Wealth Preservation, Trusts and Estates

Everyone wants to avoid probate.

The probate system is viewed as slow, expensive, and too public.

But sometimes, if you’re an executor, you really want and need the probate system and the orphan’s Court judge.

The truth is, that most of the estates where the executor hires us to do the administration, and to keep them out of trouble, we are also able to keep them out of the probate system and the probate court.

We often settle estates, where the beneficiaries are cooperative by using a family settlement agreement. This saves the family and the heirs time, and money and at the same time protects the executor from being sued later.

But, there are five times when the executor to be fully protected and to avoid liability needs AND WANTS the Probate Court.

When should you use the probate court? When does it actually make sense to go through the probate process for your own protection? Read this article on the Five Times When You Really Want To Probate A Will. Oh, by the way, for reasons that I cannot fully explain, there are some reports appearing at the top of the page. If you’re interested in when to avoid probate and when to actually use probate, just scroll down to the article. It is worth it.

David M. Frees III
610-933-8069

Call Donna or Denise for an appointment or Telephone consultation with David M. Frees III

www.PaEstatePlanners.com

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Local Trust, Estate and Will Lawyer David M. Frees III recently appeared on the PBS interview program – Spotlight. As many of Frees’ business and estate planning clients already know, in addition to being a respected Pennsylvania attorney practicing in the areas of trusts, estates, and wills, David Frees is also know outside of the practice of law as an expert in the field of family and inter-generational communications skills.

His recent interview included discussions and techniques from two of his books, The Language of Parenting: Building Great Family Relationships at All Ages and his essay on business communications skills – The Language of Abundance in Elite Books’ Einsteins Business. The techniques and strategies reviewed in these interviews included discussions of both family and business communications secrets.

To View Part One of the David Frees Interview (6 Minuets) on Family and Business Communications Skills here.

Frees was quoted as saying: “Those two skills are not as different as they might at first appear. There really is quite an overlap between my practice of law and my study, speaking, and writing on the topics of business and family communications skills.”

Frees added “Most of my clients really value the knowledge and experience that I bring to the estate planning process. I know how families communicate and I can bring this knowledge to their wills and trusts and attempt to avoid disputes.”

Because many of Frees’ clients are also business and family business owners, his knowledge of marketing, business, and family communications skills are also valuable to his clients.

“Quite a few of my clients have worked with me to grow and to pass on their businesses. Many families and business people just work with me to develop their estate plans and estate planning documents, but many others also value my business and marketing background and my skills as a business problem solver.” “I am always happy when I can help clients in multiple ways to not only pass on their businesses but to help them to solve lifetime problems.”

In fact, Frees’ firm, Unruh, Turner, Burke and Frees and David now represent the second and even the third generation of some families and some family businesses.

“That is really quite a nice compliment.” According to Frees, “When more than one generation of a family or family business continues to use our firm, we feel that we have done a good job for them. But, we are always looking for ways to further enhance our value to the client.”

David M. Frees III is a partner of Unruh, Turner, Burke and Frees and can be reached at
610-933-8069.

Frees provided the following additional resources for our readers:

Estate Planning Resources and Reports
Reports For Executors
General and News Updates on Wills, Trusts, Estates, Asset Protection, and Elder Law

These an many other resources are also available from Amazon and many resources can be read on the Amazon Kindle.

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Want to know about an interesting new Federal Estate Tax bill that might get traction in Congress and how you can track it on line? Read on.

A new federal estate tax bill was introduced in the House Ways and Means Committee on October 22, 2009. This bill, known as HR 3905, is called the Estate Tax Relief Act of 2009. While the fate of the federal estate tax is up in the air, this bill might actually stand a chance of getting out of committee as a compromise bill before the end of the year.

It is different than some of the other House and Senate bills. It would slightly raise the exempt amount for next year but will provide for increases thereafter in the exempt estate and also provides for phased reductions in the rate of the tax.

Unlike some bills, it does not address the idea of a husband or wife getting a carry-over also knownas portability of the first spouses exemption.

A review of the bill’s specifics:

The bill will repeal the lapse of the Federal Estate Tax as of January 1, 2010.

It would establish a $3,650,000 exemption equivalent in 2010 (more than the current $3.5 million).

The bill then gradually increases the federal exemption equivalent to $5,000,000 by 2019 and would adjust for inflation thereafter.

This bill also contains reductions in the top estate tax rates over time with continued decreases to 35% by the 2019.

Bottom line? This bill appears to address some of the concerns of both parties and may be a politically viable compromise. If passed and then passed in a similar form by the Senate, it would still require many families to do careful estate tax planning before the death of the first spouse to avoid the tax.

