Over the past ten years, your family needs and retirement planning needs have likely changed dramatically.

Likewise, over the past decade, the laws of Estate Planning have drastically changed.  For example, no longer is the Federal Estate tax a concern merely for those with extreme wealth.  Same sex couples are no longer excluded from certain Estate Planning benefits.  Your right to your share of Social Security benefits has changed.  And, most importantly, no longer can you put off adhering to three basic necessities of Estate Planning.

1) Put together a great team.

A proper team is the very foundation of proper Estate Planning.  Estate Planning involves giving due consideration to investments, tax considerations, and utilizing the right legal documentation to ensure your assets provide for you during your retirement years  and provide for your loved ones beyond your life.

Elliott & Davis is a full service firm which enables you to take advantage of its experienced tax planning attorney and domestic relations attorneys.  Further, Elliott & Davis has built strong relationships with local Accounting Firms and Investment Firms.

2) Update your Beneficiaries.

This is also one of the simplest to do.  Many people who have not assembled the proper team still list the same primary beneficiary on their insurance policy or retirement plan as they did when they landed their first job!  Listing the proper beneficiaries enables you to avoid costly estate and inheritance taxes.

 3) Prepare a Will, Living Will and Power of Attorney

 Not know Wills are not all the same.  The proper will may establish a trust, establish a guardian for your minor child and even dictate how your child is cared for.  Additionally, while we are all asked by our doctor if we have a Living Will, how many actually say, “yes”?  Each of us has strong feelings about our body and what type of life sustaining treatment we would want.  Whether those convictions are founded in religion, past experiences, or other beliefs, would your doctor know you wanted treatment refused, or would a funeral director know to embalm your body as opposed to cremation?  These ideas and more are encompassed in Living Wills and Powers of Attorney.

Contact us to begin assembling your team and to ensure your financial wishes are met and personal desires are known.

 

January was New Year’s resolution time; how did that work out?  Yeah, it’s the same for many.  But don’t fret.  

Unlike your New Year’s resolution, there is one thing that our lawyers can definitely make happen. We make it quick and easy for you to get the appropriate estate planning documents in order, including an up to date Will, Power of Attorney and Living Will.

Preparing a proper estate plan is important to persons at all walks of life. The process of drafting proper estate planning includes understanding and determining how assets will be distributed, and how debt will be paid.  Also, very important to many of my clients is the naming of guardians for children, as well as trustees to provide for those children, and agents to provide proper care and support for elderly parents.  Furthermore, if substantial net worth is involved, then the planning must deal with the federal tax planning and gifting schemes.  Recent fiduciary code changes and revisions to tax laws are yet another reason to review documents in place or to have documents prepared if none exist.

If you have not reviewed your Will or Estate Planning documents within the past 24 months, or if you have yet to begin the process, then right now is the perfect time to contact our office for a free review and/or consultation.  A few issues you’ll want to consider are:

• Recently enacted Pennsylvania law has limited certain Power of Attorney powers thereby requiring new wording to enable some specific powers.  We recently were involved in a property sale where an old Power of Attorney was rejected, due to old form.  This rejection jeopardized the sale of property in a multi-million dollar estate, potentially causing expensive litigation fees.  Through some quick, meticulous work, we were able to avoid litigation.  However, others are not as fortunate.

• Review and update beneficiary designations and account ownership.  We’ve reviewed various plans where divorced individuals have failed to timely update bank account ownership or real estate titling.  We’ve also run into circumstances where the mere failure to list a beneficiary has resulted in a costly and lengthy probate process which otherwise could have been avoided.  Don’t fall into these situations where you end up losing an account or wasting money on taxes and court costs!  In reviewing your beneficiary designations, remember, minor children should not be named direct beneficiaries of any assets.

• “I’m not rich, I don’t need a trust”  Wrong!  If you have minor children, your Will should make provisions for holding your assets in a trust at least until the age of majority (age 18).  Often times, in conversations with clients, we find young adults are not prepared to handle even relatively small amounts of money.  We’ve learned children are better served by having an appropriately appointed Trustee provide for their comfort, care and support as you deem fit. Take a moment to add up the total value of your estate, including life insurance and see if you think your child would be ready to receive his or her share outright.

