Wealth Preservation, Trusts and Estates

Do you want to be invited to any of our upcoming
executor, trustee, and/or estate planning social and
educational events?

Getting The Invite Is Easy

Here’s How

Each year David Frees and
Douglas Kaune sponsor
a series of events for the
readers of our articles and
for our clients to say thank you.

We appreciate your kindness
in selecting us as your attorneys and for allowing us
to represent your families’ estates and to help in
preparing estate plans to protect you and your heirs.

We also appreciate all of the referrals your friends,
co-workers, professional colleagues, and family members.

And, we know from your questions, that you and many of the
people that you refer need more information about certain
similar topics.

So we have a few up coming events based on your questions
and comments and we’d like to know more so that our winter
and spring events can be customized to your needs.

Upcoming Events:

How Do Estate Auctions Work? – Selling The Family Heirlooms
That Aren’t Really Heirlooms.

Many clients have asked about how
estate auctions really work.

And, over the years we have noticed,
that many families have collected
furniture, art, and other things which,
while holding great financial value,
are not always high in sentimental value.

So, when heirs and executors have distributed the antiques, art
and other personal effects, there are often vary valuable articles
to be sold or liquidated.  And, high end auction houses are
one way to maximize value to the heirs and to protect an executor
from liability.

For that reason, we have arranged, through our connections
at one of America’s oldest auction houses, to host a preview
party for our clients who are interested in how high end estate auctions
really work.

If you’re interested in this topic, in attending the event, or in more
information on estate auctions, please leave a comment below of
email me at dfrees@utbf.com and mention estate auctions in the
subject line. You can also call 610-933-8069 and asked to be
added to the invitation list for the auction event.

Once you’re on the list you’ll be sure to get an invitation.  If you
cannot attend we’ll also be sure to send you additional information
after the event.

Other Possible Events:

1) SeptemberFest – A beer tasting event at the home
of David and Robin Frees.

Last year’s wine tasting event was a huge hit with all who attended.

Every guest received a number of Napa Valley wines to try
and the Frees family hosted an awesome dinner of fish, steaks, and salads.

This year, the SeptemberFest Beer event was canceled due to
the Frees’ Jack Russells who tangled with a rabid
raccoon and the resulting 90 day “quarantine” at the Frees house.

The Frees Hounds befoer the rabid racoon arrived

But, next year we plan a September Beer
Event with a local brew master who will
lecture while you taste.

If you’re interested in this purely social
event – no legal lectures -then leave a
comment below, call Lisa at 610-933-8069
or email David at dfrees@utbf.com to
be added to the list.

Vote for Your Choice:

In addition to the two above, we’re also considering the following
events.  Call, email, or comment below to cast your vote and
to be added to the invitation list.

2) The Estate Tax Law and 2012 -What Happens Now That
Everything You Know About Estate Planning
Might Be Wrong?

This will be a wine and cheese or lunch and learn to
deal with the pending changes at the end of 2012.

3) Free 20 Minute Will Reviews

Hard to imagine lawyers giving away free advice but it’s
true for a limited time and for a limited number of clients.

Throughout the year we sponsor will
review days.

Not sure if your will, trust, or power
of attorney
are still good?

Has a long time passed since
your last update?

You might be fine or you might need an update.  These short
appointments are free.  Call 610-933-8069 to get on the list.

Have another Suggested Event?

There are 3  ways to let us know and to
get on the guest list for any event suggested
and that we decide to host:

1) Leave a comment below,

2) Call 610-933-8069 and ask for Lisa
or

3) E mail David Frees at dfrees@utbf.com with any
question or event suggestions.

We’ll make sure to add you to
the invitation list for any and all of our
events that you want to suggest and/or attend.

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Are You The Executor of A Pennsylvania Will or Estate?

Want To Avoid The Pitfalls of Probate and The Personal
Liability When Executors Get Sued?

