Building a lasting legacy takes more than simply accumulating a large portfolio. The estate planning attorneys at Sweat Law can help you develop a plan to efficiently accumulate and transfer your assets during your life as well as meet your end-of-life desires and obligations. A well established strategy ensures your wishes are honored today and in the event of your incapacity or death.
Ensure that your assets are transferred to the right people at the right time, according to your wishes. The document you will need to file is called a Last Will and Testament which deals with both real and personal property. There are certain requirements when creating a Last Will and Testament in the state of Pennsylvania. The administrator of your will (also called a testator) must be above 18 years old, fully capable of reasoning and decision making, and must personally sign the will. Witnesses are not mandatory by law, however many Registers of Wills insist upon no less than two witnesses to be present at the time of probate.
The beneficiaries of the will can be either an individual or a charitable organization. While a will and a trust can help you accomplish this goal, they differ slightly on one point: privacy. A will becomes a matter of public record as it is executed during probate. Anyone can see what’s in a will and who gets what. By contrast, the transfer of assets into a trust is handled privately.
The primary intent of a will is to list the plans of a decedent in matters involving his or her estate post death. If you are planning for your future and desire to create a will, a lawyer from our firm can help lead and direct you through the process
There are many types of trusts; a major distinction between them is whether they are revocable or irrevocable.
A. Revocable trust: Also known as a living trust, a revocable trust can help assets pass outside of probate, yet allows you to retain control of the assets during your (the grantor’s) lifetime. It is flexible and can be dissolved at any time, should your circumstances or intentions change. A revocable trust typically becomes irrevocable upon the death of the grantor.
You can name yourself trustee (or co-trustee) and retain ownership and control over the trust, its terms and assets during your lifetime, but make provisions for a successor trustee to manage them in the event of your incapacity or death.
Although a revocable trust may help avoid probate, it is usually still subject to estate taxes. It also means that during your lifetime, it is treated like any other asset you own.
B. Irrevocable trust: An irrevocable trust typically transfers your assets out of your (the grantor’s) estate and potentially out of the reach of estate taxes and probate, but cannot be altered by the grantor after it has been executed. Therefore, once you establish the trust, you will lose control over the assets and you cannot change any terms or decide to dissolve the trust.
An irrevocable trust is generally preferred over a revocable trust if your primary aim is to reduce the amount subject to estate taxes by effectively removing the trust assets from your estate. Also, since the assets have been transferred to the trust, you are relieved of the tax liability on the income generated by the trust assets (although distributions will typically have income tax consequences). It may also be protected in the event of a legal judgment against you.
Other benefits of trusts include:
Specify the extent to which you want health care professionals to treat you if you become ill or incapacitated.
Identify people you trust and give them the legal authority to act on your behalf in case of an accident or sudden illness. A power of attorney for health care can make health care decisions on your behalf if you’re unable to do so and can access your medical records to the extent that it’s allowed under the Health Insurance Portability and Accountability Act (HIPAA). And a durable power of attorney for finances allows that person to handle your personal financial affairs like signing checks and preparing tax returns.
Power of attorney is granted to an “attorney-in-fact” or “agent” to give that individual the legal authority to make decisions for an incapacitated “principal.” The laws for creating a power of attorney vary from state to state, but there are certain general guidelines to follow. Before you or a loved one signs any documents, however, be sure to consult with an attorney concerning all applicable laws and regulations.
The principal determines the amount of power given to the attorney-in-fact, and this individual can be given the authority to deal with only one particular issue (a specific power of attorney), or to handle most of the principal’s personal and financial matters (a general power of attorney). Regardless of the type of power of attorney granted, the attorney-in-fact is responsible for keeping accurate records of all transactions that he or she makes on behalf of the principal. The attorney-in-fact also is responsible for distinguishing between the types of decisions he or she has the power to make and other decisions.
There are multiple types of decisions that the attorney-in-fact can be given the power to make, including the power to:
So give the gift of an estate plan. It’s just as important as the gift of money. Not only will your wishes be honored, you won’t burden your loved ones with having to make important decisions on your behalf