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As discussed in our prior post, funeral homes are becoming increasingly dependent upon their preneed trustee for individual account administration.  Many trustees that provide account administration rely upon programs that use tax cost basis accounting.  (For a prior discussion of tax cost basis see “Consumer Options and Administrative Hurdles: Market Value Allocations”.)    Tax…

One strength of the state association master trust is that it can provide the ‘critical mass’ required for economies of scale to reduce trust management costs.  As the state master trust grows in size, the association can better negotiate asset management arrangements.  However, the reality has been very different for these programs.  The reorganization of…

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 …

 A cemetery operator recently expressed his frustration with the trust officer of his care fund trust.   An examination of the trust had cited the operator for inappropriate distributions from principal with regard to expense payments.  We suggested to the operator that it is very common for trustees to set up care fund accounts with …

I stand corrected.

A representative of the Michigan Funeral Directors Association advises that their request for proposal for a new investment advisor for the master trust has resulted in the selection of a firm that will not only assume a true fiduciary relationship to funeral directors and consumers, but that will also guide the Association…

If you haven’t noticed, there has been some turnover among the associations’ preneed fund managers. With the threat of additional litigation in Wisconsin, this trend could continue. But not all of the turnover has been as publicized as what we have seen in Illinois and Wisconsin. After 20 years at the helm, Merrill Lynch recently…