This new article and video reveals some of the best ways
for executors to:

Avoid Getting Sued and Being Personally Liable to Estate Beneficiaries

Get Information and Resources To Reduce Costs and Avoid Trouble

Click here for access to several brief videos for estate executors

For more information or our report: The Ten Most Common Mistakes
Executors Make and How To Avoid Them click here or call toll free
to 1-888-573-7407 and ask for Lisa or Tammy.  They
will make sure that you get a hard copy of the report.

David Frees on Executor Resources and Preventing Liability

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Want Your Estate Plan To Really Work ?
Most Plans Don’t.

If You Have A Clear Desire To Leave
A Legacy and To Protect Your Heirs
You Need Your Estate Plan or Will To Be Clear,
Loud, and Effective.

If You Want Yours To Actually Work, Then Here
Are The Must Know Strategies and Steps To Ensuring
That Your Plan is Clear and Really Works…

Estate and Trust Attorney - David M. Frees III

Really?
Most Wills and Estate
Plans Don’t Work?

True.

Most people, even many
wealthy people, don’t even
have a will.  And, of those
who do a will, most will fail
to carry out their wishes.

Why?

Because they fail to take the few additional steps
and the couple of extra steps that really make the
difference.

These steps to success aren’t a secret.

But they are unknown to many people and in many
cases, to their lawyers.

So if wills and estate plans don’t work, why bother?

It’s not that wills don’t work. They can and do.

It’s just that most people (even many affluent people)
don’t take the time, or spend the tiny bit more money
to make them work properly.

They just need a few strategies and a
few extra hours of time to make the plan  work
many times better, to save more money, and to
create much more effective protection.

And, to make matters worse, many people, and/or
their advisers often ignore the important step of
getting clear about what they want, who gets what,
when they get it, how they can use it, and how these
assets can be protected.

Finally, even if they take these steps, they often fail
to coordinate how they hold their wealth and assets with
what the lawyers and advisers have done in the estate
planning documents.

This article presents a brief review of some of the essential
strategies, and the specific steps designed to protect your
heirs from losing their inheritance to taxes, divorce,
frivolous litigation, fees and estate expenses.

Take just a few more minutes to read this article and
I can guarantee that you’ll be a much better consumer
of estate planning services, and that you’re estate plan,
will or trust will be many times more effective.

Let’s get started.

Do you have a business, stock ownership, a second home
or other assets that you want to leave to others or to a charity
as a legacy of your time and effort throughout your life?

Do you have a son in law or daughter in law that
has values that differ from your own?

Have you ever worried that a son or daughter might
get divorced and lose an inheritance to an ex spouse?

Do you care how and when your heirs and beneficiaries
get the assets?

How they are protected from lawsuits,
taxes, divorce and creditors?

Even if you think that you don’t care because your gone
when your kids inherit these assets, do you have any desire
to protect assets and wealth for grandchildren, charity or others?

So, if your definition of a successful estate plan is one that
protects your heirs from losing their inheritance, from taxation,
from will contests, legal expenses, and from other risks, then
you’ll want an estate plan that really works.

So what are they key strategies and steps to a successful will,
trust or estate plan?

Strategy #1  Get Clarity First -
About Your Assets and Your Wishes

This will save you time, money and, when coupled with
the right estate planning documents and your voice, will
send clarity to all involved.  It’s the opposite of mumbling.

This sounds simple and obvious. But, I have had 8,000 clients
over 25 years and I personally still see hundreds per year.
And more often than not, they come to me before they figure out.

As you can imagine, that’s not good for them and it’s hard for
us to create a plan that does exactly what they want when they
haven’t even figured it out.

And, if your married, this involves clarity and a uniformed vision
of two minds not just one. And, anyone married beyond the
honeymoon knows that agreement on all of the issues of estate
planning doesn’t always come easy.

So what’s the solution?

What are the specific steps you need to take?

