Lancaster Law Blog : Lancaster PA Lawyer & Attorney : Russell Krafft & Gruber Law Firm : Pennsylvania : Lancaster's Legal Link

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No one can accuse the Internal Revenue Service of sleeping on the job.

You may remember a blog post of mine dated June 30th, 2008 called "IRS Standard Mileage Rate Change" in which I noted how quickly the IRS reacted to rising gas prices and increased their standard mileage rate change, effective July 1, 2008, from 50.5 cents to 58.5 cents per mile. This generally allowed employers to avoid reporting or withholding from increased reimbursements to employees for the remainder of the year.

As quickly as the IRS reacted to the rising gas prices, it has reacted just as quickly to the recent fall. Through IRS Rev. Proc. 2008-72, the IRS has lowered the standard mileage rate to 55.0 cents per mile for 2009. In addition, the standard mileage rate for medical or moving and medical expenses has been decreased from 27 to 24 cents per mile, and the rate for charitable purposes remains at 14 cents per mile.

According to IRS News Release IR-2007-192, the rates are based "on an annual study of the fixed and variable costs of operating an automobile . . . [and of] medical and moving purposes."
 

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Joint bank accounts created after a decedent makes a will can leave executors to face problems when it comes time to administer the estate. Often these accounts beg the question, "What was the decedent's intention?" More specifically, did the decedent want to give the surviving party to the account ownership in the balance in the account or merely use of the account during life for convenience purposes? Under the Pennsylvania Multiple Parties Account Act, generally the surviving party or parties to the account own the balance after the decedent's death. If there is clear and convincing evidence, however, the executor could show that the account was only a convenience account and that the balance should be turned over to the executor for deposit in the estate rather than be paid to the surviving party to the account. 

Now, even that predictability has ended. In a case known as In Re Estate of Amelia J. Piet, the Pennsylvania Superior Court ruled that if a joint account is created after a Will has been executed, the surviving owner does not receive the account if registration of the account is contrary to the disposition of assets under the Will. Suddenly, there is less predictability as to the disposition of multiple party accounts.   At the moment, the only solution is to document one's intentions very carefully if a joint account is created after the execution of a Will. It's generally advisable to review your Will or Estate Plan every few years to make sure your assets are properly distributed. 

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Traditionally, you may have thought that a prenuptial agreement is common only among the rich and famous. However, a prenuptial agreement can be beneficial to any person considering marriage, regardless of the size of your personal wealth. Here are some reasons why you should consider having a postnuptial agreement in place prior to tying the knot.

1. You have children from a prior marriage whose financial interests you wish to protect.

Under Pennsylvania law, all property acquired during a marriage is marital property, including the increase in value of assets owned by a spouse prior to the marriage. Failure to protect non-marital assets could jeopardize your children's financial interest or future in the event of your death or divorce.

2. You have an inheritance in your name or expect to receive one during your marriage.

Your inheritance could become a marital asset subject to equitable distribution if you do not protect it in a prenuptial agreement.

3. You want to protect your family business or other assets you acquired prior to marriage.

All assets are subject to valuation during a divorce. Failure to protect your interest in the family business could lead to a complicated business valuation as part of an equitable distribution proceeding, and could open up a claim that it is a marital asset.

For similar reasons as stated above, you should consider a prenuptial agreement if any of the following are present in your case:

• You are the beneficiary of a trust,
• You earn significantly more than your partner,
• You have more income or assets than your partner
• Your partner has a tendency to "overspend" and has incurred significant premarital debt,
• You want to decrease your financial exposure for your partner's financial liabilities.

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The day finally arrives. Your attorney calls you or perhaps notifies you in writing that the Divorce Decree has been handed down. At long last (maybe six months, maybe a year, maybe even three or four years) it is finally over.

Not true! In the famous words of the "political philosopher" Yogi Berra, “it ain’t over till it’s over”. The Divorce Decree (assuming no appeal) in many cases is not the end, and many important matters may still require attention before that Postnuptial Agreement or that decision obtained after a Hearing with blood, sweat and tears - the result you worked so hard to achieve - materializes.

Like many other things, the devil is in the details and taking care of the details is still required. For example, the failure to remove the ex-spouse as a primary beneficiary of life insurance issued through an employer may negate the provisions of a Postnuptial Agreement which provides that the ex-spouse should have no interest in life insurance proceeds or other property of the spouse at death.