A Google search of “state funeral association master trust” will return hyperlinks to dozens of state funeral director associations. In the 1970’s, funeral associations began establishing master preneed trusts as an alternative to passbook savings accounts. As preneed gained acceptance with funeral directors, the associations saw the opportunity to provide administration and create a revenue
Care Funds
An Update to the Cemetery Unitrust Movement: a few more states but lagging interest on the part of cemeteries
It has been three years since we last posted about those states that have passed laws allowing cemetery trusts to take a unitrust election. Since then, Arizona, California and Indiana have joined the list. The movement towards fixed care fund distributions has not caught on as quickly as some thought when the concept was introduced…
Missouri Exempt Cemeteries: The Exception that is the Rule
When Missouri’s endowed care law was passed in 1994, all cemeteries were required to register with the Office of Endowed Care Cemeteries. Cemeteries can seek licensing as either an endowed care cemetery or a non-endowed cemetery, or the cemetery could claim it was exempt from Chapter 214 pursuant to the definition of “Cemetery” pursuant to…
Grantor Care Funds: Too Small to Pay for Flowers
It would be my assumption that the majority of the country’s cemeteries do not maintain a trust for the maintenance and care of its graves. While this may differ from state to state, most states’ perpetual care statutes exempt small family cemeteries, not for profit cemeteries, municipal cemeteries, county cemeteries and church cemeteries from their…
Concerns over “abandoned” cemeteries: When to act and who will assume control
These are tough times for cemeteries. Too many planned on a steady revenues from grave sales, and have not trusted enough funds for future maintenance expenses. Grave sale revenues have been dramatically cut by the public’s acceptance of cremation. Subsequent to the Great Recession of 2008, many of our funeral home clients reported a significant…
Cemetery Care Funds: Virginia and Georgia Join the Unitrust Movement
Effective July 1st, the cemetery laws of Virginia and Georgia are each amended to authorize fixed distributions from cemetery perpetual care trusts. They join Florida, Tennessee, Michigan, Missouri and Iowa in embracing some form of the unitrust option for cemetery care fund distributions. The unitrust option is a dramatic departure from the net…
Missouri County Cemeteries: Legislation to Allow Trust Diversification
The Missouri legislature has passed a bill to authorize county commissioners to diversify their cemetery trusts. Prior to the passage of House Bill No. 51 Missouri’s counties were restricted in how they could invest cemetery care funds. Essentially, a Missouri county could invest care funds only in government bonds. But, since the mortgage bond crisis…
A Treasury Market Out of Whack: Putting a hurt on death care funds
The July 25th Marketplace Morning Report on National Public Radio included a segment called Allan Sloan’s lessons on bond investments. Mr. Sloan is a business columnist for the Washington Post who recently wrote that the current Treasury bond market is “out of whack”, and poses a risker investment than the stock markets. Mr. Sloan…
Cemetery Care Fund Requirements: Clarifying the Math
Legislation was introduced this week in the Kansas Legislature, and one of the bill’s changes seeks to clarify how cemetery care fund requirements can be computed. We have found this a source of confusion for cemeteries and regulators in many states. Depending upon the type of interment right purchased, the care fund requirement is often…
Cemetery Care Trusts: The Public Interests
The International Cemetery, Cremation and Funeral Association (ICCFA) made an old but persuasive argument to get the IRS to exempt cemetery care trusts from the Medicare tax that will fund ObamaCare. As discussed in a prior post, the IRS had initially proposed to apply the tax to both cemetery care trusts and preneed trusts. With …