Blog & Resources

Summary: In 2014, a trust utilizing Crummey powers allows an individual to contribute $14,000 a year ($28,000 for married couples) into a trust without diminishing the lifetime gift tax exemption. Instead, the gift is exempt from the gift tax under the Annual Gift Tax Exclusion. These gifts can help avoid the 40% Federal Gift Tax, preserving wealth for the family.

Addressing your blended family in your estate plan is a good idea. Though you may not wish to treat your step-children the same way you treat your biological children, by at least mentioning them or giving them a small gift you may avoid hurt feelings and potential conflict.

Pennsylvania allows you to form a Revocable Living Trust. These trusts can own almost any asset including bank accounts, autos, stocks, gold, and Bucks County real estate. While Revocable Trusts can serve many purposes, the primary goal is to avoid probating the will with the Bucks County Register of Wills.

The Pennsylvania Inheritance Tax is levied on the net estate value, meaning the fair market value of the estate’s assets less expenses and debts.

Addressing your blended LGBT family in your estate plan is a good idea. Though you may not wish to treat your Partner’s children the same way you treat your biological children, by at least mentioning them or giving them a small gift you may avoid hurt feelings and potential conflict.

With one exception, if a Pennsylvania resident dies before reaching the age 59½ his IRA is not subject to the Pennsylvania Inheritance Tax. This is because of a Pennsylvania rule stating that there will be no tax levied on the value of any retirement plan for which the deceased would have been penalized had he removed the funds during his lifetime.

Making gifts to nieces and nephews for Pennsylvanians forces the calculation of the Pennsylvania Inheritance Tax. The tax is levied on the transfer of your assets at your death, and the rates differ depending on who is the recipient.

Changing your bank account into a Joint-Ownership account with your daughter or making her the account’s Payable-On-Death beneficiary avoids probate, but these are different tools addressing different situations and goals.

Life insurance is not subject to the Pennsylvania Inheritance Tax, making it an excellent tool to make gifts to those who would otherwise be subject to the tax.

To avoid interest and penalties, the Pennsylvania Inheritance Tax must be paid within 9 months of the date of death. As executor, you are responsible to make the payment. If you delay and interest or penalties are created, the beneficiaries may demand that you be held responsible.