Who Cares About Probate?

When it comes to probate, living in Pennsylvania saves you time and money.  Unlike some other states, Pennsylvania does not have a probate process that is time consuming or costly.  How does that compare to India? 

I will reach out to local Indian counsel regarding their views on this question and many others throughout the course of my Journey to India and share their answers with you.

Journey To India: Bucks County Estate Planning Attorney Compares Probate, Trusts and Wills in India with U.S. laws

With its diverse religions and cultures, India is an ideal country in which to examine varying estate planning practices.  My study of these practices will enhance my knowledge and skills as an estate planning professional.

Join me as I explore this multifaceted country with practices that are intriguing, serene and diverse.  First stop is New Delhi.  Over 11 million people, of the 1.2 billion people of India, live in New Delhi.  For perspective, the population of U.S. is 317 million with just over 8 million in New York City and 1.5 million in Philadelphia.  Let's just say, New Delhi has lots of people who need Wills, Trusts and other estate planning.   

New Pennsylvania Power of Attorney Law

If you have not already done so, now is the time to get your Power of Attorney. Pennsylvania has adopted a new Power of Attorney law and many of the sections affecting the Power of Attorney form take effect January 1, 2015.

The changes to the Power of Attorney form itself include an updated notice for signing by the principal, the person making a Power of Attorney, and an updated acknowledgement for signing by the agent, the person appointed to serve on behalf of the principal. In our office, alongwith the principal signature, we require the signature of two witnesses before a notary. Under the new law, it is now a requirement. Finally, certain powers, such as the power of the Agent to make a gift or change a beneficiary designation, must now be specifically set forth in the document otherwise the agent does not have the power to perform these acts and others as listed under the statute.
　

Other than the requirements of the form, the new law addresses third party recognition and reliance on the Power of Attorney. If a third party (such as a bank) relies upon a properly prepared Power of Attorney document, the third party is immune from liability if it later turns out that the document is invalid. Often representatives of banks or other institutions refuse to recognize a Power of Attorney because it did not fit the form preferred by the bank or institution though such form had been prepared by the customer’s attorney.
　

The problem that still persists is that a bank representative or other party being asked to accept a Power of Attorney may request an opinion of counsel that the Agent is acting within the scope of authority granted under the Power of Attorney document. This could prove to be a burdensome requirement for the customer and will generally be addressed on a case by case basis until this is no longer a requirement.   

Contact us at 215-321-4033 for further information.

Today, It's Your Legacy

An important benefit of Estate Planning is creating a legacy.  Treasure your life's journey share your story or your family's story with us.  Be the next Guest on our Show, Today. It's Your Legacy or be the client spotlight in our newsletter or Facebook page.  Post your comment below for our consideration.

Ten Years of Making A Difference in the Lives of our Clients

                                              Thank you for your support over the years. 

I choose Estate Planning because it allowed me to reach those who needed professional service at an affordable price.   We successfully help individuals, families and businesses plan for the people they love.  We focus on all aspects of our client’s life – their personal assets, business assets and more importantly their dreams for the future.

For 10 years, we have cared to listen to our clients and exceed their expectations and we look forward to another decade of outstanding service in probate, estate planning, guardianship, business succession planning and elder law.

Making a Difference

We have just celebrated the MLK Holiday with a day of service for many across the nation.  Carolyn Newsom, an attorney and intern at my office, recalls her father saying “we have a responsibility in life to put more jelly beans back in the jar than we take out.”   She expressed that “it was his folksy way of saying that we have a duty to serve others and to help make the world a better place in which to live.”

As evident in the rise of volunteerism, many others would agree with this “folksy” expression.  In honoring Martin Luther King, Jr., many organizations sponsored not only parades, speeches, panel discussions but also projects to clear vacant lots, help rehab a housing unit or plant a garden for a homeless shelter.  We have witnessed volunteers who helped victims of Sandy and other devastations.

