Of Counsel Interview: “Highly Regarded T&E Veteran Serves Thriving Nevada Market”

Trust & Estates Practice Group leader Bob Armstrong was interviewed in the November issue of Of Counsel: The Legal Practice and Management Report. The interview covers Bob’s path to the legal profession, the factors that led him to the field of trust and estates, and his 45-year career at McDonald Carano where he developed and continues to grow the Firm’s Trust & Estates Practice. Bob also shares his insights on the challenges and opportunities for lawyers interested in the trust and estates arena, as well as the promising outlook for the practice as older generations will be handing down $70 trillion between 2018 and 2042, with nearly $61 trillion going to heirs and the balance to philanthropy.  Bob also explains why Nevada is the leading situs jurisdiction with the most favorable laws for trusts. Bob’s interview is provided below and available in pdf here.

 

“Highly Regarded T&E Veteran Serves Thriving Nevada Market,”
Of Counsel: The Legal Practice and Management Report, November 2024

It’s no secret that often a variety of factors converge to inspire people to choose a career in the legal profession and practice in a particular legal area. That’s certainly the case with Robert “Bob” Armstrong, a seasoned partner at Nevada’s McDonald Carano. Consider this confluence of career-shaping, instrumental elements: When he was young Armstrong met and was impressed with his father’s acquaintances who practiced law; he took influential post-graduate classes; and he returned to his roots where he found it better to be legal “generalist,” as he calls it. All of this, and more of course, led Armstrong into the trust and estates area. More specifically, he focuses his practice on estate, gift, generation-skipping, and income tax planning, as well as T&E administration, business and real estate transactions, and the formation, operation, and governance of family trust and retail trust companies.

It seems he’s good at what he does. One of his many clients over his long, storied career had this to say about him to the Chambers ranking agency: “Bob is an excellent tax strategist with a cutting-edge awareness of pending changes and direction in the space.” Another said, “He is very smart, organized and creative, a good communicator and very good at articulating complex concepts.” And one client summed up Armstrong’s legal service with these glowing words: “He is the best trusts and estates planner in the state. He has a huge breadth of knowledge and has been around for a long, long time. He remembers everything.”

Recently, Of Counsel talked with Armstrong about the specific influences that served as a catalyst for his career and practice area; the reasons Nevada has become a T&E-friendly state; the predominant challenge facing this particular legal landscape; and other topics.

Following is that edited interview.

Of Counsel: Bob, you’ve been practicing law for a long time. Please take yourself back to the very beginning. Why and how did you become a lawyer?

Bob Armstrong: Yes, it goes back quite a while. My dad was one of the first certified public accountants in Nevada and he started a firm, and also became the president of a mining company. When I was growing up, I used to have to drive him around parts of northern Nevada. We would generally run into lawyers who were representing the mining company or the families involved in the mining company.

I always had a great deal of respect for what my dad did, but I was looking at the lawyers and thinking, Geez, that looks like a lot more fun and looks like it’s more challenging. So, I grew up with that notion in mind. As I was considering what to do after high school, I knew I wanted to get a good undergraduate degree, and Santa Clara University at the time had and still does have one of the best undergraduate accounting programs, so I took advantage of that. As part of the program, we had to take business law. I was working for my dad’s firm during the summer, and continued to have interactions with legal counsel. That piqued my interest. My dad introduced me to some really outstanding tax lawyers in the community who all had gone to New York University or other very good schools, so that further developed my interest in honing the areas of law that I’d be most interested in.

Santa Clara was invaluable to me because I passed the CPA exam when I was there, before I graduated. I got a nice letter about two months later saying, “Congratulations, you passed all parts of the exam.” That was really a great boost for me because it gave me a lot of confidence that I was headed in the right direction.

Of Counsel: What led you to trusts and estates?

Bob Armstrong: I took an estate planning class at Georgetown University. The former dean, Paul Dean, and I became very close. We had a mutual friend who really shepherded me at Georgetown. I took his estate planning class, and both that class and the business planning class opened my eyes up to the importance of both of those in family succession and business succession. I developed a real interest in that area. And then I took another estate planning class when I was at NYU and that further cemented it. I always knew I wanted to come back to Nevada. As much time as I spent on the East Coast and enjoyed it, I always knew I wanted to get back home. When you’re practicing tax law, you have to be multi-talented. You have to be able to do corporate tax, partnership tax, but a large part of your practice is representing people in their estate planning. That was the beauty of coming back to Nevada at the time. You could be more of a generalist than you can today. So, I was blessed with being able to do corporate transactions and acquisitions as well as represent high-net-worth individuals and handle their estate planning—almost right off the bat. One of my initial clients was a very prominent person who unfortunately passed away shortly after that, and I was drawn into the middle of a major complex estate administration. One of the assets ultimately went public, and, it was kismet. It was remarkable.

Of Counsel: Lawyers who practice in the T&E area of course have to be a legal counselor, but also a family counselor and help navigate family dynamics. Do you find that challenging and what skills do you need to do that?

Bob Armstrong: It’s very challenging. I took a couple of undergraduate psychology classes on a whim, but actually they turned out to be very beneficial. You always hope to work with fully functional families that all are on the same page and going in the same direction. But that’s not real life anymore, if it ever was. What you’re trying to do is understand the family, where they came from, their dynamics, their strengths and also their weaknesses. You do an estate plan and, often, a business succession plan as well.