First get a net worth statement together. Know what you have,
how you own those assets, and what they are worth.  With the
right kind of guide, this isn’t as hard as it sounds. And, it’s essential
information that any effective estate planning lawyer will need
to do the job for you.

And if you want a great estate planning tool, download my
Estate Planning Questionnaire or order my Definitive Guide to
Enhanced Estate Planning (for this guide, call 1-888-349-5016)

Second, married or single, start with your personal set of estate
planning goals.  Be clear about what you want.

How do you get clarity?  Ask yourself these questions.

What legacy do you want to leave?

Who gets what?

When do they get it?

Are there restrictions on the uses of such an inheritance?

Are you worried about divorce or lawsuits?

Do any heirs have special needs?

Do you have charitable intentions?

Are just children included or are there
direct gifts to grandchildren or others?

Do you have a charitable intent?

Who are the executors, trustees, guardians,
trust protectors, and other fiduciaries?

Are they the right people or institutions?

What do they have to do?

Now, if you’re married, you have to work with your
spouse to meld these two – often very different
sets of goals, aspirations, and if there are children
from multiple marriages, or a blended family, then
the issues are even more complicated as
both spouses will want to protect one another and their
children by this and/or prior marriages.

That brings us to the next and final step.

Strategy #2 Get the right attorney.

So how do you do that?

Start again by asking the right questions.

Most people want an attorney who is local and
convenient.  But, if all other factors aren’t met you
can often find an attorney who is right for you within
a thirty to forty five minute drive.

This extra investment of time should pay real dividends.

How?

Most lawyers don’t have extensive experience in estate
planning.  A general practice lawyer might be right for a
young couple just starting out.

But when you have a family
business, when you’re a n executive, a business owner,
or when you have extensive assets, vacation homes, or
hard to value assets, then more experience may be called for.

One of the best ways to find the right lawyer is to get a referral
from your own lawyer, accountant, or other friends or family
members with situation similar to your own.

In fact, most of our clients are referred to us by their lawyers,
affluent or wealthy friends, family members, or other advisers.

Of course, it’s great when someone who you trust
(or even more than one) gives you the same name and a glowing
legal recommendation.  That’s a great place to start.

Consider calling that lawyer for an appointment, but be sure
to ask if there is a consultation fee for the first appointment.
Many good lawyers offer low or no fee initial consultations.
But many good estate planning lawyers also charge.  It’s just good to
know in advance.

But, if you don’t get a clear referral, or, if you want to know
more about the lawyers in your area, then you can also use lawyer
rating services like www.Avvo.com or Main Line’s Top Trust and Estate
Lawyer Designation or SuperLawyer designation.
You can click those links to see a sample of my profiles at those sites
or to search for other lawyers with those ratings.

Finally, it might also be helpful, or reassuring to Google some
of the estate planning questions, and issues that are important to
you.

Does a law firm or lawyer in your area or community consistently
come up in the search results?

Do they offer great and informative information?

Do they represent other clients like you?

Do they have experience with special needs trusts (if you have a
child or grandchild with a disability or special need)?,

Are they experienced in the tools and techniques of wealth transfer,
such as gifting, GRATS (if you own rapidly appreciating assets),
Qualified Personal Residence Trusts
(if you have a vacation home or valuable primary residence),
ILITs (if you have or plan to buy life insurance)?

And, if this sounds too complex, don’t worry.

You may not need or want any of these particular tools.

But, what you do want is a lawyer
who knows all of the options.

Once you learn them, then it’s up to you to choose what
your estate plan looks like and how it works.

You want a lawyer that can discuss these options.

These are a few of the ways to make sure that you have clarity,
and get the right lawyer to help you and a spouse (if you’re married)
to devise a clear estate plan and the documents to carry it out.

Finally, you need to go the extra mile to make sure that your
plan is clear, that it works, and that it is designed to save your heirs
time and money, and if desired, that it also protects them
from lawsuits and divorce.

