Klenk Law

Who Needs an Estate Plan?

Posted on Wed Jan 22, 2014, on Estate Planning

The short answer is everyone. The plan might be simple or complex, but without a plan you might not address avoidable family conflicts and tax problems.

At a very basic level, you should have a general durable power of attorney and a health care power of attorney designating who has power to act for financially and medically if you are ever incapacitated. In the past, serious accidents left people dead. Now those same people recover, but often with long hospital stays. If you were in the hospital for weeks or maybe months, who would authorize your treatments? Who would pay your bills and deal with the insurance company? Without a general durable power of attorney and health care power of attorney, friends or family would have to spend thousands of dollars petitioning the Bucks County Orphans’ Court to have someone appointed to make these decisions. The judge would be free to appoint whomever the judge deemed best suited to care for you, which might not be the person you would have chosen.

If your estate is not large and your family situation not complex, your Bucks County estate-planning attorney can help you by crafting a general durable power of attorney, health care power of attorney, and drafting a will. Depending on how you want your assets divided after your death, you could have a simple will that simply appoints an executor to gather your assets, pay your final debts and to distribute your assets outright to your beneficiary. If your beneficiary is an underage child or someone with creditor issues, a simple will is likely not the best tool and your Bucks County estate planning attorney can help create a will with protective trusts.

If your estate is large or your family situation complex, your Bucks County estate planning attorney can help craft various trusts, such as a disclaimer trust, dynasty trust, irrevocable life insurance trust, or asset protection trust, to address your specific assets and your goals. There are various ways to preserve your assets and reduce or avoid inheritance taxes and estate taxes at your death. These techniques are more complex, but the potential tax savings they deliver can easily offset their expense.

If you don’t work with an estate-planning attorney to develop an estate plan, your assets will pass according to the Pennsylvania intestacy rules. These rules were created to sort out the estates of Pennsylvanian’s who failed to write wills (See my article, Intestate succession in Pennsylvania (Who Gets Your Stuff if you Die Without a Will in Pennsylvania). You will see in the article that while Pennsylvania is a possible beneficiary of your estate, it is far more likely that some relative of yours will inherit. By working with your Bucks County estate-planning attorney, you might discover that there is a charity or friend that you would much rather inherit your assets than a distant relative. You worked hard to earn your assets, why shouldn’t you get to decide who enjoys them after you have died?

An estate plan can be simple or complex, but putting together an estate plan is important for everyone. Consult with your Bucks County estate planning attorney and see what plan fits you best.

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