Estate Planning and Administration Services
You have worked hard to make life easier for your family. The Business Team at Smigel, Anderson & Sacks will guide you through the maze of estate planning vehicles and create a plan to maximize the value of the assets you will pass on to your heirs. Monetary gift giving strategies, education savings vehicles and charitable trusts are just a few ways you can divert your well-deserved savings into estate tax-reducing options. We offer estate planning services that include:
- Wills and Trusts
- Charitable Trusts
- Living Wills
- Powers of Attorney
- Family Limited Partnerships
- Inter Vivos and Testamentary Trusts for Beneficiaries
- Education Savings Vehicles
- Monetary Gifts
- Life Insurance Trusts
Basic estate planning concepts apply to all married and unmarried couples. A Last Will and Testament allows a person to appoint beneficiaries of their estate as well as to disinherit beneficiaries. It will allow a person to appoint a personal representative, which is a person who will handle the final affairs and administer the estate to completion. A Will is also important in that it allows for the appointment of guardians for minor children as well as other beneficiaries that may require special management of funds. Likewise, the Last Will and Testament is a very important document in which one may designate his or her instructions regarding funeral or burial arrangements.
Revocable Living Trust
A Revocable Living Trust can also be used to dispose of one’s assets. With a Revocable Living Trust, you, the settlor, transfer all of your assets into the name of the trust during your lifetime. While you are alive, you are the Trustee of your own trust and may buy, sell, revoke, or amend the trust at any time. Upon your incapacity or death, a successor Trustee is appointed to handle the administration of the trust.
Upon death, the successor Trustee will act much like a personal representative in an estate and administer the trust by ensuring that all your debts and taxes are paid and that the trust assets are distributed to the beneficiaries designated in the trust agreement. The advantage of the Revocable Living Trust is that it is not a document that is placed of public record like a Will. A Revocable Living Trust is less likely to be challenged like a Will contest could if disapproving family members dislike the dispositive provisions. It is important to remember whether one has a Will or a Revocable Living Trust, those documents will only dispose of assets that are in your individual name. The Will or Trust will not control the disposition of jointly owned property, which will pass to the joint owner upon the death of one. They will also not control the disposition of life insurance contracts, IRAs or other retirement plans which name specific beneficiaries, unless of course the estate or trust is named the beneficiary of those funds.
Durable Power of Attorney & Living Will
Two final components of any good estate plan are a Durable Power of Attorney and a Living Will. A Durable Power of Attorney is a written document that you sign during your lifetime giving another person the authority to act for you with regard to your finances and/or health care. The Durable Power of Attorney is useful for purposes of asset management and personal decision making. A Durable Power of Attorney can take effect immediately in the name of convenience or it may take effect upon a triggering event which is typically your disability or incapacity.
A Living Will is a written declaration evidencing your feelings about extraordinary life sustaining measures. After Terry Schiavo’s ordeal, the importance of Living Wills has been highlighted. Most often times, a Living Will is written to express to family, friends, physicians or anyone interested in your care, your feelings about heroic life sustaining measures if you become in a permanent state of unconsciousness with no reasonable likelihood of survival. The Living Will may also state the opposite, which is that heroic measures and life sustaining treatment should be applied if you are in a permanent state of unconsciousness and terminal. In the Living Will, you can appoint a surrogate, or specific person who will be in charge of making those types of decisions. Without doing so, the law permits the next of kin make such decisions.
We can assist you in the following related areas:
- Sophisticated techniques to protect assets
- Long Term Care Issues: when do you need Long Term Care Insurance?
- How gifting can reduce your tax liability
- You Need to Know
Pennsylvania Inheritance Tax
Pennsylvania assesses an inheritance tax on the value of property passing to your beneficiaries. The Pennsylvania inheritance tax rate on transfers of property to a spouse or qualified charity is zero (0%) percent. It is four and one-half (4 1/2%) percent on transfers to children, parents, grandchildren, grandparents, or anyone in the line of ascent or decent, twelve (12%) percent on transfers to any others. A domestic partner will have to pay a fifteen (15%) percent inheritance tax rate on any property passing to him or her.
Federal Estate Tax
The federal estate tax, unlike the Pennsylvania inheritance tax, is based upon the value of your assets owned at death. Each person may pass $5 million of assets (indexed for inflation) to their heirs or beneficiaries free of federal estate tax. To the extent your estate exceeds $5 million in those years, you will pay federal estate tax on the excess.
Utilize the annual exclusion. In 2014, each person may gift up to $14,000 to any one person per calendar year without incurring any federal gift tax. Gifting is an excellent way to transfer wealth to others. To the extent gifs are made in excess of $14,000 per person per calender year, the excess amount may be subtracted from your lifetime exemption amount. Therefore, rather than passing $5 million to your heirs free of federal tax, you may pass something less based on the value of the excess gifts that you made during your lifetime. (The annual exclusion is indexed for inflation each year.) Also, in addition to the annual exclusion, one may pay for the medical and educational expenses of another provided those expenses are paid directly to the medical or education provider.
Someone, probably a family member or close friend, has paid you one of the biggest possible compliments and created for you a significant responsibility at the same time. They have entrusted you with carrying out their final wishes. Like most of us, you are honored but also anxious about your ability to get the job done. The task can be overwhelming and it will need to be done at a time when you are emotionally impacted by your loved one’s death. Smigel, Anderson & Sacks, with its attorneys and specially trained estate paralegals, is here to help. We can guide you through the process.
“Among the duties of the personal representative following his appointment and the grant of letters are an examination of the decedent’s papers and a search for the assets and liabilities of the estate”
(Pennsylvania Fiduciary Guide §6.1)
We can help you identify assets:
- Bank Accounts
- Brokerage accounts
- Real Estate
- Household goods
- Business interests
- Safety deposit boxes
- Insurance policies
We can assist in the payment of the decedent’s final bills, liquidating estate property and processing medical and insurance claims.
- Arrange for entry into safe deposit box
- Apply for tax ID number
- Preparation of inventory
Within Three Months of Death:
- Make payment of estimated PA inheritance tax to obtain 5% discount
Within Nine Months:
- File PA inheritance tax return or apply for extensions
- Pay balance of PA inheritance tax to avoid interest charges
- File copy of federal estate tax return
We will prepare and file Pennsylvania inheritance tax, federal estate tax, final income tax and fiduciary income tax returns. Our experienced attorneys can address and resolve disputes between estate beneficiaries. At the end of the administration process, Smigel, Anderson & Sacks will work closely with you to finalize the estate with a Family Settlement Agreement or a Court Accounting.
In the event that the death of the loved one is caused by the negligence of another, Smigel, Anderson & Sacks can provide professional services to obtain monetary damages after investigating and resolving the claims of the estate, the family and their heirs. Typically, these claims come about as the result of automobile accidents, medical malpractice and other negligent acts. These services can be provided on a “no recovery – no fee” basis. The right to pursue such a claim generally rests with the person appointed to administer of the estate, who is the Executor or the Administrator. We welcome the opportunity to serve you in your time of need. Please call for a no obligation appointment to discuss your options.
We can assist you in the following areas:
- Sophisticated techniques to distribute assets
- The best strategies to liquidate residence or vacation home
- Out-of-State property issues
- Tax and estate planning for survivors/successors
- Legal issues that may remain after death: auto accident, asbestos, silicosis, insurance company demands
Send us a Message
We understand if you don’t have the time to make a phone call, are just looking for some general advice or want to quickly register for a seminar. Don’t hesitate to send us a message, we’ll get back to you as soon as possible!
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