 In addition to volunteer efforts, many people give their financial support.  With proper planning this support can also have a lasting impact.  Make charitable contributions a part of your estate plan which can establish the basis for continuation of your dream.

Federal Estate Tax

The American Taxpayer Relief Act which was signed into law on January 2, 2013 provided “permanent” (unless continued political debate over the federal budget result in further changes) rules that create a  more predictable environment for planning and decision making.  As pertains to the Federal Estate Tax the following is now in effect:

1.      Who has to pay federal estate tax?  If your estate is in excess of $5 million dollars (excess of $10 million for couples), the federal estate top tax rate would be 40%.  Your estate will not be subject to federal estate tax if your estate falls under these limits.

2.      Do spouses have to pay the tax when they inherit from each other?  The unlimited spousal deduction from estate tax still applies under the new law.  Though there will not be a tax upon the death of the first spouse, the tax would apply at the second spouse’s death if the estate exceeds the limits noted in the first question. 

3.      What is the status on lifetime gifts?  The federal estate gift tax exemption is the same as the federal estate tax, $5 million dollars, indexed for inflation. The 2013 exemption is $5,250,000.  Gifts in excess of the limit will have a top tax rate of  40%.  In 2013 you can give up to $14,000 to as many individuals as you like and this does not require filing of a gift tax return.    

Health Care Expenses

I was reading an article recently in an AARP publication that experts now estimate a couple aged 65 will need nearly $250,000 in addition to Medicare, to pay for future medical costs.  This amount is much higher if nursing home care is ever needed.  More importantly, if planning is not done, children could be held responsible for their parents’ long term care debt.

Approximately 25% of seniors will spend some time in a skilled nursing facility and Medicare benefits for these services are conditional and time limited.  Therefore, the options for payment are, private pay (if you have the money), long-term care insurance (if you purchased when younger and healthy) or Medicaid.  Medicaid is only available to those eligible for the benefit.  An individual or couple is required to spend down assets to apply for Medicaid.      

In a recent case, the court held that a son was liable for his mother’s nursing home bill under Pennsylvania’s Filial Support law.  This law is not new but was rarely used to go after children.  Financing healthcare and protecting your estate can be complex.  Minimizing your risks requires planning and proactive action that should start with a comprehensive estate plan. 

Is Your Will “Fair”?

When it comes to your children, should everyone be treated equally? 

Sometimes parents have a difficult choice to make when writing a will.  One child may be financially successful and secure.  Another child could have a low paying public service job.  There may be a child with special needs or a child who is unable to manage finances responsibly.  While there may be good reasons to differentiate between children, unequal allocations of an estate can strain sibling relationships and create unintended ill will in the surviving family. 

So, what is fair?

Family dynamics differ.  The amount of assistance provided to children during life time maybe unequal.  The amount of care provided by one child for an aging parent can further complicate the challenge. 

 

So, what is fair?

Have you considered meeting with your children to explain your wishes and obtain agreement or, at least, understanding?   Unless you have discussed with your children any unequal distributions, I highly recommend equal distribution under your will.

Aftermath of a Hurricane or the Perfect Storm

I was talking to my Dad a couple of days before Hurricane Sandy (reduced to a storm at that time) was due to hit our area in Pennsylvania.  He had already referenced it as the perfect storm with 3 weather systems colliding, this time on land.  These perfect storm scenarios have happened out at sea but rarely on land.  But, here we all were waiting on land for the collision.

Though we were without electricity for 5 days, it was nothing compared to those who are still without electricity, have severely damaged homes; have no homes to go to; or, have loss loved ones in the aftermath of a perfect storm.  Many of us ask, how can we help?  What can I do? 

I was moved by my friend's story.  Though still without power in New Jersey, she was able to obtain a generator to use sparingly since probane was not easy to obtain.  She has now taken in a 94 year old and 91 year old couple who live in her neighborhood and has offered another spare room to her neighbors without power. Yes, in each of our own way, we can reach out to help. We do not have to wait for direction or permission or some organized venture. What can you share!! What can you give!! Answer and move on it!!

