Estate Planning Lawyer, Pittsburgh PA | Elder Law | Jenco Law
Wills, Trusts, Estate Administration Probate Attorney Serving Pennsylvania
Estate Planning allows individuals and families to clearly identify what will happen to their assets when they die. Most families put off estate planning as they are “too busy”, “too young” or don’t believe they have enough assets to be considered “an estate”. Truth is – everyone is going to die at some point, everyone has an estate, and you are never too young to engage in estate planning. Jenco Law Group, P.C. offers affordable estate planning options and we do all of the legal the work, so you can concentrate on what matters most – your family, career, and kid’s events.
Pennsylvania estate planning laws and strategies change more often than you might think — and it is extremely important that estate planning and trust attorneys in Pennsylvania stay informed and innovative. Numerous changes take effect every year or so and not keeping abreast with these changes can have a long-lasting impact on your asset protection plans. It is vital to keep up-to-date with your estate planning mechanisms and here at Jenco Law Group, P.C. we help our clients do just that. Our firm keeps our clients informed and, most importantly, protected from short-term and long-term mistakes. Please contact our firm to ensure your estate planning is correctly in place with the right strategies and correct documentation.
What is a Will?
In Pennsylvania, a will is an instrument by which a person makes a disposition of property to take effect at death. The will should address all a person’s property, not just what is located in Pennsylvania, but also accounts and real property no matter where else located. A will can be “simple”, which means that it simply says all assets that you own pass to someone else. A will can also be more complex, such as forming a trust for a minor child. If you have a minor child, a simple will is not satisfactory, as a minor child cannot accept the inheritance. A will should clearly reflect your personal priorities, wishes and values.
What is a Simple Will?
A Simple Will is a will that does no tax or asset protection planning.
What is a Trust?
At its most basic level, a Trust is an arrangement where one person (Trustee) holds some asset for the benefit of another person (Beneficiary). Trusts can exist in a Will, called a Testamentary Trust, coming to life only upon the death of the person who created the Will. A Trust might also be formed while you are alive. Trusts can be Revocable (sometimes called a Living Trust) or Irrevocable. Trusts can be Complex or Simple. Trusts can be crafted to address very specific sets of circumstances, such as for funding education for grandchildren or to assist a person with Special Needs.
What is a Revocable or Living Trust?
A Living Trust (also called an inter vivos trust) is created by a living person and is effective during the grantor’s lifetime to the extent that assets have been put in the name of the Trust. If the Trust is a Revocable Trust, even after transferring assets into it, the grantor retains full control of the assets, and can revoke or change the Revocable Trust at any time during his or her life. If it is an Irrevocable Trust, the grantor gives up the ability to change the terms but will typically realize a substantial benefit, such as reducing taxes, obtaining Medicaid coverage for long term care, or protection of assets against outside claims. Property transferred into a Living Trust does not have to go through probate and may be distributed to your chosen beneficiaries or even held in a continuing trust after you are gone.
Is a Revocable Living Trust Right for Me, as a Resident of Pennsylvania?
A Revocable Living Trust can be an excellent estate planning tool, but for most Pennsylvania residents the cost of creating and implementing a Pennsylvania Revocable Living Trust might not be worth the expense.
What is an Inter Vivos Trust vs. Testamentary Trust?
An Inter Vivos Trust refers to a trust formed during your lifetime, as opposed to a Testamentary Trust (a trust formed at your death). Inter Vivos Trusts can be Revocable Trusts or they can be Irrevocable Trusts. A typical example of an Irrevocable Inter Vivos Trust in Pennsylvania would be the formation of an Irrevocable Life Insurance Trust.
What is an Irrevocable Life Insurance Trust?
An Irrevocable Life Insurance Trust (or ILIT) is an Inter Vivos Trust formed for the specific purpose of holding a life insurance policy (or policies) on your life. The typical goal is to remove the life insurance from your taxable estate. At your death the policy pays out to the trust, which benefits your spouse and children, but the policy is neither part of the Federal Taxable Estate, nor part of your Pennsylvania Probate Estate.
What is an Education Trust?
An Education Trust refers to a trust set up for the sole purpose of paying for the beneficiary’s education. The trust can pay for only tuition, or it could pay for any or all expenses of the beneficiary’s education. When adequately funded, these trusts can pay for the education of your descendants for hundreds of years. Perhaps a great-great-great-great Grandchild of yours will toast to your health because of his or her tuition being paid from your Pennsylvania Education Trust?
What is a Spendthrift Trust?
A Spendthrift Trust refers to a trust whose terms limit the beneficiary’s creditors from successfully making claims against the trust. A Pennsylvania Spendthrift Trust is a perfect tool to protect any beneficiary of yours that regularly has creditor problems. The trustee is usually authorized to use the trust assets “on the beneficiary’s behalf”, which means pay the person’s bills. Those payments are made free of creditor claims. A Pennsylvania Spendthrift Trust can also be a safe haven even for those who do not have regular creditor issues. We all live with the possibility of an unexpected lawsuit or a financial downturn.
What is a Special Needs Trust?