This means hiring a lawyer or law firm that will help you
to coordinate your assets and to structure your affairs to match
and to compliment the documents, tax clauses, wills and trusts
that make up your estate plan.

You’re also going to want a lawyer that can coach you on:

how to avoid will contests,

how to create estate planning memos

how to hold family meetings when explaining the plan,
the trusts, and the strategies is desirable.

There’s more to great estate planning than this, but if you follow these steps,
you’ll be well on your way to creating a successful, powerful, and
effective legacy and avoiding the will contests, taxes and litigation
that often results when families fail to plan.

Strategy #3 Take Action, Get It Done and Feel Better

Don't gamble with the future of your heirs - Get The Estate Plan Done

So stop saying “I’ll get to it tomorrow or
next year. ”

Get your planning done right and you’ll
make your spouse and heirs very happy.

You’ll check it off of the long to do list
and you’ll feel better – much better.

For more of our free reports, a free copy of our
Enhanced Estate Planning Questionnaire, or information about
Family Meetings call 1-888-349-5016.

David Frees Chairs The Trust, Estate and
Wealth Preservation Section of the firm.

He can be reached by email at dfrees@utbf.com
or by calling 1-888-349-5016.

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What is the Federal Estate Tax exemption and rate for 2011 and 2012 and Beyond?

In the past month the estate tax has been back in the limelight.  As most of you know, in December of 2010 President Obama signed the Tax Relief Act of 2010. Prior to the ratification of the present law, the federal estate tax was repealed for the 2010 tax year.

For 2011 and 2012 we have the largest federal estate tax exemption at $5 million and the lowest federal estate tax rate of 35% in the last 50 years.

There has been rampant speculation as to what will happen when the present law is set to expire at the end of 2012.  Some say the estate tax will revert back to the 2001 exemption rate of $1 million and a tax rate of 55% others say this Act was the beginning of the end for the federal estate tax and still others believe the law will stand at the present exemption and tax rate.

Recently, President Obama addressed this very issue. On the final stop of President Obama’s three state Midwest bus tour in Alpha, Illinois someone asked about the future of the estate tax.  The President addressed her and many others’ concern over what will happen for 2013 and beyond.

The president explained that at the end of 2012 the estate tax does not have to go back to the 2001 rates and that there is a compromise being discussed that would put the estate tax exemption at $3.5 million per person for a potential total of $7 million per family. This mid level proposal would exempt a large segment of the population, but would still serve to tax the “wealthy.”  This statement by the President is by no means a definitive word on what will transpire at the end of 2012.  It is nice to get insight into his thoughts and to know that the topic is being discussed.

The final disposition of the Federal Estate Tax law will be important to you and the planning you have done under your will and/or trusts. Maintain your vigilance on this topic so you can ensure that your estate plan reflects the most current law and you get the most out of any changes that are made at the end of 2012.

As the war on the federal estate tax rages on let me know what you think?

Do you think President Obama’s compromise of an estate tax exemption of $3.5 million per person for a potential total of $7 million per family is fair?

Do you think the federal estate tax should be repealed for good or that the tax should apply to more people at higher rates?

To read the full transcript of President Obama’s answer to a question about the estate tax on the last stop of his bus tour in Illinois click here.

Click here to read our brief article U.S. Rep Ross Wants To Kill The Estate Tax

Stay tuned for updates on the future of the federal estate tax and what that means for you, your will and/or trusts.

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The Answer May Not Always Be What You Expect

Simply “Probate” means at death an estate (the deceased person’s property) is administered and supervised by the court, often called probate court. The court will make sure the Last Will is administered correctly and if there is no will state law is followed by a court appointed administrator.

Does Your Will Dictate What Happens To All Your Assets?