Felice Vazquez, 40, of Hoboken, greets a neighbor as she mans a table providing hot drinks and snacks on Washington Street as the buildings around them remain without power due to damage caused by Superstorm Sandy, Nov. 4, 2012, in Hoboken, N.J. (John Minchillo/AP Photo )

A good samaritan provides electricity for storm victims to charge electronic devices on 11th Street, Oct. 31, 2012 in Hoboken, N.J. (Jeff Zelevansky/Getty Images)

Workers try to clear boats and debris from the New Jersey Transit's Morgan draw bridge, Oct. 31, 2012, in South Amboy, N.J. (Mel Evans/AP Photo )

 

People line up to fill gas containers at the New Jersey Turnpike's Thomas A. Edison service area, Oct. 31, 2012, near Woodbridge, N.J. (Mel Evans/AP Photo )

People wait to use a pay phone on Bright Beach Avenue, Oct. 31, 2012, in the Brooklyn borough of New York. (John Minchillo/AP Photo )

 

Vidal Gore Dies at 86

The author, playwright, politician and commentator whose vast and sharpened range of published works and public remarks were stamped by his immodest wit and unconventional wisdom, died Tuesday at age 86 in Los Angeles. 

Vidal Gore was revered by many throughout his varied and vast career.  His legacy included hundreds of essays, the best-selling novels “Lincoln” and “Myra Breckenridge” and the Tony-nominated play “The Best Man,” a melodrama about a presidential convention revived on Broadway in 2012.

How will you be remembered?  Contact us at www.ythlaw.com for all your estate planning needs.

When sending your Child to College a Power of Attorney is a Must Have!

If you have a young adult (18 or older) or you are a young adult, it is important to have powers of attorney in place.  Parents are often surprised that they do not automatically have access to their child’s healthcare information or other college records.  If your child is in an accident, you do not want to go through red tape to address their health needs.  But, that is what will happen if the right documents are not in place.  

As a young adult, you want to have someone you trust and who cares about you available to handle your health issues and other affairs if you are in a car accident, have a serious sports injury or experience some other traumatic event.  Your medical information can only be shared with the person you designate.  Prepare for the unexpected to assure the road to recovery does not take a detour. 

Here are some answers to your important questions. 

When does an agent sign the power of attorney? The agent does not have to sign at the time that you sign your power of attorney. The agent's signature does not have to be notarized only your signature. Your agent signs when you are in need of their help. 

How do you revoke an agent's authority? You should maintain your original powers of attorney. If you no longer want a person to serve as your agent, then the powers of attorney should be destroyed and new ones entered into. If your agent has an original power of attorney, then you must get it back and destroy it. Otherwise, you have to inform those individuals who may rely on the power of attorney that you have revoked your agent's authority. ALWAYS appoint someone whom you trust.

Springing Power of Attorney.   There is another type of power of attorney referred to as a springing power of attorney. It can only be used if a doctor has certified your incapacity and such certification must be attached to the power of attorney for it to be effective. The springing power of attorney is revoked once you regain capacity.

Call me today and I'll get your child's Power of Attorney done before they leave for school.

Selecting a Guardian Might Come With Some Drama

Just before the news broke regarding the guardianship of Michael Jackson’s children, I received this question.  Can the selection of guardian for minor children withstand a legal challenge by the grandmother?   In this particular situation, a non-relative was chosen by a couple as the guardian of their children.  The wife’s mother was not pleased when she found out her daughter’s decision. 

Selecting the guardian for your minor children is one reason for having a Will.  Even though your selection could be challenged (it’s the American way), it does not mean it will be successful.  The courts generally uphold the appointment of the guardian selected by the parents. Any challenge would have to allege and demonstrate that the guardian selected is unfit or unable to properly care for the children.  The court considers what is in the best interest of the child.  Status as a relative is not a controlling or determining factor.  A grandmother does not have a legal right to override the parents’ selection merely because the grandmother prefers to serve or have a relative serve as guardian.  Parents are generally in the best position to determine who would be in the best position to care for their children.   

