Wealth Preservation, Trusts and Estates

Frees has received AVVO's highest ranking of 10.0 Superb

The Houses Passes A New 10 Year GRAT Requirement

On June 15th, the US House passed H.R. 5486 (a “jobs bill”) that contained a requirement that GRATS (Grantor Retained Annuity Trusts) be for a term of at least 10 years.

As readers know, we have been promoting and using GRATs for many clients as a way or moving large increases in wealth without triggering significant gift taxes.

GRATs are often used by clients with rapidly rising stock values, real estate, or other assets with a high probability of significant growth.

The government now views this technique as being just too good for the tax payer and is attempting to restrict it’s use to raise additional revenue.

The main purpose of H.R. 5486 is not, of course, to modify the GRAT rules. It is instead intended to create small business tax relief.

However, as mentioned, GRATs have proven to be a highly efficient technique for transferring wealth while minimizing gift taxes, provided that the grantor survives the GRAT term and the trust assets do not depreciate in value. And, taxpayers have become skilled at maximizing the benefit of this technique, by minimizing the term of the GRAT (thus reducing the risk of the grantor’s death during the GRAT term). Many clients use a term as short as two years.

Under the current bill, now also before the Senate, the minimum term would be ten years. This, of course increases the risk that the grantor might die during the term and the benefit to the family would be lost.

So, while the GRAT will remain a valuable planning tool. The days of the short term GRAT might be limited. If you find yourself moving toward a public offering, a land development plan or some other planning that might produce large value increases, be sure to consult your legal and tax advisers about all of your options in the face of this pending legislation and the appearance that it will pass both houses.

David Frees III, Esquire

David Frees writes on GRATs and other sophisticated estate planning techniques and actively helps affluent families and individuals in Pennsylvania to implement sophisticated estate and estate tax planning.

For more information on GRATs and related estate and asset protection planning call 610-933-8069. Law offices in Phoenixville, Malvern, and West Chester Pennsylvania.

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Will and Trust Reviews - For Free?

The life insurance industry has a vested interest in how the federal government resolves the current estate tax issues. And as tax payers and consumers so do we. If you’re a Pennsylvania resident with assets including life insurance of over 1 million dollars, how this estate tax issue gets resolved may matter to you and your family. So, I thought that you might find this article published by the life insurance sales industry on estate taxes and the current uncertainty to be interesting. Click here to read more about these uncertain times in estate tax planning and what the insurance industry is saying.

Frees has received AVVO's highest ranking of 10.0 Superb

Frees maintains law offices in Phoenixville, Malvern, and West Chester. These offices serve clients in many surrounding communities including Exton, Berwyn, Devon, and Collegeville

To update your will, trust, or estate plan to adapt to the uncertain situation with federal estate taxes, call Donna, Denise, or Beth at 610-933-8069 for an appointment. Mention this article and code Spring2010 for a complimentary initial consultation, and free books and reports.

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Frees has received AVVO's highest ranking of 10.0 Superb

If you have used a lawyer to prepare your trust, you will also find that a well structured estate plan will also contain a pour over will.

Why?

Many people pay the extra legal fees for a living trust so that they can place all of their assets into that trust and escape the need to probate a will. However, the mere fact that you have a trust does not eliminate the need for a will. In fact, a plan without a pour over will is a disaster waiting to happen.

If you have created a trust, your will is still the document that will control assets remaining in your name at the date of death. And, even if you are meticulous in changing the title and account names of all of your assets over to the trust, you may 1) miss an asset, 2) inherit or otherwise receive assets which do not get titled into the trust before your death, or 3) become involved in an accident or other lawsuit that results in an award being paid to you (or your estate) rather than your trust.

If that happens, and you do not have a will, you will then have a partial intestacy and the courts will decide where those assets go based on the Pennsylvania intestate laws.

And if you’re the type of person who wants his or her affairs to be organized so that your heirs have lower costs and simplicity, that is not a desirable result.

So what is the solution?

Make sure that your lawyer prepares both a living trust, and a pour over will. The pour over will is a simple document that instructs your executor (only if needed) to take any assets which remain in your name, and which have not been transferred into your trust prior to death, to be added to and distributed under the trust.

Simple. Inexpensive. And, your plan works.

Trust Warning For Living Trusts Purchased in The Last Ten Years:

P.S. Be sure, that if you have a living trust, that was prepared by a non attorney in the last few years, to consider having it reviewed. It may be fine. However, the Pennsylvania attorney general pursued a number of “trust mills” over the last few years who used non-lawyers – or vague references to lawyers that the consumers never saw. These trusts are often presented in customized binders but the documents themselves are very standardized and may not actually state your true intentions. To make matters worse, many of these trust documents are way too complex and might actually cost your estate money rather than save dollars.

Finally, due to a number of changes in the federal estate tax laws, your trust may be able to be simplified to remove estate tax references and techniques that you might no longer need and which might make your estate and trust costs higher for your surviving spouse or children.

