Wealth Preservation, Trusts and Estates

Because the estate’s entire tax liability is generally due to be paid to the IRS and the Pennsylvania Department of Revenue within 9 months of a person’s death, executors can find themselves without sufficient liquidity to pay for such inheritance taxes and estate taxes.

David M. Frees III on Paying For Estate and Inheritance Taxes

These taxes are also often due just when the executor is paying for lifetime tax liabilities, funeral expenses and various administrative expenses.

How do you plan for such tax payments to avoid interest and penalties?

I recently did two articles covering these issues.

To read more about paying for federal estate taxes and Pennsylvania inheritances taxes, click these links:

Paying Inheritance and Estate Taxes Part One

Paying For Inheritance and Estate Taxes Part Two

David M. Frees III, Esquire
610-933-8069
See David M. Frees’ Superb AVVO rating

David M. Frees III

David Frees Chairs the Trust, Estate, and Wealth Preservation Section of
Unruh, Turner, Burke and Frees

His practice focuses on estate planning, wills, trusts, asset protection,
and in representing the owners of family businesses, and the directors and officers
of public and privately held corporations.

If you haven’t reviewed your insurance coverages lately, then you must visit the issue of uninsured and under insured coverages. When you buy liability insurance, you are protecting your assets from being taken in a lawsuit in the event you injure another person.

However, there a re many uninsured drivers in Pennsylvania and many more who have the very limited coverages required by law. But if one of these drivers hits you, and you are injured, you may never be able to recover for your injuries….unless….

David M. Frees III
How to protect yourself and your family.

If you would like to be on the early bird list for David’s
upcoming book on insurance coverages and how they
apply to your estate and asset protection planning, please email
David at dfrees@utbf.com and include the words asset protection
insurance book in the subject line.

I recently posted a short review of USA Today’s excellent article on the question of who needs a will? So if you have been wondering “Do I need a will?” then click here for more information on the question “Who needs a will?”

David M. Frees III and USA Today on Who Should Do A Will?

David M. Frees III
610-933-8069

For more information and secrets of doing an effective will, click here.

Have you thought about disinheriting a child or grandchild?
Do you intent to “write” an heir out of your will who might expect an inheritance?
Are you leaving one child more than another child?
Do you children have radically different needs and you are considering an unequal distribution or gift to your children?

David M Frees on disinheriting a child or grandchild and will contests

If you answer yes to any of these questions then your estate planning may not be as simple as you think. And, it is vitally important that you read this brief article and consider some of the options becasue all of these factors have lead and regularly result in will contests.

First, you may need an attorney that practices regularly if not exclusively in the area of trust and estates planning – a “will lawyer.” Why? Will contests can be expensive, time consuming and very disruptive to family relationships. An experienced lawyer will give you all of your options and will take precautions to ensure that your capacity is documented, that you wishes get carried out, and that family relationships can be preserved whenever possible.

Next, consider making a gift to a person who you might have initially left out of the will. This reduces the likelyhood that the omission will be viewed as a mistake. And, if you also include a special no contest clause in your will the party being given a gift has an incentive not to attack the document.

Such clauses typically provide that if a beneficiary challenges the will or trust, that they lose any gift to to them under the terms of the document. However, a child who is left nothing has no incentive to hold back and a contest is more likely.

It is also important to document that you have capacity to make the will and that you are not being influence by a family another member. We have a practice of asking a series of questions of each client, before the will’s witnesses to insure that the witnesses have an opportunity to verify that you know what you are doing, that all of the formalities are being observed, that the will is not invalid and that you are not under the influence of drugs or alcohol that might diminish your ability to understand everything that is occurring.

In this way, we can discourage will contest, and if they occur, we can minimize the lieklhood of success of the challenger and make sure that your wishes are actually carried out.

More to follow on avoiding a challenge to your will:
Consider a pour over will
Fund the trust
Coordinate with non probate assets
Get evidence from a doctor when desirable
Improve family communication
Consider a memorandum

David M Frees III practices in the areas of estate and trust planning and in representing
executors and trustees.

610-933-8069
Call Donna Brownback for an appointment or more information.
Mention the web site to receive more resources for clients and executors.

by Douglas L. Kaune, Esquire
Estate Planning & Administration, Wills,
Trusts, Asset Protection, Elder Law
Unruh, Turner, Burke & Frees
Phoenixville, Malvern, West Chester
Pennsylvania Attorney
dkaune@utbf.com PH: 610-933-8069

Family Care Agreements, also referred to as Cargegiver Agreements, have increased in popularity as a result of the more stringent Deficit Reduction Act (DRA) Medicaid gifting rules. These agreements are usually established between an elderly individual who is agreeing to “pay” and the individual or individuals who is/are agreeing to provide continued care and assistance into the future. This agreement, if drafted properly, may allow for a significant portion of the the elderly individual’s assets from being spent on nursing home care. The Family Care Agreement has become a regular planning tool for elder law attorneys in Pennsylvania and other jurisdictions. The payment amount will be subject to income tax so care should be made in making the decision to use this type of planning.

Douglas L. Kaune, Esquire

In a recent case, the tax payer had a victory over an IRS challenge that sought to include the full value of FLP (family limited partnerships) assets into the decedent’s estate.

Family limited partnerships are often used to manage family businesses, real estate ventures, and even in some cases, publicly traded securities and other more liquid investments. They allow the transfer of assets (in some cases at a discount) while permitting a general partner to manage the assets.

David Frees and Ivanka Trump

However, because in part of aggressive discounting of asset values and for other related reasons, these arrangements have been attacked by the IRS.

In the recent blog posted on www.paestateplannners.com I have linked to an anlysis of the new case and have given some short, and non technical points to remember when doing this type of planning.

When done correctly, family limited partnerships serve many business, and wealth preservation goals.
To learn more click Family Limited Partnerships – A Partial Victory for the Tax Payer.

David M. Frees III
610-933-8069
dfrees@utbf.com
David and his partners and associates in the Wealth Preservation, Tax,
and Corporate sections work with many clients to develop
and implement Family Limited Partnership and Trust strategies
for our clients in Chester County, Delaware County, Lancaster, Bucks,
Berks and Philadelphia counties and throughout Pennsylvania