Estate Planning & Trust Planning. Although there are many different types of estate planning and trust planning documents and strategies, most estate plans include the core documents of Wills, Durable Powers of Attorney and Health Care Directives (including Living Wills). Many effective estate plans also include the use of trusts.
Your Will. If you die intestate (without a Will), then the state’s intestate laws will determine who receives your property. That may or may not be in accordance with your wishes. Your Will allows you to alter the Pennsylvania intestate laws to suit your personal preferences.
A Will provides for the distribution of assets owned by you at the time of your death in almost any manner you choose. Your Will cannot, however, govern the disposition of assets that pass outside your probate estate, either by reason of how the assets are titled (such as joint property with right of survivorship) or if the assets have beneficiary designations other than your estate (such as life insurance, retirement plans and employee death benefits).
Wills can be of various degrees of complexity and can be utilized to achieve a wide range of family and tax objectives. Wills can include trusts that will be funded after death, sometimes for tax reasons and sometimes to provide ongoing asset management and benefits for family members, other individuals or charities. Alternatively, a Will may leave assets to a preexisting Living Trust or other trust created during your lifetime. This is known as a “Pour-over Will”.
Your Durable Power of Attorney. A Durable Power of Attorney typically gives one or more persons the power to act on your behalf on a variety of legal and financial matters. The Power of Attorney may be limited to a particular activity (e.g., going to settlement on the sale of real estate) or it may be general in its application, empowering one or more persons to act on your behalf in a variety of situations.
If you do not have a Power of Attorney and become unable to manage your personal or business affairs, it may be necessary for a court to appoint one or more agents to act for you. People or banks appointed in this manner are referred to as guardians, conservators, or committees, depending upon local state law. The key is that the guardian or other appointed agent may or may not be the person that you would have chosen to act on your behalf. Frequently, one appoints family or friends in the role of agent under a Durable Power of Attorney.
Your Health Care Directive. Our Health Care Directives are really two documents in one. First it is a Durable Power of Attorney for Health Care in which you appoint one or more individuals to make medical decisions on your behalf if for any reason you cannot make those decisions on your own. This can include such decisions as what medical procedures you undergo, which doctors and other medical staff attend to you, what hospital or other facility you go to. The Durable Power of Attorney for Health Care can be extremely helpful in both routine medical procedures and end-of-life medical decisions.
A Health Care Directive can also include directions for end-of-life decisions, typically referred to as a Living Will, Health Care Declaration or Health Care Proxy. A Living Will is part of the Health Care Directive and sets forth your wishes with regard to utitilizing or with holding medical care if you are in a terminal end-stage medical condition.
A Health Care Directive can relieve your family and friends from having to guess what you might have wanted by providing a clear declaration of your intentions with regard to your health care. Such a document also avoids disputes over who makes these decisions on your behalf.
Trusts. Trusts can be used for a wide variety of purposes, but come in two basic types. The first type is testamentary trusts, which are trusts contained in your Will and that are funded after your death. The second type is inter vivos trusts which you create and fund during your lifetime. Inter vivos trusts may be revocable (subject to being changed) or irrevocable (not subject to change) or a combination of the two.
Living Trusts, for example, are inter vivos revocable trusts that you establish and fund during lifetime. Although Living Trusts are often promoted for avoiding probate, they can also provide seamless management benefits for while you are alive.
Other common trusts include Family Trusts that can be used for providing funds for various family members and very often for children. They are commonly used for education, support and health care. In addition, sometimes these trusts are used to hold family real estate or vacation homes. Family Trusts can either be testamentary trusts or inter vivos trusts, and can be used to provide for the orderly management and distribution of assets.
Another large category of trusts are those trusts that have as a principal goal reducing taxes. All of these trusts can be inter vivos, and some of them can also be testamentary. Some examples are Credit Shelter Trusts, Marital Trusts, Generation Skipping Trusts (a/k/a Dynasty Trusts), Irrevocable Life Insurance Trusts (ILIT’s), Qualified Personal Residence Trusts (QPRT’s) and Grantor Retained Annuity Trusts (GRAT’s), to name just a few.
Another group of trusts are charitable trusts that can aid charities or a combination of charities and individuals, while providing tax benefits to you. Some common examples of these are Charitable Remainder Unitrusts (CRUT’s), Charitable Remainder Annuity Trusts (CRAT’s), Charitable Lead Trusts (CLT’s) and variations of each of these trusts, as well as Private Foundations.
