Last week, I covered the myth that you need to avoid probate. One common reason people want to avoid probate is because they believe it is one way to avoid inheritance tax. Not so fast. Whether or not an asset is a probate asset has no bearing on whether or not it is subject to
“I need to avoid probate!” I can’t tell you how many new estate planning consultations begin with questions relating to the belief that it is important to avoid the probate process. Clients desiring to avoid probate often ask for a complex and costly estate plan. When I first started practicing, I couldn’t figure out where this fear came from. But a quick search of the internet provides some insight. Countless articles, books, and lectures tout the importance of avoiding probate like it is some poison laced process that only the strong survive.…
Continue Reading Myth #5- I need to avoid probate!
If myths 1 through 3 haven’t convinced you that you need a Will, perhaps this one will. At more than one networking event or social gathering, I’ve been cornered by someone who thinks they have found a way to “game the system.” Often times, this master plan includes putting everything in joint names with their…
This is a big one among couples with kids from previous relationships. People come in and say they want to leave everything to their spouse and then their kids. Often time people think they can control what happens to their belongings after their surviving spouse dies through a basic Will.…
Continue Reading Myth #3- When my spouse dies, my kids get what is left.
You might have read myth one and said, “Lindsay I don’t have kids and I’m married. I don’t need a Will because everything will go to my spouse.” You may be right. Then again you may not be. Do you really want to take that chance? The intestate statute has limited circumstance where the spouse…
In a historic 2014 ruling, the U.S. District Court in Whitewood v. Wolf made same-sex marriage legal in Pennsylvania. This ruling, while finally allowing a sizable segment of the population the same legal freedoms heterosexual couples have always enjoyed created problems for some same-sex couples that had done their best to take care of one another in a pre-Whitewood world.
Prior to the legalization of same-sex marriage, it was not uncommon for same-sex couples to go through an adult adoption. This was the only method available to them to create a legal family unit. By one partner adopting the other, couples were able to enjoy some of the protections and benefits only available to families. One of those benefits was a reduction of inheritance taxes. Prior to the Whitewood ruling, when one partner of a same-sex couple died, the other partner would have to pay 15% inheritance tax because the surviving partner was simply viewed as “other heir” under the tax code. Imagine paying 15% tax on assets you helped acquire during your relationship, while married heterosexual couples were taxed at 0% on the same inheritance. By adopting one’s partner, same-sex couples created a legally recognized family unit and reduced inheritance to the 4.5% of lineal heirs. While a vast improvement, the solution was far from perfect.…
Continue Reading Legalization of Same-sex Marriages in Pennsylvania Causing Adoption Reversals
According to Ron Swanson of Parks and Recreation fame, “the three most useless jobs in the world are, in order, lawyer, congressman, and doctor.” While Ron Swanson may be my favorite television character of all time, I, of course, beg to differ with this assessment.
The above quote comes from Season 6 of Parks and Recreation, and the context is a discussion about the value of having a Will drafted by a lawyer. Ron proudly presents his Will which was handwritten by himself at age 8 on a yellow piece of notebook paper.
The Will states:
Upon my death,
all of my belongings shall transfer
to the man or
animal who has
[several weird symbols that only the man who kills him will know]
The burning question: would Ron’s Will be enforceable in Pennsylvania?…
Continue Reading Is Ron Swanson’s Will Valid in Pennsylvania?
There are a lot of misconceptions and different definitions for a Notary. In drafting this blog post I found several different definitions, including one from Google that says a Notary is “a person authorized to perform certain legal formalities, especially to draw up contracts, deeds, and other documents for use in other jurisdictions.” Wikipedia says “[a] Notary is a lawyer (except most of the United States).” Neither of these are true in Pennsylvania. So what is a Notary? Why do you want something notarized?…
Continue Reading What is a Notary?
As you update your Facebook page, have you ever wondered how your beneficiaries could obtain access to your “digital assets” upon your death? Indeed, could they access your digital assets if you were incapacitated during your lifetime? Prudent people plan through financial powers of attorney for incapacity during lifetime, or for the disposition of their …
I often hear people say they need to do "their will" when they refer to estate planning. Of course estate planning involves making a will, and most people see the will as the most important aspect of estate planning. Choosing to establish a power of attorney, however, may be the most important decision that a person makes when creating their estate plan. The person who is giving the power of attorney is known as the principal. The person to whom the power of attorney is given is referred to as the agent. Although the law has many provisions to protect individuals from unscrupulous agents, the damage an untrustworthy agent can do may be difficult or impossible to fix, and it directly affects what is left when a person passes away that can be given to beneficiaries under their will.
The duties Pennsylvania’s Probate, Estates and Fiduciaries Code places on an agent is to act as a fiduciary, or a person who must act with a high standard of care for the benefit of another, to the principal. What this specifically means is that the agent must:
1. Act for the benefit of the principal;
2. Keep the agent’s money and other assets separate from the principal’s;
3. Exercise reasonable caution and prudence when acting on behalf of the principal; and
4. Keep accurate records and receipts of deposits, withdrawals and deposits.
Choosing the right agent who will dutifully follow the law is critically important because powers of attorney in Pennsylvania are generally durable, meaning they continue to have effect when the principal becomes incapacitated or disabled. Therefore, your agent must act for your benefit in handling your financial affairs when you are no longer able. Your agent will have full access to your bank accounts, stocks and other property.