We will continue to keep you posted. And, you can read the bill and track its progress here. Federal Estate Tax News on HB 3905

David M. Frees III has law offices in Malvern, Phoenixville and West Chester
Pennsylvania. These offices serve all of Chester and Montgomery County, Lancaster Berks and
Delaware Counties.

Attorney David M Frees III can be reached by phone at 610-933-8069 or 610-240-0750

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By: David M. Frees III Review David Frees’ AVVO Lawyer Rating.
Wills * Trusts * Estates * Estate Planning * Asset Protection Planning
Malvern, Phoenixville, and West Chester Law Offices

It is that time of year when we start to get questions about gift taxes, the gift tax exemption, and about how much you can give to your children and grandchildren.

This year we are getting a new question for the first time, “I thought that the amount goes up every year so how much can I give this year?”

Well, the reason many people believe the amount of the gift tax exemption (the amount that you can give without paying gift tax or filing a gift tax return) goes up every year is that it is indexed for inflation and has gone from the original amount of $10,000.00 to $11,000.00 and recently, to $13,000.00.

However, the amount does not go up every year. And, because the rate of inflation is so low (or perhaps non existent), the amount will remain the same for 2009 and 2010 unless Congress acts to change it as part of the review of the estate and gift tax that is still pending in Congress.

Quick Facts and Reminders about Gift Taxes:

Each person can give up to $13,000.00 for 2009.

A married couple can give $26,000.00 to each recipient even when one spouse has the assets and the other does not. (This is called a split gift and may require your spouse to sig the gift tax return)

If your child or grand child is married, you can also make a gift to the spouse. However, that gift is not protected in the event of a divorce.

You can make gifts of property, real estate, Limited partnership interests, stock or cash. However, the recipient acquires your basis in the asset and may have to pay capital gains taxes on the gift if the specific property is later sold for more than your basis.

Learn more about avoiding end of year gifting mistakes.

We also have a related article on our Estate Planning Blog on Three Gift Tax Questions
Thank you.

Please leave your questions and comments below.

David M Frees III
Will, trust, and estate planning lawyer
Chairman: Trust, Estate, and Wealth Preservation Section

You can find out more about David Frees and the trust, estate, and asset protection lawyers in the firm at Unruh, Turner, Burke and Frees.

* Note: In Pennsylvania, there are no legal specialties. Lawyers may not refer to themselves as “experts” or “specialists” in trusts, estates, wills, or other practice areas. Therefore, when we make reference to ourselves as will or trust lawyers, we mean only that we focus our practice to the areas of wills, estates and related matters.

To see a list of Unruh, Turner, Burke and Frees lawyers and Unruh, Turner, Burke and Frees practice sections click here.

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Many Elderly clients must decide, is gifting to protect assets from Nursing Home spending right for me? Will I receive the same care if Medicaid pays for my stay in a nursing home? What if I need the money or assets that I gifted to qualify for Medicaid payment of my nursing home costs for something unexpected? Many clients want to protect their assets for their children, but are faced with these and many other questions when considering the Elder Law and Medicaid asset protection planning. The Psychology of gifting for Medicaid can be as important as the legal issues.
Beyond the personal fears, there are also legal issues that must be confronted when making gifts to qualify for Medicaid. The Deficit Reduction Act of 2005 (DRA) provides the basis for gifting qualification. Luckily, there are many planning options available to clients considering making gifts. The most appealing is often the use of the Medicaid Asset Protection Trust which creates creditor and asset protection that will likely allay many of the fears of the elderly client when making a significant gift.
by Douglas L. Kaune, Esquire
Estate Planning & Administration, Wills, Trusts, Asset Protection, Elder Law
Unruh, Turner, Burke & Frees, P.C.
Phoenixville, Malvern, West Chester PA
Pennsylvania Attorney Chester, Montgomery, Delaware, Philadelphia, Berks and Bucks County
dkaune@utbf.com PH: 610-933-8069

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If you are a Pennsylvania resident, your estate is subject to many death taxes including the Pennsylvania Inheritance and Estate Tax as well as the Federal Estate Tax. If you have been watching the news, you know that one of those tax systems – the federal estate tax is due to expire quite soon.

Why?

Congress has yet to act on the pending repeal of the federal estate tax. But, the pressures on our tax system are so great that most commentators feel that they must keep the tax in place. If Congress allows the tax to temporarily lapse, it appears that they might then re-enact it retroactively to the start of 2010.