That being said, it is wise to have conversations regarding guardianship with those whom you know will be upset with your selection and work through those issues during your lifetime.  Further, you should update your selection as circumstances change, including aging, financial stability and interest.  It is not in your child’s best interest for them to be embroiled in a legal battle when they have already lost so much.

The Importance for the LGBT Community to Engage in Estate Planning…

It is just as important, if not more important, for

couples of the same gender to engage in estate planning.

I was talking with a CPA specializing in estate planning about the unique tax issues that arise in domestic relationships. Specifically, she expressed that couples of the same gender, unlike married couples, have no IRS exclusion for property or monetary transfers between them. Such transfers could be subject to gift tax and transfer tax. If there are significant assets involved in a separation betweencouples of the same gender, even if the financial provider wanted to be fair with property division, the tax consequences may be prohibitive. After the lifetime exclusion of 5 million, which may go back to 1 million, the excess will have a gift tax imposed. The maximum gift tax rate in 2012 is 35%, and it may be raised in later years. The gift tax rate is a hefty tax for anyone to pay.
To the extent you can address tax situations as well as protect your relationship, cohabitation/domestic partnership agreements are advisable. They are particularly beneficial in the following situations:

1. when a second person's name is added to a deed after considerable equity has already been established in the home during ownership by the first owner. The agreement will help clarify ownership interest in the real estate.

2. when property purchased jointly is only held in one person's name

3. when one person is the financial provider and the other is a homemaker

4. when unequal contributions are made towards the purchase of jointly held property

5. when there is an interest in giving benefits or rights to another that are not required or available under the law

6. when assets are co-mingled or combined

7. when there are family members who may dispute the interest of a domestic partner.
It is always wise to have an agreement between couples of the same gender. There are many situations that we can not anticipate, and having an agreement in place is always helpful.

Call me today if you have questions pertaining to Estate Planning for the LGBT Community

Dark Knight Rises - Aurora, Colorado

President Barack Obama hugs Stephanie Davies, who helped keep her friend, Allie Young, left, alive after she was shot during the movie Aurora movie theater shootings in Aurora, Colorado.

When I heard about the tragedy Friday morning the 20th, my heart went out to all the families directly affected and all of us who can only imagine the pain.  We can not allow such senseless tragedy to take over even our simple pleasures. 

This pass weekend my family gathered to celebrate my mother's 76th birthday.  Of course, one of our usual outings with the children during these festivities is going to the movies.  But, naturally, we took pause as the Aurora tragedy continued to unfold.  No one was up for a midnight Batman so Spiderman won out.  Those going to the movie were much more vigilante in assessing their surroundings.  But, come on, is this how we must live our life?  Can we, as a people, as human beings, figure out how to take back control over the simple act of going to the movie with your children? 

I ask because I do not know the answer.  I blog, I tweet, I facebook, I ponder!!

Planning Ahead - Get Your Affairs in Order

Woody Allen is credited with saying, “If you want to make God laugh, tell him your plans.”  I would be the first to admit that we certainly aren’t in control of as much as we’d like to think we are.  So, in my estate planning with clients, I like to take a look at where they have been.  That is the back story, the legacy piece that we ALL have and that keeps my work interesting, intriguing and varied.

More than plan, I create a map, of sorts, for my clients.  The future has many twists and turns, alternative routes, hills and valleys.  Our estate planning "map" could include Wills, Trusts, Powers of Attorney, Gifting, etc.  It provides for our intentions BUT allows the details to unfold in accordance with the universal principles.  The estate planning  "map" for each client has flexibility and often is updated with changing circumstances.

Once we have our  estate planning "map" which details our wishes, needs and desires, we can focus with clarity around our intent and accept that the details are not within our control, only our intentions.  Contact us at www.ythlaw.com

A Will Serves Many Purposes

On this hot, 97 degree day in July, I share with you this hot tip.  Really, truly, for the most part, none of us know how we might die.  We know we will die, but not when or how.  So when folks say "I do not need a Will, I have "nothing"," I share this story.