With a business plan, you’re trying to bring in all of those components, and it’s not so much driven by the tax results or the liability issues as opposed to making sure it’s going to work for the long term. That’s a challenge. That’s why I think the combination of being a CPA and having the background I’ve had gives me a perspective that benefits my clients. With one client, I was part of the team that was on the road show when they went public and would answer questions from investment advisors because the family members were comfortable that I could speak on their behalf. You just don’t see that happen very often. But I really grew up with that family and fully understood their business. Consequently, I could communicate the excitement we had about the company.

A Silver State for T&E

Of Counsel: Right now, the Rupert Murdoch family is all over the news, grabbing big, bold headlines about its trust and estates legal battle. It’s really a high-prolife skirmish and it’s unfolding in Nevada. And, as you know of course, a lot of high-net-worth families do their T&E matters in Nevada. What are the reasons that The Silver State is such a favorite for trusts and estates?

Bob Armstrong: It’s evolved over time, but what we found is that a cornerstone of it is [twofold]: our proximity to California, and our lack of any state income tax. Those are the real drivers. There are only about five or six jurisdictions in the United States that are truly competitive in handling the high-net-worth or ultra-high-net-worth marketplace. What these clients are looking for are jurisdictions that are particularly suitable as a domicile for long-term trusts because they’re not distributing wealth through these trusts; they’re incubating their wealth so they can continue to diversify and compound their wealth over multiple generations.

When you have that framework you then try to hunt for jurisdictions that will support that objective, and Nevada falls into that category because we’ve got a unique blend of tax laws. We have developed our trust laws tremendously, and we have some very innovative business organization structures. One thing that I don’t think has been discussed enough is the development of Nevada’s family trust company and license family trust company statutory and regulatory environment. I call these family trust companies the potential Swiss Army knife of managing this type of wealth. Since 2009 when we enacted the statutes here—and Nevada was one of the first to do it—we have seen an enormous amount of growth in this high-net-worth and ultra-high-net-worth area. We continue to see it today and we’re getting validated. We have a number of national trust companies that have either operated here or formed state-chartered trust companies here—such firms as Northern Trust, Bessemer Trust, Charles Schwab, and several others. They see that this is a jurisdiction where you want to be. So, we’re an alternative to Delaware, and sometimes Delaware wins out, but other times we do.

Of Counsel: What’s one of the biggest challenges you see?

Bob Armstrong: The biggest fear I have in the trust and estates area is this: There has been a talent shortage trend over the last 10 to 20 years—because of changes in the tax laws and the removal of a lot of people from the transfer tax environment. There aren’t enough people going into the trust and estates area at a time when you’re seeing an excess of 30 trillion dollars being transferred from the Baby Boomers to their progeny.

So, you have an environment where there’s a significant need for wealth transfer planning but a real diminishment of people coming into this legal area. And, law schools are removing trust and estates from a primary subject matter that they’re required to teach, along with state bars around the country that are no longer requiring a trust and estates subject matter to be tested. The combination of those things has really created a very contracted market of available talent here at a time when it’s needed the most. That’s very, very challenging. In all facets [there’s a shortage], whether it’s the financial advisors, the tax advisors, the trust administrators. It’s maybe the single most difficult thing we’re dealing with. I think we’re going to have to adapt quickly and adopt AI techniques and incorporate them into our practice to make sure that we can keep up because of this talent drag.

Crafting & Executing the Plan

Of Counsel: What would you tell a young lawyer to try to convince him or her that the T&E world is a good one for them to explore?

Bob Armstrong: That’s a great question. What I’ve been able to do when we’ve successfully recruited is give them a vision of what we’re doing here, the challenges we have, and the opportunities we offer. When we look at trust and estates, we have a tendency to focus on drafting wills and trusts, but it’s really a whole broader category, which is the integration of clients documents, their entities, everything, and dealing with their personalities in a continuum.

If you look back at my career, I’ve worked in all those areas. The message I send to the young lawyers is, you’re a transaction lawyer, don’t just call yourself a trust and estates lawyer. You’re much more than that. You’re a transaction lawyer, an advisor, and you coordinate a lot of things. You’re helping families plan, and it’s great to come up with a plan, but you’ve got to know how to execute it. We are starting to see some lawyers who have life experience and are focusing on this area. That’s the sweet spot, that they’re mature enough to understand that this is an important subject matter. They’re getting introduced at a level quicker than other lawyers have in a different subject matter. So, we have to bring them on quickly and they have to be mature and thoughtful and have had life experiences. Those are the ones who will be the most successful.

Of Counsel: You strike me as a modest person, in spite of all of your accomplishments. But what are you most proud of as a lawyer?

Bob Armstrong: Well, I started with our firm back in 1980, and it’s remarkable that I’ve stayed with one firm for my entire career. In 2025 it will be 45 years. I started with the firm when there were about five or six lawyers. We were a well-regarded firm among a number of well-regarded firms.

One of the goals I’ve had is to continue to fully develop our partnership in all of the practice areas in which we serve our Nevada clients. I have a deep regard for our state. And what’s occurred here with quality regional firms moving in is that they’ve kind of lost focus on Nevada for Nevada. What I’ve tried to do not only in my practice—and I’ve participated in the management of the firm for almost 40 years—is develop practice areas that are needed in the state, with a sharp focus on Nevada needs. That’s why you haven’t seen us go into California or Utah or other logical places for us to expand. We want to retain that focus.

We make sure we’re developing talent in the areas that Nevada needs it in. I think that’s why you’ve seen us emerge with [high] Chambers ratings in a number of the key practice areas, and that’s a testament to what we’ve been doing as a firm since we were founded 75 years ago.

Media Contact

Mark Buckovich

[email protected]
702.257.4559