In addition to being confusing to taxpayers, and raising a difficult constitutional issue, this makes rational estate tax planning almost impossible.

In any case, the question of repeal or repair of the federal estate tax (also known to its detractors as the “death tax”), will almost certainly be the next political hot potato after health care reform is resolved.

Have you made up your mind yet? We try to present many different views on this issue and we welcome your comments. We also encourage you to contact your Congressional representative and Senator to demand action on this vital issue.

Here is an article from the Heritage Foundation on 7 reasons to repeal rather than reform the federal estate tax.

Please leave your comments below.

David M. Frees III
Chairman: Trust, Estate and wealth Preservation Section
Unruh, Turner, Burke and Frees

Offices in: Phoenixville, Malvern and West Chester

wills trusts estates powers of attorney and living wills
estate planning

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First a few preliminaries on the Grantor Retained Annuity Trust or GRAT.

What is a GRAT? GRAT stand for Grantor Retained Annuity Trust. It is a special trust where you can make a gift and get the original amount back over a period of years and the growth of the asset remains in the trust – usually, for children.

Why do people do GRATs? GRATs are often used in times of low interest rates, and low asset values to move substantial growth in an undervalued stock, family business, or even real estate, out to the next generation.

Can you give an example? Yes. Mrs Walton (Sam Walton’s wife) contributed a substantial amount of Walmart stock to a GRAt for her children. The trust had to pay her back the stock (or cash) plus interest over a peiod of years. However, because her stock rose so much in value, even when she was paid back, a great deal of wealth remained in the trust for her heirs. She paid no gift tax becasue the GRAT was structured, so that at the time of the transfer, there was no gift.

Should I get my GRAT done before the end of the year? Well, a GRAt is an irrevocable trust. So, you should thoroughly and completely understand the GRAT before you sign and fund it. However, in the current economic environment, a GRAT can be a very powerful estate planning tool.

GRAts are complicated to set up but once you go through the process, they are fairly easy to use and to administer and the payoff to your heirs can be huge.

Since you must out live the term of the GRAt for it to work it’s magic, careful consideration should be given to how fast the GRAT should pay you back. But, once you know that the GRAt is for you, the sooner you fund it the better.

For more information on GRATs, sign up to get alerts when we post new articles.

Thank you for being a reader and please post your comments or questions below.

David Frees is an attorney who focuses his
practice on wills, trust, estate planning, and related
issues.

David Frees’ AVVO Rating 9.8 “superb”

For a consultation or phone conference call 610-933-8069
By email: dfrees@utbf.com

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Are you considering making end of year estate planning gifts to children, grandchildren or great grandchildren?

Curious about how much you can give without paying gift tax? This brief video tells you how much you can give without paying taxes.

Want to avoid the mistakes that people make that can actually cost your heirs money?

Need to know whether or not you need to file a gift tax return? Click here to get your answer to the question “How much Can I Give Without Filing A Gift Tax Return?”

I just published an article on The Five Most Common Mistakes that People Make with End of Year Estate Planning Gifts, and How to Avoid Them. Be sure to read this article and the two additional artciles on gifting that will be published in the next few weeks.

Make sure that your gifts work, that they count, and that you maximize them without making some of the horrible mistakes that can cost your heirs dearly. Read: End of Year Gift Tax Mistakes and How To Avoid them.

David M. Frees III
Offices: West Chester, Phoenixville, Malvern
Serving Chester County, Montgomery County and
All of the Counties in the Greater Philadelphia Area

For appointments call: 610-933-8069
dfrees@utbf.com
Please leave your questions and comments below.
Thank you for being a reader of our legal blogs and
publications.

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More and more consumers are using Google, local search, and internet tools to help them to find the right lawyer to help with wills, trusts, estate plans and related matters.

But, there are many reasons why searching for “the best” trust lawyer, estate attorney, or probate lawyer could actually get you the wrong information and might actually yield just the opposite of what you’re looking for. For example, many consumer’s do not know that lawyers are not even permitted to advertise that they are “the best” in any given area.

Additionally, there are no recognized specialties in wills, trusts, estates or other practice areas in Pennsylvania. So if you cannot find a Pennsylvania lawyer who “specializes in estate law” or is “an expert in estate law,” then how do you find the right lawyer for your needs?

If you want to know more about how to really find the lawyer or attorney with just the right credentials who practices in the areas of trusts, wills, estate law, and related topics, then see this short report that I just prepared for Pennsylvania residents looking for a lawyer.

Finding The Right Lawyer or Attorney and Not Just “The Best”

Please leave any additional questions or comments below.

Thank you.
David M. Frees III, Esquire.

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