A young man's mother was killed in an automobile accident.  The other driver ran a red light going at a high rate of spend in his deliver vehicle.  He survived with minor injuries and was declared to be at fault.  He was sued by the son for wrongful death of the mother.  The insurer for the driver's fleet of deliver trucks settled the suit for excess of $900,000.  Though the mother had "nothing" her estate now is worth $900,000.  Who gets her assets?  She was estranged from her husband for 17 years (never divorced) and she had 3 children (her son with whom she lived, a daughter with drug issues and another daughter who died leaving her only grandchild).

The intestate law would distribute the estate to the husband, son and daughter.  The grandchild would not be entitled to any of the estate.  Is this the result that would have been intended if a Will was done?

Contact us at www.ythlaw.com for your probate, estate planning and elder law needs.

Beneficiary Designations are Important

I was recently working on an estate matter which demonstrated the importance of updating and keeping track of your beneficiary designation.  Many of our seniors obtain life insurance to provide for their funeral.  However, the person designated as the beneficiary does NOT have to use the monies for the funeral.  They could choose to keep the money for their own benefit.  

In this case, the person designated her brother as the beneficiary under her life insurance policy.  He had agreed to use the money to take care of her funeral expenses.  Since he WAS her closest living relative, he would not have to come out of pocket to bury his sister.  WELL, her brother predeceased her and her secondary beneficiary was her niece (her brother's daughter) who did not have the same interest as the decedent's brother.  The niece wants to use the insurance to purchase a house and is only willing to provide some funds towards a funeral.  What is to be done?  Either the other family members will have to all contribute towards a funeral or there will be a cremation or an inexpensive service, less than what would have been affordable with the insurance proceeds. 

SO, keep your beneficiaries up to date BUT more importantly it would be better to just prepay your funeral and not depend on others to use insurance proceeds in your best interest.  Contact us with your estate planning, probate, guardianship, and business succession planning needs at www.ythlaw.com

Prenuptial Agreements and the Business Owner

I was talking with a new business owner.  He just purchased a service station and was so excited about this new venture.  He had worked in the business since high school and so was quite sophisticated in business matters at such a young age of 29.  He had also met the love of his life on an on-line dating service.  Now, his dilemma is he wants to get married but does not want to have his business part of the assets of this new union.  Not a problem at all with the use of a Prenuptial Agreement.

A business owner may want to protect his exclusive rights to the business if the marriage fails, as in the case for this business owner, or control the diposition of the buiness after his death, ie. for parents or the child of a prior marriage.  For purposes of best practices, the following should always be consider and done:
1.  Make sure it is voluntary and not done under duress.
2.  Make a fair financial disclosure.
3.  Share the proposed agreement well before the wedding and even before the wedding date is set.
4.  Demonstrate some fair negotiation if one party clearly is less well off than the other.
5.  Each party should have their own counsel even if one has to pay for the others.
6.  Fairness should be demonstrated in the process when their is an economically weaker party.

Contact us for all your probate, guardianship, estate planning, business succession planning and prenuptial agreement needs at www.ythlaw.com.

I am back to my blogging.  I started answering questions posted on AVVO.  As a result, I did not blog as much.  However, I think the information shared blogging helps people i n their quest to understand the world of estate planning.  AND so, I am back and will be posting more and more informative blog posts for you and your family. 

Today, I mentioned the importance of a Special Needs Trust to supplement funding to those with disabilities on governmental assistance.  Specifically, I am looking at the type of Special Needs Trust referred to as third party funded trust.  These are trusts that do not hold monies of the disabled person but money of one who wants to care for the disabled person, a parent, grandparent or other relative.  If you provided these funds directly to the disabled person, then their benefits could be affected.  You do not want to have that happen.  So look into creating a Special Needs Trust at your earliest convenience. 

We are here to help at www.ythlaw.com