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.

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.

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.

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.

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

For some estates, spending a little money now to avoid probate at death can create a substantial savings for the family. Typical techniques used to avoid probate include Revocable Living Trusts, Jointly Owned Accounts and Payable-on-Death designations on bank accounts and stock accounts.

For some New Jersey estates, spending a little money now to avoid probate with the Camden County Surrogate at death can create a substantial savings for the family. Typical techniques used to avoid probate in New Jersey include Revocable Living Trusts, Jointly Owned Accounts and Payable-on-Death designations on bank accounts and stock accounts.

If you die without a will in New Jersey you are said to die “intestate”. If you die intestate, your probate assets are divided up under the New Jersey Intestate Rules. These rules can easily be avoided by writing a will, but if you do not have a will, the Intestacy Rules are in place to clearly state who inherits your probate property in order to avoid conflict.

Your IRA is subject to the Pennsylvania Inheritance Tax, which can prove to be a tax trap.

For example, if you leave $100,000 from your IRA to a friend, that gift is subject to the 15% Pennsylvania Inheritance Tax rate. To avoid interest and penalties on the Pennsylvania Inheritance Tax, within 9 months of your death your friend must pay the Commonwealth $15,000. If your friend does not have $15,000 of liquid assets, she may have to remove the $15,000 from the IRA. If she does, this will trigger her to recognize $15,000 of income. If she does not have the liquid assets to pay the income taxes due on the $15,000, she may have to remove the money from the IRA, which triggers even more income taxes.