Though it seems that medical science has found a way to cure most of life’s illnesses, there are still many people who suffer from physical and mental diseases that make Medicaid necessary. If you were to leave a Pennsylvania Special Needs person an inheritance, that inheritance might disqualify them from Medicaid or any other financially based government program. A Pennsylvania Special Needs Trust can literally be a lifesaver.
What is a Trustee?
The Trustee is the Fiduciary responsible for carrying out all the terms of the Trust.Every Trust requires a trustee. For a Living Trust the grantor often serves as the trustee during his or her lifetime. However, a trustee can be an individual or institution, such as a bank or trust company. A trustee must be carefully chosen in order to protect your wishes.
What Does the Executor Do?
The Executor is the person named in the Will who will be responsible for carrying out the Will’s terms.The Executor is responsible for collecting the estate assets, protecting the estate property, satisfying creditor claims, paying taxes, pursuing claims for the estate, deciding if assets should be liquidated or not, investing estate assets, and then distributing the estate assets to the Beneficiaries. Other responsibilities that are not legal, but come with the job, include communicating with family members, resolving disputes over personal property, answering Beneficiary questions, overseeing the Estate Attorney and Accountant and even finding good homes for pets.
Who Should I Pick to be my Executor?
Serving as an Executor is a job that comes with potential liability. When selecting an Executor, don’t think of it as a reward for a friend or family member, think of it as an irksome job that may last well over a year. The person will be responsible for filing taxes, selling real estate, collecting on debts, dividing up personal property between nettlesome relatives, fielding phone calls from beneficiaries waiting for their inheritances and other, unpleasant tasks. An Executor should be someone financially responsible, stable, able to keep excellent records, able to work well with your heirs and trustworthy. Be honest with yourself about the difficulties and complexities of your estate and your family. Select someone who is up for the job. Remember, the Executor does not need to accomplish every task, as the Executor is free to hire an Estate Lawyer, CPA or realtor. The Executor is the quarterback and needs to make sure things get done.
Should I Make my Pennsylvania Estate Attorney my Executor?
Unless you state otherwise, whomever you select to serve as your Executor will take a fee. If you select a family member as Executor who then hires an Estate Lawyer and Accountant to assist them, then it might prove less costly to simply name the Estate Attorney as the Executor. Having your Pennsylvania Estate Lawyer serve as Executor will increase the chances that necessary tasks will be accomplished, taking the burden off your spouse.
What is a Fiduciary?
A Fiduciary is someone who is legally obligated to act in your best interests. Examples of Fiduciaries are Agents, Executors and Trustees.
Probate Estate vs. Taxable Estate
The Probate Estate refers to the assets which pass at your death through the probate process. The Taxable Estate refers to the assets that are subject to tax at your death. The Probate Estate and Taxable Estate are not necessarily the same, but they can be.
What is a Power of Attorney?
You cannot be everywhere at once, and sometimes you need someone to be somewhere for you and speak or sign for you. A Power of Attorney is a document you sign that authorizes someone else to act as your Agent. An Agent is someone acting for you.
Who Can Create a Power of Attorney?
To create a Power of Attorney you have to be an adult of sound mind, able to understand the powers, which you are granting to your Agent. Sadly, people often put off signing a Power of Attorney until either age or infirmity reduces their capacity so they are no longer legally able to grant a Power of Attorney. In that case the family is required to file a Guardianship Petition with the Orphans’ Court, which is much more complex and costly.
What are the Advantages of a Durable General Power of Attorney?
A Power of Attorney is durable if its terms state that the power you granted to your Agent continue if you become incapacitated. A General Power of Attorney may be durable, but not unless the document contains the correct terms.If you are a Pennsylvanian and you are concerned about who could handle your affairs should you ever become incapacitated, then you need a Pennsylvania Durable General Power of Attorney. A Pennsylvania Durable General Power of Attorney grants very broad powers to your Agent, usually so broad that the Agent can essentially replace yourself. By executing a Pennsylvania Durable General Power of Attorney naming a person you trust to serve as your agent, you avoid these extra steps and you know that person who is taking care of you is the person that you trust.
Who Should I Pick to be my Agent?
Who should you pick as your Agent? Select as your Agent only someone that you would trust with all your assets and your life. All Agents must be adults of sound mind. If you are Pennsylvania selecting an Agent for a Special Power of Attorney, then there is normally a specific task on a specific date that need be addressed. You should select a person you trust that can competently handle this job on that date. If you are selecting an Agent for a General Durable Power of Attorney, then your Agent will have a great deal of responsibility over a variety of task and that responsibility could be over a long period of time. If you have become incapacitated, this person cannot consult with you for your opinion. You should select a person who will shoulder this responsibility, who is trustworthy, honest and will be able to make difficult choices. If you have children, then you also need to take into consideration your family dynamic.
Can I Select More Than One Person as my Agent?