You can have your estate plan reviewed by calling 610-933-8069 and mentioning this discount code for a complimentary consultation – Code: Frees2010.

David M. Frees III is a trust, estate, and estate planning lawyer with offices located throughout Chester County including law offices in Phoenixville, West Chester and Malvern.

These offices serve clients in Devon, Berwyn, Wayne, Exton and Chester Spring as well as many other communities.

David Frees is also the Chairman of the Trust, Estate, and Wealth Preservation Section of Unruh, Turner, Burke and Frees.
dfrees@utbf.com

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Frees has received AVVO's highest ranking of 10.0 Superb

On Friday, December 12th 2009 Chester County Attorney David M Frees was a faculty memeber at the Philadelphia Convention Center to present his well attended program: Estate Planning For Families With Young Children.

Frees, who spoke for the PBI (Pennsylvania Bar Institute) was asked to return to the event faculty for his second year of presenting on this topic. Frees, who Chairs the Unruh, Turner, Burke and Frees Trust, estate and Wealth Preservation section, taught lawyers from around the state about the most important topics for lawyers representing families with young children and how to best serve their clients.

Frees’ topics included many of the best practices in estate planning including: how to help families to select guardians, 2) the advantages and disadvantages of trusts vs uniform transfers to minors accounts, 3) who should be the trustee?, 4) At what ages should distributions be made and how should you instruct the trustees when you’re no longer available?, as well as how to use 529 plans for Pennsylvania residents and, 5) should parents consider a sprinkle trust where there is an age gap between the children and until they graduate from college?

Other topics included planning to protect children and grandchildren from divorce and lawsuits.

Many of the lawyers in attendance have returned to see David on this topic for more than one or two sessions knowing that they will get the latest thinking and a real overview of the pros and cons of many different estate planning options to share with their clients.

If you need to update a will, trust, or estate plan, or if you are the parent or grandparent of young children and want your plan to truly reflect your thinking and wishes, please call Donna or Denise in the office of David M. Frees III at 610-933-8069. Mention this press release to receive a free copy of David M. Frees’ recent report: The Ten Most Common Mistakes Executors Make and How To Avoid Them.

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Forbes Magazine recently published an article listing eight reasons to update your will, trust, or estate plan despite the uncertainty of the federal estate tax. If you have been wondering, whether or not to wait until the dust settles on federal estate tax reform, then read this interesting piece.

And, if we do help you with your estate plan, and the law changes within a few weeks or even six months, then you will not pay for a second round of estate planning. We guarantee, that there will only be a small charge to re-execute your new wills.

So, if you need to revise, or update your wills because of a move, a death in the family, marriage, divorce, new children or grand children, or because of an inheritance, or other changes through time, then please call Mrs. Brownback, or Mrs. Fox at 610-933-8069 or email dfrees@utbf.com to make an appointment with me. If you mention this article, you will also receive a new CD we have produced on Enhanced Estate Planning to protect your children and grandchildren from divorce and lawsuits.

David M. Frees III

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David M Frees III, Esquire has just been awarded AVVO’s highest lawyer and attorney rating of 10.0. Frees heads the Trust, Estate, and Wealth Transfer Section of Unruh, Turner, Burke and Frees with offices in Phoenixville, Malvern, and West Chester, Pennsylvania.

Frees whose practice is limited to trusts, wills, estates, probate, asset protection, and estate planning helps families and individuals to create effective estate tax, asset protection, and business succession plans.

Frees has received AVVO's highest ranking of 10.0 Superb

However, Frees notes that “The firm has lawyers that work in many different areas so that our clients’ needs ranging from personal matters such as estate planning, personal injury and related matters are well protected and served by the firm. And, many other firm practice areas help clients in their business, real estate, and related commercial matters.”

“I am honored to receive AVVO’s highest professional rating. AVVO is one of the premier lawyer search and referral sites on the internet and rates lawyers on a variety of factors. I regularly publish legal guidelines and answer estate planning, will, trust, and probate questions for AVVO users and I believe that it is a powerful tool for consumers.”

Thanks to everyone, including my partners and associates, my support staff, and the other lawyers and clients who have helped me to achieve this honor. I have a great team of people that I work with and great clients that we serve.”

Frees’ offices provide trust, estate, and estate planning services to the entire Philadelphia region, including but not limited to Chester and Montgomery Counties, Berks, Bucks and Lancaster Counties and many communities such as Ardmore, Devon, Berwyn, Paoli, Malvern, Willistown Township, Charlestown Township, East Pikeland, Schuylkill Township, and Doylestown

More information about AVVO rating and search services for Pennsylvania residents can be viewed by clicking this link.

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Attorney David Frees explores how and why you might want to give the gift of a custom domain name to your children and/or grandchildren.