Many people ask us how they can “avoid probate” before they understand what it means and how long it will actually take. For example in Pennsylvania it is a fairly straightforward process, many cooperative families can “opt out” of much of the process, and it takes as few as several months and can be helpful in making sure the executor, the person who distributes the property, does what the Last Will says to do and that he or she is protected from subsequent claims and law suits.

Many people also do not know that most property transferred at death passes outside of probate through a non-probate mode of transfer. Here are some examples of things that do not go through the probate process and may not even be distributed according to the will.

1. Joint tenancy property both real and personal

The decedent’s (the person who has just died) interest ends at death. The survivor has the whole property.  Bank accounts, brokerage and mutual fund accounts, and real estate are often held in joint tenancy, particularly between married couples. At the death of the first, this property generally transfers directly to the surviving joint account holder or joint tenant on the deed no matter what the will says. These assets are still taxable for both State Inheritance Tax purposes and possibly for Federal Estate Tax purposes. And, who pays that tax is often a function of the tax clause in the will. Be sure to get good legal advise on this issue.

2. Life Insurance

Life insurance proceeds on the decedent’s life are paid by the insurance company to the beneficiary named in the insurance contract. However, while such policies are not taxed by Pennsylvania, they are taxed for Federal Estate Tax purposes.

3. Bonds & Contracts with payable on death (POD) provisions

Federal E and H Bonds, and pension plans often have survivor benefits as do tax-deferred investment plans such as IRA’s 401(k)’s, and brokerage accounts if there is a death beneficiary. While the beneficiary of such accounts receive the money directly, the proceeds may or may not be taxable for Income Tax and or Inheritance and Estate Tax Purposes.

4. Interests in Trust

Do You Have A Trust?

When property is put in trust, the trustee holds the property for the named beneficiaries. The trustee in accordance with the terms of the trust instrument invests, holds and or distributes the trust property to the beneficiaries.

To read our trust guide How To Find The Right Trust For You click here.

Property in a testamentary trust does pass through the probate process but an inter vivos trust during the decedents’ life does not.  To read more about inter vivos gifts read Should I Make Gifts Now As Part Of My Estate Planning.Such trusts if revocable during your life are Taxable but irrevocable trusts may avoid taxation for Death Tax purposes.

Distribution of non-probate property does not involve a court proceeding.  The controlling contract, trust, or deed terms control the distribution of the property.

Distribution of probate property under a will or an intestate estate (someone who dies without a will) may require a court proceeding involving probate of a will or finding of intestacy followed by appointment of a personal representative to settle the probate estate.

Find out the best way to utilize both the probate and non-probate process in planning your comprehensive will and trust.

A successful comprehensive estate plan takes all of these factors into account when organizing your will or trust.

Whitney O’Reilly

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Learn What To Do To Successfully Obtain Guardianship.

If you have exhausted your options and you are not able to obtain a general financial power of attorney (FPOA) and medical power of attorney (MPOA), it might be necessary to seek guardianship of an elderly or disabled person.  It is important to know that the guardianship is not automatically granted.  The local Orphans’ Court in Pennsylvania (PA) will oversee the process and make a final determination as to whether or not guardianship should be granted.

Any time you have a court process and adjudication there is an opportunity for someone to file a contest and seek a different result.  It is very important for you to foresee the possibility of a guardianship contest and to prepare to answer the challenges.  For guardianship over the elderly or disabled persons, make sure that the medical records and testimony can substantiate the need for guardianship.  Have concrete examples of why the guardianship is needed and how harm will come to the person without the guardianship.  Finally, be ready to demonstrate why you are the best person for the job.  Have all of the necessary witnesses, evidence and answers ready in advance of filing.  It is always easier to gain success when you are properly prepared.

Please contact Doug Kaune at 610 933 8069 or dkaune@utbf.com if you would like assistance with your guardianship matter.

Doug is a Partner with Unruh, Turner, Burke & Frees, P.C. with office locations in Phoenixville, Malvern and West Chester serving all of the counties and towns in South Eastern Pennsylvania.

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