ... great, the Trust owns them all. Now, if your business gets sued, they can only go after the assets of the one business, not all of them, and they can only go after you personally for that which you dont have protected in the trust. That is the wifes problem. Billions in the Trust, which she benefitted from for years (lower taxes), but now it is inconvenient for her because she wants half of what is in the Trust ... but she cannot touch it because she is not the Trustee.
It depends on who was the owner when the asset was created. It sounds like he put assets created after marriage in a trust for himself. I’d guess she’ll get half and attorneys fee’s which is fair.
Modest me could live a long time and well for my standards or be able to get that Willys jeep restored.
I’m being silly about the last bit. At times it feels I will never get there.
So umm... are you married now then?
Lol!
You should read Robert Kiyosaki’s Cash Flow Quadrant. Most people are employees, and have the mindset of being an employee, which is why they are not rich, nor ever will be rich. You do not get rich by leaving all your assets unprotected ... the first lawsuit will wipe you out. It is obvious that these people are not E (employees), S (small business owners), or B (large business owners). These people (at least the man) are I (Investors), and as such they(he) did everything to ensure that their(his) assets were protected. Nothing illegal, nothing shady. You made a MAJOR assumption that she was intrinsic to the creation of the wealth. If so, she should have had stock in the company herself, and put it in her own Trust. They were obviously savvy enough to know about Trusts, so the fact that she was not granted shares in the business tells me that she was NOT intrinsic to creation of the wealth.
By the time this thing is done the two of them will have lost most of the fortune and their lawyers will be billionaires. I hope Ed's Russian squeeze was worth it because she will pack her bags when the money is gone,
I (Investors) with a lot of money can do a lot to protect their assets, but in the end nothing in this world is truly safe. The biggest risk now that it has been announced to the entire world that Ed has billions of dollars stashed away in these trusts is that hackers and governments will go to herculean efforts to track them down and steal them or seize them. I think that there is a good chance that Ed, his Russian mistress and his blond wife will all end up with very little.
This SD system has been well known for years... Nothing “secretive” about it... There’s no way that, after 30-years, she wasn’t aware of it...IMHO...
OTOH, if they didn’t have a login and contribute to FreeRepublic, they didn’t have “everything”...
First among them is you, I'm afraid. I'm an attorney having extensive experience with trusts. Where to start?
Trusts have no requirement for compensation when items are put in them.
Correct.
Trusts exist so that you can put items in and control them while shielding them from counting as assets, especially after you die.
Trusts are used for many purposes, including shielding property from creditors, controlling disposition of assets, avoiding probate, and minimizing estate taxes. Depending on the purpose of the trust, sometimes the grantor can control the assets during the grantor's lifetime and sometimes the grantor can't. In order for a gift to a trust to be a completed gift for estate and gift tax purposes, the grantor can't retain any significant control over the trust.
If you were “compensated”, then that compensation would be taxable income
It depends. One can gift property to a trust or sell property to a trust. It the trust provides compensation for the transfer, it's only taxable if it's a taxable transaction. For example, if I buy real estate for $800 and convey it to the trust for $800 at a time when it's worth $800, there will be no tax because there is no gain or gift associated with the transfer. If I convey that same property to the trust at a time it is worth $1,300 in return for payment of $1,000 I will recognize capital gain of $200 and have made a gift, potentially subject to gift tax, of $300.
You have heard about the “death tax”? Trusts are how you avoid it.
Nope. The estate tax and gift tax are unified. Gifts to trusts are subject to the gift tax. One can use a trust to help minimize "death taxes" by gifting appreciating property to the trust. That shields post-gift appreciation from tax, but not the value of the property at the time contributed.
Create a Corp (C or S), then a Trust, and the ownership shares of the Corp are then owned by the Trust. You have several businesses ... great, the Trust owns them all. Now, if your business gets sued, they can only go after the assets of the one business, not all of them, and they can only go after you personally for that which you dont have protected in the trust.
That is silly. The purpose of a corporation is to shield the owners from personal liability. You set up a corporation for each business and you are done. Having the corporations owned by the trust accomplishes nothing except significantly complicating matters.
Billions in the Trust, which she benefitted from for years (lower taxes)
Nope. Trusts do not have lower taxes. The rates are generally the same as for individuals, but the maximum rate is reached much more quickly for trust income.
but now it is inconvenient for her because she wants half of what is in the Trust ... but she cannot touch it because she is not the Trustee.
Nope. It looks like most of the wealth was created in Texas, which is a community property state. As such, she was the owner of half of the assets contributed to the trust. If her husband transferred those assets without her consent, the transfers are potentially void. A court has the ability to reverse the transfers.
(Don't worry, I won't send you a bill for educating you on these matters. Consider it a public service.)
RainMan
Would she have a shot if she claimed fraudulent conveyance?
If she had given him POA (or signed transfer documents herself) that would /could go against her.
I can see contingent fee lawyers having an interest.
Presumably the 19 year old that replaces her won't get it either.
KevinB
Excellent summary. Trust accounting can be very interesting.
Few people even have a rudimentary understanding of the tax implications or the legal reasons.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.