With our years of experience with many forms of trusts, we can help you determine what trust or trusts, if any, may be right for you.
Your Will. If you die intestate (without a Will), then the state’s intestate laws will determine who receives your property. That may or may not be in accordance with your wishes. Your Will allows you to alter the Pennsylvania intestate laws to suit your personal preferences.
A Will provides for the distribution of assets owned by you at the time of your death in almost any manner you choose. Your Will cannot, however, govern the disposition of assets that pass outside your probate estate, either by reason of how the assets are titled (such as joint property with right of survivorship) or if the assets have beneficiary designations other than your estate (such as life insurance, retirement plans and employee death benefits).
Wills can be of various degrees of complexity and can be utilized to achieve a wide range of family and tax objectives. Wills can include trusts that will be funded after death, sometimes for tax reasons and sometimes to provide ongoing asset management and benefits for family members, other individuals or charities. Alternatively, a Will may leave assets to a preexisting Living Trust or other trust created during your lifetime. This is known as a “Pour-over Will”.
Your Durable Power of Attorney. A Durable Power of Attorney typically gives one or more persons the power to act on your behalf on a variety of legal and financial matters. The Power of Attorney may be limited to a particular activity (e.g., going to settlement on the sale of real estate) or it may be general in its application, empowering one or more persons to act on your behalf in a variety of situations.
If you do not have a Power of Attorney and become unable to manage your personal or business affairs, it may be necessary for a court to appoint one or more agents to act for you. People or banks appointed in this manner are referred to as guardians, conservators, or committees, depending upon local state law. The key is that the guardian or other appointed agent may or may not be the person that you would have chosen to act on your behalf. Frequently, one appoints family or friends in the role of agent under a Durable Power of Attorney.
Your Health Care Directive. Our Health Care Directives are really two documents in one. First it is a Durable Power of Attorney for Health Care in which you appoint one or more individuals to make medical decisions on your behalf if for any reason you cannot make those decisions on your own. This can include such decisions as what medical procedures you undergo, which doctors and other medical staff attend to you, what hospital or other facility you go to. The Durable Power of Attorney for Health Care can be extremely helpful in both routine medical procedures and end-of-life medical decisions.
A Health Care Directive can also include directions for end-of-life decisions, typically referred to as a Living Will, Health Care Declaration or Health Care Proxy. A Living Will is part of the Health Care Directive and sets forth your wishes with regard to utitilizing or with holding medical care if you are in a terminal end-stage medical condition.
A Health Care Directive can relieve your family and friends from having to guess what you might have wanted by providing a clear declaration of your intentions with regard to your health care. Such a document also avoids disputes over who makes these decisions on your behalf.
Trusts. Trusts can be used for a wide variety of purposes, but come in two basic types. The first type is testamentary trusts, which are trusts contained in your Will and that are funded after your death. The second type is inter vivos trusts which you create and fund during your lifetime. Inter vivos trusts may be revocable (subject to being changed) or irrevocable (not subject to change) or a combination of the two.
Living Trusts, for example, are inter vivos revocable trusts that you establish and fund during lifetime. Although Living Trusts are often promoted for avoiding probate, they can also provide seamless management benefits for while you are alive.
Other common trusts include Family Trusts that can be used for providing funds for various family members and very often for children. They are commonly used for education, support and health care. In addition, sometimes these trusts are used to hold family real estate or vacation homes. Family Trusts can either be testamentary trusts or inter vivos trusts, and can be used to provide for the orderly management and distribution of assets.
Another large category of trusts are those trusts that have as a principal goal reducing taxes. All of these trusts can be inter vivos, and some of them can also be testamentary. Some examples are Credit Shelter Trusts, Marital Trusts, Generation Skipping Trusts (a/k/a Dynasty Trusts), Irrevocable Life Insurance Trusts (ILIT’s), Qualified Personal Residence Trusts (QPRT’s) and Grantor Retained Annuity Trusts (GRAT’s), to name just a few.
Another group of trusts are charitable trusts that can aid charities or a combination of charities and individuals, while providing tax benefits to you. Some common examples of these are Charitable Remainder Unitrusts (CRUT’s), Charitable Remainder Annuity Trusts (CRAT’s), Charitable Lead Trusts (CLT’s) and variations of each of these trusts, as well as Private Foundations.
With our years of experience with many forms of trusts, we can help you determine what trust or trusts, if any, may be right for you.
