We recognize the sensitive nature of planning your estate. Our estates and trusts group approaches all matters of estate planning with sensitivity, patience and concern, while maintaining the confidentiality of your assets. No family estate matter is too small or too large. Our firm has extensive experience in the trust and estate planning arena, and we handle both simple and complex estate matters.
There are some fundamental documents that we will discuss as part of your estate plan. These documents serve different purposes, but are part of a complete estate plan.
Power of Attorney
A power of attorney is your authorization to appoint another person or persons to act for you during your lifetime. The most common type of power of attorney is durable power of attorney that is effective upon acceptance by your agent. We can counsel you on the different types of powers of attorney to suit your particular needs. We strongly recommend that every person have a valid power of attorney in place. If something were to happen, and you did not have a power of attorney in place, your family would be required to obtain a court order to take action on your behalf. This expensive alternative can be avoided by having a power of attorney in place.
Healthcare Declaration/Living Will
This document governs the care and treatment you wish to receive should you be in an end of life stage. We will counsel you on the appropriate completion of this document so that your intentions are honored at this time of life.
This final document sets forth your final wishes for the administration of your estate, and the disposition of your assets. In your Will, you will appoint the Executor or Executrix who will be in charge of settling your estate. You will also establish who you want to receive your assets, and when they receive them. Through the use of trusts, we can delay the receipt of a person’s inheritance, or set limits on how much they receive. We can also prepare within your Will a Special Needs Trust so that a beneficiary with special needs does not lose the government benefits to which he or she is entitled.
We also work with our clients to minimize the taxes that will become due upon death. This might include the use of trusts or gifting strategies to remove assets from your taxable estate prior to death.
For some estate plans, we will recommend to a client that we use a Trust to implement their wishes. There are many types of trusts with many different names that it is often confusing for many people. Generally, trusts can be formed during your lifetime as a document separate from your Will (Living Trust), or can be created within your Will (Testamentary Trust). Trusts can also be “irrevocable” or “revocable.” An irrevocable trust is used for tax planning, since the assets in the trust are not taxed to your estate. However, once you fund them, you are generally prohibited from terminating the trust and retitling the trust assets to your name. Revocable trusts can be terminated by the person who created the trust, and the assets can be retitled in his or her name. These are the most common type of trusts, but do not provide any shelter from estate or inheritance taxes.
Some of the instances when we will use a trust are as follows:
- Irrevocable Life Insurance Trust (ILIT) is an irrevocable trust that is formed for the limited purpose of owning life insurance policies. An ILIT will save federal estate taxes by removing the value of life insurance policies from a taxable estate. Note that life insurance proceeds are not subject to Pennsylvania inheritance tax, so ILITs are only useful for estates subject to federal estate tax.
- Special Needs Trust is a type of trust that will provide benefits to special needs individuals without disruption to the person’s government benefits.
- Second marriages: It is sometimes helpful to allocate assets into a trust for the benefit of children from a prior marriage.
- Delayed inheritance: We can also use trusts to delay or control the timing and payment of inheritance to your heirs. This is most frequently used with young children and adults who may not have the life experiences to handle receiving their inheritance in a single lump sum. By spreading out the payments (e.g. age 25, 30 and 35), your heirs can receive assets over a period of time.
In the event that a loved one has passed on, we are able to assist your personal representative in carrying out the terms of your estate plan, including making sure your assets are distributed in accordance with your wishes, and all taxes are paid. Unlike other firms who bill you based on a percentage of the value of the estate, we prefer to handle these matters on an hourly basis based on the actual amount of time we work. This leads to a more cost efficient handling of the probate proceedings and helps families keep more of their assets. If you prefer, we will work with clients on an agreed-upon flat fee for estate administration.
Orphans Court Litigation
In addition to our estate planning and administration practices, we represent parties in all types of orphan’s court litigation, including guardianships, will contests, claims against agents under a power of attorney and claims against an estate by creditors.