Estate Planning

Estate planning and asset protection are important but can be a complicated areas of law. Many people view estate planning as something that is only important for the wealthy. In reality, everyone, regardless of age or wealth, can benefit from some form of estate planning. While planning your estate on your own is doable, there are certain standards you must meet. And, without the careful guidance of a lawyer, you may make mistakes. You may not consider details, such as taxes, titling concerns, and beneficiary listings, which are essential to planning every estate. For example, did you know Pennsylvania is one of only 6 states that has an inheritance tax or what some call a death tax? This tax hits everyone and is relevant to every estate, regardless of any level of wealth. Or, did you know a simple Power of Attorney is one of the most important documents you can have? The attorneys at Anderson & Labovitz have seen these issues play out in their decades of practice helping families.

Whether you are just beginning to build your estate or want to protect the wealth that you have amassed over a lifetime, we are here to develop, refine, and implement the best strategy. We have successfully helped numerous families protect their hard earned assets for second and third generation family members and ensure their loved one’s wishes are carried out in an efficient and economical manner.

While a Last Will and Testament is a good starting point, we offer a broad scope of services to create a comprehensive plan, including:

 

Call us now at 412-209-3200 or send us an email at contactus@PaLawFirm.com to schedule a free, no-obligation conference to assess your needs.

Wills

Wills are the foundations of most estate plans. In order to be effective, however, they should be comprehensive and detailed; and, your attorney must work intimately to understand the family. As your attorneys, we will help you draft a will that leaves no room for doubt. With 15 years of experience, we know what details to include and what language to use to make sure your Will accomplishes your goals and stands up against challenges in a clear fashion.

Revisions of Wills

We can help you review or update an old will. We have the knowledge of Pennsylvania law to keep your will up-to-date with current statutes. It is important to review your will at least every five years to ensure it still meets your wishes and desires.

Even if you have a Will prepared by another attorney, we are happy to help. Some people have the misconception that they must return to the same lawyer who drafted the original will to update matters. This is not true. We have helped many clients revise their Wills and are happy to communicate with your previous lawyer to ensure there are no confusing copies out there.

If it has been a while since you reviewed your current will, we are happy to review your documents and provide guidance to meet your goals and desires.

Out of State? We’re Happy to Assist Your Loved Ones

Maybe work or family has required you to move out of state, but your mother, father, or other loved one still resides in western Pennsylvania. As your loved one ages, you might notice that their personal bookkeeping and ability to manage their day-to-day affairs is faltering. This can be extremely difficult to manage from afar. We can help you assist your loved one by meeting one-on-one to help ensure proper planning is in place or up to date to avoid problems down the road.

Trusts

Trusts are advanced estate planning instruments designed to  help an individual  minimize estate taxes and avoid the difficulties of probate. The attorneys at Anderson & Labovitz are well versed in determining when a trust is appropriate , and what type of trust will best align with the individual’s  goals. Broadly speaking, the most common types of trusts are: a Revocable Trust, an Irrevocable Trust, a Special Needs Trust, and a Testamentary Trust.

Revocable Trusts

A  revocable trust is one of the most widely used  and versatile estate planning tools, providing flexibility and control. It allows an individual (the grantor) to transfer assets into the trust, which helps avoid probate. In the case of real estate, a revocable trust can also facilitate transfers without incurring  transfer tax. An advantage of a revocable trust is that it permits the grantor to change the terms of the trust and add (or remove) assets from the trust during the grantor’s  lifetime. 

Upon the death of the grantor, a revocable trust becomes irrevocable. In the case of a married couple, it becomes irrevocable upon the death of the last surviving spouse. While a revocable trust allows the grantor to change his or her trust during their lifetime, such flexibility also means that assets in a revocable trust may be countable by entities examining  the individual’s  assets for eligibility to means-based programs, such as Medicaid, and accessible to creditors.

Irrevocable Trusts

The irrevocable trust, while less common than the revocable trust, is also an important tool in protecting an individual’s assets. Unlike a revocable trust, once assets are transferred into an irrevocable trust, the grantor relinquishes all control and ownership of those assets. . 

The irrevocable trust offers many benefits for an individual , including but not limited to asset protection, estate tax reduction, and inheritance tax exemption.  By placing assets into the irrevocable trust, the assets are exempt from the Pennsylvania Inheritance Tax. Additionally, the irrevocable trust protects assets from the beneficiary’s creditors, while also removing assets from  the individual’s estate and from consideration of their  available assets, if done properly.

An irrevocable trust is particularly useful when the grantor wants to pass assets to beneficiaries who may face financial challenges, to beneficiaries who suffer from substance abuse disorders, or to those who have creditors that could potentially come after a beneficiary’s assets.. However, it is important to note that unlike a revocable trust, once an irrevocable trust is established, it cannot be changed without extreme difficulty and potential court intervention.

Testamentary Trusts

A testamentary trust is a trust created  by a client’s last will and testament, and is funded only upon the death of the client. Unlike revocable or irrevocable trusts, which are established and funded during the grantor’s lifetime, a testamentary trust takes effect only after the client’s death. A testamentary trust is typically included in the last will and testament and is commonly used to manage assets when a client has minor children or would like to leave a beneficiary his or her share of the estate in trust for his or her benefit. Although testamentary trusts can provide long term asset protection, they are subject to the probate process and may involve additional administrative costs. 

Special Needs Trusts

A special needs trust is a type of irrevocable trust that protects assets for beneficiaries who are receiving government benefits to maintain their eligibility for said benefits. There are two types of special needs trusts: a third-party special needs trust and a first-party special needs trust. 