Certainly, but you should be honest about the personalities of the people you choose. They might have to make difficult choices with one another over a long period of time. If your children do not work well together, then they should not be Co-Agents. If you name two or more Agents, you must be clear if the Agents may act independently or whether they must act jointly. Giving your Agents the right to act independently allows them great flexibility, but confusion may result if they act counter to one another. If you require your Agents to act jointly, then each will be part of every decision, but a deadlock may result if they cannot negotiate over important matters. Once again, knowing your Agents and how they will work together is vitally important.
Do I Need a Durable Power of Attorney if my Spouse and I own Everything Jointly?
Yes! If your husband or wife becomes incapacitated, you can still sign checks and make withdrawals on joint bank accounts, but you cannot sell jointly owned stocks or real estate without your Spouse’s signature. You also cannot easily get information from your spouse’s pension or qualified plan provider (401k, IRA, SEP, etc.) or even sue the person who caused an accident that made your spouse incapacitated. You might also have problems obtaining information from insurance companies. If you do not have a Durable Power of Attorney from your spouse, you will not be able to sell the house without your spouse’s signature. It is a good practice for both spouses to have Durable General Powers of Attorney.
Can my Agent Tell Me What to Do?
No. By signing a Power of Attorney you are giving your Agent the power to take care of the things you want done, but does not limit your own ability or power to do things on your own. If you grant your Agent a Durable General Power of Attorney, then you have given your Agent the power to act for you once you become incapacitated. Selecting the right Agent is important, because you might lose some ability to care for yourself and you want an Agent that will work with you, not try to take over from you when you still are able to do some things on your own.
What are the Advantages of a Power of Attorney Over a Guardian?
If a person becomes incapacitated because of an accident, illness or age, unscrupulous persons or family members can easily take advantage of the person. To protect incapacitated Pennsylvanians the Commonwealth created a system where the Pennsylvania Orphans’ Court has the power to appoint Guardians. Unfortunately, the Pennsylvania Orphans’ Court judges do not know you or your family. They do not know whom you trust and to whom you would like to have these extensive powers. The judge will select someone to care for you, but it may not be someone that you would have picked. Further, the process of petitioning the Pennsylvania Orphans’ Court and having the hearing can be very expensive, using up funds that should otherwise go to your care.
How do I Stop a Power of Attorney?
You can “Revoke” your Power of Attorney at any time as long as you are competent (you understand what you are doing). The burden of informing all your financial institutions is on you, so if something has occurred to cause you to revoke your power of attorney, you should communicate this to the Agent and to any other person or entity to whom your Agent might take the Power of Attorney. This is best accomplished by having your Pennsylvania Power of Attorney Lawyer draft a revocation which can be sent immediately to your financial team.
What are my Agent’s Obligations and Duties to me?
Your Agent is a fiduciary, and he or she is obligated to follow your instructions and act in your best interests. Your Agent should keep accurate records of all actions taken and all assets under the Agent’s control. If the Agent harms you, the Pennsylvania Orphans’ Court can force the Agent to repay or repair the harm. Agents can be forced to account to the Pennsylvania Orphans’ Court.
What is a Pennsylvania Health Care Power of Attorney and Living Will?
Your health care is your business, and you have the right to make your own health care decisions as long as you are capable. In today’s world of modern medicine, you may easily need health care decisions long after you are competent and capable to communicate with your health care provider. These situations can arise quickly, the result of an accident or unexpected illness, leaving decisions such as what doctor should care for you, what treatment protocol should be followed and what medical care should be refused up to someone else. These can be very difficult decisions and it is important to you that the person making them represents your wishes and it is important to the person on whose shoulders you place this burden to know exactly what you wish from them. By completing a Health Care Power of Attorney and Living Will you are able to voice your wishes, select the person who will speak for you, but also give that person guidance to make these very difficult and personal decisions. A properly drafted Health Care Power of Attorney and Living Will should:
1.Appoint a person who can make health care decisions for you if you are ever unable to make them yourself;
2.Give that person the power under HIPPA to review your medical records and to gather information from your medical team;
3.Give your Surrogate guidance as to what your wishes are for medical care; and
4.Give your Surrogate the power to agree with your physician to stop providing you medical care if you are in a persistent vegetative state or in a terminal condition.
In addition, you may choose to address other issues, such as designating your Surrogate to have the power to donate your organs. Not every person is able or willing to serve as a medical surrogate and the decisions made might mean turning off your life support, so communication to your Medical Agent about your wishes and ideas on life support is a vital step in your estate plan. Without your guidance there could be disagreements among your family and friends as to who should be making decisions and what you truly wished.
Who Should Have a Pennsylvania Health Care Power of Attorney and Living Will?
Every adult should have one of these documents so that their own personal wishes about health care are respected and that the person they most want to speak for them when they are unable, has the power to communicate with health care providers.
Who Should I Select to Serve as my Health Care Agent or Surrogate?
The person you select as your Health Care Agent might face many difficult decisions including the decision to stop providing your health care. This person must have the characteristics of caring for you, but also being able to do the job for which you have appointed them.
Do I Have to Select My Spouse as my Health Care Agent?
No. Your spouse is the most obvious choice as your Health Care Agent, but if he or she cannot carry out your wishes, you should select someone else.