Proper estate planning involves the teamwork of attorneys, financial planning professionals, and CPA’s. This teamwork is because there needs to be a coordination of estate taxes, income taxes, multi-generational financial planning, life insurance planning and trust planning.  It is these combined efforts that typically create the most effective estate plans.

It’s not too late.

Some opt to devise property to their children in their will; others find it makes sense to exclude one or more of their children or relatives.  

As people attempt to address the unique demands of their situation, they may have questions about disinheriting a child. Sometimes individuals ask about either (1) his or her ability to disinherit a child; or (2) whether her or she must specifically disinherit a child in their will. Although an individual in Pennsylvania can never completely disinherit a spouse, the same is not true for children.

Pennsylvania’s highest court, the PA Supreme Court, has explained that “a parent does not have to leave any of his property to any of his children, irrespective of whether he likes them or dislikes them, or hates them, and he does not have to disclose his reasons for disinheriting them,” as in the case of re Sommerville’s Estate, 177 A.2d 496, 499 (Pa. 1962). However, in the absence of clear and plain language in a will indicating otherwise, it is presumed that a parent does not intend to disinherit their children. In re Newlin’s Estate, 80 A.2d 819, 823 (Pa. 1951). Because of this presumption, it is always better for a will to include plain language which expresses a desire to disinherit a child by name rather than simply leaving them out of the will.

There is no one size fits all estate planning solution.

Well, your child has graduated from college and you’ve cut the strings….so you hope.  The question now becomes:

What impact does this have on my Estate Planning? 

A variety of concerns are raised.  Importantly, in light of the turbulent job market, hopefully you have come to understand a salary cannot be taken for granted.  While you likely appreciate this in your own life, you too must understand this consideration for your recent grad.  Planning for the future means you also need to ensure you have the proper means to support your grad who becomes unemployed and has nowhere to turn.

What about that 529 Plan?  Are you fortunate enough to have your contribution amounts ready for investment elsewhere?  Do you have a balance remaining in that 529 Plan?  There are certain tax considerations you should understand before cashing out.  There are roll-overs and estate tax savings that can be had.

As to your existing Estate Planning documents, your child has been an adult for several years now.  Does your Will or Trust need updated?  Should beneficiaries on your financial policies be updated?

Most importantly, if you have no Will, Living Will or Power of Attorney, now is the time to have those documents drafted.  These documents, while minimal in cost, can save drastic amounts in the future and ensure your loved ones are protected.  You have worked your entire life to create your wealth and provide for your loved ones.  Take the time to ensure you’re life’s wealth is protected.

Over the past decade, not only have you grown older, but your retirement planning needs and your family’s financial needs have drastically changed.  Similarly, over the past decade, the laws of Estate Planning have drastically changed.  No longer is the Federal Estate tax a concern merely for those with extreme wealth.  No longer are same sex couples excluded from certain Estate Planning benefits.  No longer can you expect to receive your share of Social Security benefits.  And, most importantly, no longer can you put off adhering to three basic necessities of Estate Planning.

1) Put together a great team.

A proper team is the very foundation of proper Estate Planning.  Estate Planning involves giving due consideration to investments, tax considerations, and utilizing the right legal documentation to ensure your assets provide for you during your retirement years  and provide for your loved ones beyond your life.

2) Update your Beneficiaries.

Updating your beneficiaries is one of the most forgotten and neglected items.  Yet, it is also one of the simplest to do.  Many people who have not assembled the proper team still list the same primary beneficiary on their insurance policy or retirement plan as they did when they got their job at upon graduation.  Listing the proper beneficiaries enables you to avoid costly estate and inheritance taxes.

 3) Prepare a Will, Living Will and Power of Attorney

If you’re reading this, you have likely realized a Will is necessary to proper Estate Planning.  However, you may not know Wills are not all the same.  The proper will may create a trust, establish a guardian for your minor child and even dictate how your child is cared for.  Additionally, while we are all asked by our doctor if we have a Living Will, how many actually say, “yes”?  We have strong feelings about our body and what type of life sustaining treatment we would want.  Whether those convictions are founded in religion, past experiences, or other beliefs, would your doctor know you wanted treatment refused, or would a funeral director know to embalm your body as opposed to cremation?  These considerations and more are encompassed in Living Wills and Powers of Attorney.

Eric Davis, Esq.

Elliott & Davis, PC

412.434.4911 x 11

eric@elliott-davis.com

425 First Avenue, First Floor Pittsburgh, PA 15219

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