Real Estate Attorneys - West Chester, Pennsylvania

FAQ

Why do I need a will?

So if you die property will be given to those you have selected, not those mandated by the intestacy laws. The problem is not what you see in some advertisements, e.g., that the government will take your property or even, except in the most literal sense, the government will select those who will be given your property. A typical case might involve a wife who needs all of her husband’s to care for herself and to raise their young children. But the intestacy laws give her only a part of those assets and the rest to the children where it is in most circumstances unavailable. A properly drawn will would have given it all to the wife.

How are estates taxed in Pennsylvania?

There is no tax on property left to spouses and taxes of 4 1/2%, 12% and 15% on property left to children, siblings and others. There is no exemption. But a few things, insurance among them, are not taxed at all.

How are estates taxed by the federal government?

Again no tax on what is left to spouses. But a very heavy tax on anything is left to anyone else, probably in the 40% to 50% range depending on the enthusiasm of the day for taxing the rich. But there is a huge exemption, 3 1/2 million dollars, which apparently will hold for the time being at.

What is estate planning?

Estate planning is what you do to make sure your estate goes to those you would have it go to and in the form you think best and usually to minimize taxes. Obviously you name those to whom you would give your assets, e.g., to my wife or "to my children in equal shares". Sometimes you will wait to arrange it so your heirs do not get their gifts all at once, maybe one-third at 25, one half at 30 and the balance at 35. Sometimes you will want to make sure your gift does not make an heir ineligible for a government program the heir is receiving payments from. And, of course, there is what most people think is the heart of estate planning, avoiding taxes. Sometimes this involves gifts to heirs (gifting as the trade calls it), sometimes-special sorts of trusts, etc. With a little artful planning, a mother and father can leave seven million dollars to their children without paying any of the federal estate tax. And with a little better planning, they can leave more.

Can you leave your 3 1/2 million dollar
exemption to your spouse?

No. If you die without using it e.g., if you leave all your property to your spouse and do not use that exemption, it dies with you. But with certain trusts you can do something very much like leaving it to your spouse and taking advantage of the spousal complete exemption from taxation and the 3 1/2 million dollar exemption for other heirs.

Does a power of attorney stay in effect when you die?

No. But a durable power of attorney stays in effect even if you become unable to revoke it, by illness or even incompetency.

Can you easily get information from physicians and hospitals on your spouse’s treatment and condition?

Not always. Some now require that you be designated by your spouse as one to receive that information. We put that in an advance health directive and living will.

1. Estate Planning: Make sure your property will go where you want it to go to and whom. Avoid taxes.

2. Estate Administration: Let us help guide executors through administration, i.e. payments, collections, tax returns, accounts, etc.

3. Estate Litigation: Sometimes you simply have to be in court. We will represent you.

4. Wills: These are of course the fundamental planning documents and should be put together exactly as each person's individual situation demands.

5. Trusts: In some circumstances it is helpful to have one person or institution hold something for the benefit of another person.

6. A & B Trusts: Make sure all exemptions are used.

7. Crummey Trusts: Make gifts and still say what they have to be used for.

8. Special Needs Trust: Don’t let your bequests make your loved one ineligible for government assistance otherwise available.

9. Insurance Trusts: Don’t let the federal estate tax take your insurance benefits.

10. Marital Trusts: Spouses usually do not pay death taxes.

11. QTIP Trusts: Sometimes second marriages need a sort of compromise between the needs of spouses and children.

12. Powers of Attorney: Someone to act for you when you cannot act for yourself.

13. Advance Health Directives: Naming your surrogate for medical decisions.

14. Living Wills: Deciding what you want done if your illness is terminal.

15. Gifts: Most gifts don’t have to be taxed.