Want to buy your child or grandchild something that may never go out of style, might be vitally important to them in business as they grow up, and is becoming harder and harder to get?

Want to do something for a loved one that not only shows that you care but that might be useful for their entire life?

Want to know the three letters that matter and that might make you a hero to your kids and grandchildren?

The three letters are URL.

URL – That is the web address for a web site that they might use now or in the future for personal or business use. Do you have your name as a domain? Do you own www.insertyournameshere.com for your children and/or grandchildren?

If not, just click on that link and you can find out if your name, your child’s name, and/or a grandchild’s name is still available and if it is you can reserve it and own it for less than $10.00 per year. We have made an arrangement with one of the major web registrars through www.succcessfulurls.com for clients to get a radically reduced cost for registering their names as urls. But, there are many other web sites that also offer this service.

And, it is easy to transfer the web name to your child or grandchild, and easy to set up a simple web site (the kids can do it) so that they can even own the email address theirname@theirname.com for example, John@johnsmith.com rather than john127@aol.com.

Now it is becoming harder and harder to find common names that haven’t been taken. But, it is nice and in some professions (think web designer) to have your own name as your url.

But, while it is becoming harder and harder for children and grandchildren to own their own names many of your children and grandchildren might want that ability. So, if their name is taken how can you still give this gift? well, there are a few tricks.

If johnsmith.com is taken, try www.thejohnsmith.com “www.theoriginaljohnsmith.com” or “therealjohnsmith.com.” You can also try a url using the middle initial such as www.johnpsmith.com or using the full middle name. To experiment, and to reserve a domain name for your child or grandchild, click this link.

So, here’s to hoping that you can find one that works. And, even if you have a new baby, or new grandchild, consider reserving that url. It is inexpensive, fun and may be a really nice present.

Have a great holiday season.

David M. Frees III

David Frees advises clients on estate planning maters related to copyrights,
technology, business succession planning, real estate and other assets which
require careful estate planning. For a consultation, call 610-933-8069.

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David M. Frees III On New Federal Estaet Tax Bill Passes

Today, the hose passed a bill extending the federal estate tax into next year and beyond. The bill passed 220 to 200 with all support coming from the democratic side of the house. This bill keeps the tax rate at 45% and exempts 3.5 million dollars. A married couple can still protect 7 million dollars of assets and life insurance, but it will still take some careful estate planning.

This is just a quick update. The Senate will now have to take up the issue and is likely to change the bill before the end of the year. We will keep you posted.

David M. Frees III

If you estate plan is more than two years old, it may be desirable to change or update the plan.
For an appointment to review or update your plan please call Donna Brownback or Denise Fox at 610-933-8069 or email dfrees@utbf.com and mention this article to receive a discount on your planning.

Unruh, Turner, Burke and Frees maintains offices servicing the entire Philadelphia region, including the Main Line, Ardmore, Bryn Mawr, Berwyn, Paoli, Chester Spring, and the surrounding areas. The firm has a number of probate, estate planning, and trust lawyers.

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If I named my child as a POD (pay on death) or FBO (for benefit of) beneficiary of a bank or stock account and that child is now in financial trouble, can I lose the accounts?

Click here for more essential information on POD and FBO accounts for your children and how to protect your accounts for yourself and for your heirs.

David M. Frees III on Pennsylvania law and the POD or beneficiary designation

Have questions about your estate planning and how your POD or beneficiary designations work with your estate planning documents?

Mention this blog post to receive a free consultation with David Frees or one of the trust and estate attorneys. Call Donna or Denise for more information at 610-933-8069 or email dfrees@utbf.com

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David M. Frees III on The Federal Estate Tax Changes

** Attorneys Practicing in Probate, Trusts, Estate Planning Asset Protection Planning and Elder Law

More Important News On The Federal Estate Tax

There has been a flurry of activity in the House on recent Federal Estate Tax bills as the end of the year draws near and as the lapse of the existing Federal Estate Tax looks more and more like a real possibility. However, Representative Pomeroy has introduced a Federal Estate Tax bill HB 4154 that may be the subject of a vote as early as Tuesday, December 2, 2009.

In summary, this bill will make the exemption of 3.5 million dollars permanent and would not allow for carry over of the spouses exemption. This means that careful planning will still be be necessary for married couples for the foreseeable future and it will mean tax for many families (at a forty-five percent rate (45%).

This bill appears to be less favorable than the bill we discussed last week HB 3905. As you may recall from our blog post, HB 3905 would raise the exemption amount, reduce the tax rate, and increase the exemption through time to five million and then index it for inflation.

In any case, we are actively watching both bills and will keep you posted as they may have an effect on your estate planning.

David M. Frees III, Esquire

Call Donna or Denise at 610-933-8069 for a telephone or in person
consultation for estate planning, asset protection planning, trusts,
wills, or estate matters. Elder law consults are also available if you
or a loved one is facing nursing home issues within the next five years.

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