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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=MsoNormal><a name="_MailEndCompose"><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>If the original $100k was a gift, the donor, not your decedent or his surviving spouse, would have been the one to report the gift to the IRS.<o:p></o:p></span></a></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'><img width=23 height=27 id="Picture_x0020_1" src="cid:image002.jpg@01D3D89D.250A6660" alt="cid:image001.jpg@01D1F8A6.19C81E60"><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'>Sara D. Longley, J.D., LL.M.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'>L</span><span style='font-size:9.0pt;font-family:"Century",serif;color:#1F497D'>ONGLEY</span><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'> L</span><span style='font-size:9.0pt;font-family:"Century",serif;color:#1F497D'>AW</span><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'> PLLC <o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'>1734 NW Market Street<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'>Seattle, WA 98107<o:p></o:p></span></p><p class=MsoNormal><a href="tel:%28206%29%20434-5644" target="_blank"><span style='font-size:11.0pt;font-family:"Century",serif'>(206) 434-5644</span></a><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'><o:p></o:p></span></p><p class=MsoNormal><a href="mailto:Sara@longley-law.pro" target="_blank"><span style='font-size:11.0pt;font-family:"Century",serif;color:#0563C1'>Sara@Longley-law.pro</span></a><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'><o:p></o:p></span></p><p class=MsoNormal><a href="http://www.longley-law.pro/" target="_blank"><span style='font-size:11.0pt;font-family:"Century",serif;color:#0563C1'>www.longley-law.pro</span></a><span style='font-size:11.0pt;font-family:"Century",serif;color:#1F497D'><o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>This email is intended only for the individual to whom it is addressed and may contain information that is privileged, confidential, and/or exempt from disclosure. If you have received this message in error, please inform the sender by telephone or reply email and delete this message and all attachments. Thank you.<o:p></o:p></span></p><p class=MsoNormal><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><b><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>From:</span></b><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'> wsbapt-bounces@lists.wsbarppt.com [mailto:wsbapt-bounces@lists.wsbarppt.com] <b>On Behalf Of </b>Brent Williams-Ruth<br><b>Sent:</b> Friday, April 20, 2018 8:59 AM<br><b>To:</b> WSBA Probate & Trust Listserv <wsbapt@lists.wsbarppt.com><br><b>Subject:</b> [WSBAPT] The story changes..... Gift vs. Unrecorded Mortgage<o:p></o:p></span></p><p class=MsoNormal><o:p> </o:p></p><div><div><p class=MsoNormal>Good Morning and Happy Friday list!<o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>My prior email is amended as my client has given me the entire backstory. Many twists, any guidance is appreciated. Will be hitting the books this afternoon to find the answers. <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>There exists (so says my client, I have not seen it personally yet) a letter between client/personal representative - the surviving spouse, Decedent, and "Mrs. Smith" who gifted the two of them $100,000. (The only document allegedly in existence is that this money is a gift and not expected to be repaid). Surviving Spouse is going back to look to see if money was reported to IRS as gift - though I find it unlikely. <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>Apparently, Decedent was sending money, over $12,000 since then to Mrs. Smith. This was done without knowledge of the surviving spouse. <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>Fast forward to January 2018. Two weeks after Decedent passed, Mrs. Smith tells Surviving Spouse that Decedent was paying her off, and that they had been meaning to sign contract/agreement saying that money was a loan and interest would be due with payment - but to the surviving spouses' knowledge, no such document was ever created or executed. <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>Mrs. Smith is calling for repayment, plus interest. She wants all money now but is willing to just let Surviving Spouse pick up where Decedent left off - but charging interest. <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>Questions that are running through my head (and please feel free to let me know if I have missed a question that I need to look up)<o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>1) Since there is, currently, no other known document signed by all three (a marital community and Mrs. Smith) other than the Gift letter - do I stop right there and just make sure that they amend the 2016 tax return to declare such a gift (assuming it was not done originally)?<o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>2) If I don't stop, and there IS a signed contract between Decedent and Mrs. Smith only indicating that the arrangement was a non-recorded mortgage with interest due - would Garn-St. Germain apply where Mrs. Smith is prohibited from calling the note; <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>3) Would such a mortgage contract even be enforceable under Washington law given that as a community asset, Decedent encumbered the property without the knowledge and consent (and signature) of Surviving Spouse who has the good faith belief that this was a gift?<o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><div><p class=MsoNormal>Thank you again for any suggestions on where to start my dive into coming up with a solution for my client. <o:p></o:p></p></div><div><p class=MsoNormal><o:p> </o:p></p></div><div><p class=MsoNormal>Brent<o:p></o:p></p></div><p class=MsoNormal><o:p> </o:p></p></div><p class=MsoNormal>-- <o:p></o:p></p><div><div><div><div><div><div><div><div><div><p><b>Brent Williams-Ruth</b> <br><i>Founding Member</i><o:p></o:p></p><p><b>BWR Consulting, PLLC</b><o:p></o:p></p><p>Phone:<span style='color:#004080'> </span>(425) 830-5134<o:p></o:p></p><p><a href="mailto:brent@bwrconsults.com" target="_blank">e-mail</a> / <a href="http://www.bwrconsults.com" target="_blank">website</a> /<span style='font-size:9.5pt'> </span><a href="http://www.facebook.com/bwrconsults" target="_blank"><span style='font-size:9.5pt'>facebook</span></a><span style='font-size:9.5pt'> </span><o:p></o:p></p></div></div></div></div></div></div></div></div></div></div></div></body></html>