Estate Planning 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.
Choosing A Harrisburg Estate Planning Attorney
If you’re looking for a Harrisburg Estate Planning Attorney, Smigel, Anderson, and Sacks is the right law firm for you. We handle each case in accordance with the highest legal and ethical standards, and all client matters are held in the strictest confidence. We understand that the need for legal representation is frequently accompanied by anxiety; and our attorneys and staff are sentitive to these needs, and stand ready to respond to your individual concerns. We’re happy to set up an appointment to be your Harrisburg Estate Planning Attorney. Call us with a date in mind, or use the forms to shoot us a quick message and we’ll reach out to you!