A third-party special needs trust is a trust established by an individual other than the beneficiary (typically a family member) for the benefit of an individual  who is receiving  government benefits. The third party may transfer assets into the trust without jeopardizing the individual’s eligibility for such benefits. 

A first-party special needs trust, on the other hand, is a trust established by the beneficiary themselves when he or she receives a sum of money in their own right to protect his or her eligibility for government benefits. A first-party special needs trust can only be established if the beneficiary is under the age of 65, and contributions are only permissible  to a special needs trust until the beneficiary reaches this age. The funds in a third-party special needs trust do not need to be paid back to the Department of Human Services upon the death of a beneficiary, while here, the funds in a first-party special needs trust do need to be paid back.

Powers of Attorney

A Pennsylvania Durable Power of Attorney is a very powerful document but is one of the most important for your Estate Plan. Through the use of a Power of Attorney, you can give your named agent the power to handle your financial affairs in critical times. This power can be used to merely make handling everyday affairs easier between spouses ease bookkeeping matters for an elderly loved one, or even avoid potential costly guardianship proceedings. A Power of Attorney can also be key in ensuring your Estate Plan matters are handled appropriately.

Probate Avoidance, Asset Protection and Tax Planning

With proper planning and guidance, as well as the use of other techniques and services we provide, it is possible to avoid the expensive and lengthy probate process and minimize inheritance taxes.

Living Wills and Healthcare Powers of Attorney

The question is often presented: How do you want your medical care to be handled in an end-of-life situation? Do you want doctors to do everything possible to keep you alive, or do you want them to cease treatment at a certain point?

While difficult to think about, these are extremely important questions to answer while you are in good health. Not only will these documents give doctors guidance to make the right choice based upon your own expressed desires, it will also remove the stress from your family in having to make this decision for you.

Your healthcare agent is someone you choose to follow your written guidance and make healthcare decisions for you. You can name a family member or a friend who is familiar with your beliefs and values to follow your Heathcare Power of Attorney and Living Will and make decisions for you.

As your attorneys, we will help guide you through the difficult but important decisions that are necessary to create a Durable Health Care Power of Attorney and Living Will. We will make sure your wishes are expressed clearly, so there is no room for dispute and to eliminate the stress often experienced by loved ones.

We are available for our clients during emergencies.

Our firm can meet clients at health care facilities or during an emergency. If you or a loved one has been seriously injured and needs to quickly draft a will, financial power of attorney or medical power of attorney, we can help.

FAQ

Trust, estate and tax laws are constantly changing. We counsel clients with up-to-date advice in order to properly plan their estates, protect the assets they build over a lifetime, and ensure the family is protected. We are here to help answer any questions you may have and are just a phone call away at 412-209-3200 or feel free to or send us an email at contactus@PaLawFirm.com.

The cost for administering an estate is determined by the administration method. Our cost structure consists of either hourly rates, percentage based rates, or simple flat fees.

  • Without a will, the disposition of your estate is determined by the structure of your family.  
    • For example, if you are married and have no children, but your parents are still alive, your spouse will receive the first $30,000 of your estate. The remaining amount of your estate will be equally divided between your spouse and your parents. 
    • Another example would be if you were married with children, all of whom you shared with your current spouse. Your spouse would again be entitled to receive the first $30,000 of your estate. The remaining amount of your estate would now be equally divided amongst your spouse and your children. 
  • Although the laws of the state assume disposition based on relationship, this could create problematic outcomes. For example, if your estate fell under the first example, this may create problems for your elderly parents trying to apply for medical assistance. If your estate fell under the second example, this may create issues if your children are still minors, as minors are not able to directly inherit. 
  • This is why it is important to ensure you have proper estate plans in place, which our Estate Planning attorneys at Anderson & Labovitz are able to assist you with.

With no Testamentary Trust in place, the Executor will be forced to go through trust proceedings to either set up a restricted account or a Trust that will hold the money for your children.  By setting up a simple Testamentary Trust, these court proceedings could have been fully avoidable and the funds could have been accessible to benefit the children.

Generally speaking, Yes.  However, often times there are write-offs or deductions which may be taken to minimize the tax consequences.

Pennsylvania is one of six states with an Inheritance Tax or death tax on inherited assets.  Inheritance Tax Returns are necessary even if there is no probate estate.  Inherited IRA’s, Joint assets, and other assets with beneficiary listings are taxed in most circumstances!  Generally, Life Insurance is the only asset for which there is no tax due payable to Pennsylvania.

Yes! Generally speaking the creation and funding of trusts are one of the best ways to avoid the court costs and time it takes to probate an estate..

There are a number of situations in which a trust would be the best way to transfer wealth to their beneficiaries. If your loved one has special needs, issues with substance abuse or addiction, or is irresponsible with money, a trust is an excellent way to provide for your loved one while still ensuring that the funds are protected for your loved one’s benefit.

A revocable trust is an excellent way to transfer a house to a child without going through probate and without having to pay a realty transfer tax. The client can establish the revocable trust and transfer his or her residence into the trust prior to his or her death. By naming your child as a beneficiary of the revocable trust, your child will receive the house free of probate.

Yes! By placing property you hold in another state into your revocable trust, your loved ones will not need to open probate in the state in which the property is located.

Yes! Our office can include provisions for a third party special needs trust in your estate planning documents to make sure that your daughter’s share is held in a special needs trust and she maintains her government benefits.