Powers of attorney are used in the legal field for various different underlying reasons. You are probably aware of the fact that a power of attorney is used to name someone to act on your behalf in a legally binding manner. There are general powers of attorney, and limited powers of attorney. A general power of attorney would give the agent the ability to act on your behalf on a comprehensive basis. In a real sense, the agent could do just about anything that you could do for yourself. With a … [Read more...] about What Is the Difference Between a General and a Limited Power of Attorney?
You should inventory your assets when you are planning your estate for a number of different reasons. Clearly, you want to take stock of your resources when you are thinking about how you want them to be transferred after your passing. In addition to this general inventory, you should estimate the total value of your estate so that you can evaluate your position relative to the estate tax exclusion. The federal estate tax can heavily impact your family's future if you are exposed. This tax … [Read more...] about What Is a QDOT Trust?
If you have been quite successful financially, you must be aware of federal transfer taxes when you are planning your estate. One of them is the generation-skipping transfer tax. Before we look at this tax, we should explain the other taxes on asset transfers, because they are all unified. The federal estate tax is the first transfer tax that we will cover. This tax is potentially applicable on postmortem asset transfers to anyone other than your spouse. There is an unlimited marital … [Read more...] about What Is the Generation-Skipping Transfer Tax?
You may have some impressions about trusts that are not entirely accurate. One misconception out there is the notion that a living trust cannot be contested. Before we get into this specific topic, we should explain a few general things about the value of revocable living trusts. This type of trust is useful for people who want to facilitate efficient asset transfers to their loved ones. It could be looked upon as an alternative to a last will as a primary vehicle of asset transfer. A will is … [Read more...] about Can a Living Trust Be Contested?
Accumulating wealth is a great thing, and you can feel as though you are in a position to help succeeding generations of your family when you have achieved your financial goals. This is true on the one hand, but you also have to take steps to protect your family wealth when you are planning your estate. The federal estate tax is a looming threat to the wealth that you have been able to accumulate throughout your life. This tax carries a 40 percent maximum rate, so we are looking at a … [Read more...] about Can a Trust Protect Family Wealth?
You may be concerned about the federal estate tax when you are planning your estate. The first piece of good news that we will share is that the estate tax is not applicable on asset transfers between spouses. If you are legally married in the eyes of the law, you can transfer unlimited assets to your spouse tax-free. We should point out the fact that there is a federal gift tax along with the federal estate tax, and the two taxes are unified. The exclusion is a unified exclusion that applies … [Read more...] about How Can I Leave My Estate to My Spouse Tax-Free?
People that you know who have looked into the subject may inform you about the benefits of revocable living trusts. Even if you are not extremely wealthy, you can benefit from the creation of this type of trust. With a revocable living trust, you can name a trustee, and you can leave behind specific instructions that the trustee must follow regarding asset transfers. If you have concerns, you can instruct the trustee to distribute assets in a measured fashion over an extended period of time so … [Read more...] about Is There a Difference Between a Living Trust and a Medicaid Trust?
The term "intestate" defines the condition that would exist if you pass away without executing any estate planning documents that state your final wishes regarding asset distributions. If you die without a will or a trust, you would die intestate. Property that is considered to be probate property would be distributed under the intestate succession laws of the state of Pennsylvania. Probate property would be property that was in your direct and sole personal possession at the time of your … [Read more...] about How Is My Property Transferred If I Die Intestate?
The document called a last will is the most common estate planning device. As most people are aware, you can use a will to state your wishes regarding the postmortem distribution of your property. Before we look at the other documents that you may want to include in your estate plan, we should point out the fact that a will is not always the best choice as a primary vehicle of asset transfer. You should explore all of your options and act in a fully informed manner. When you use a will, the … [Read more...] about Do I Need More Than a Will?
You probably have questions about how taxation can affect your estate planning efforts. In this post, we will look at some of the taxes that can come into play, and some of them that do not. Income Tax Since you are required to report just about any income that you receive, you may assume that you have to report an inheritance on your income tax return. In fact, an inheritor is not required to report this income. Capital Gains Tax The capital gains tax is a tax that is levied on appreciated … [Read more...] about Do I Pay Taxes When Someone Leaves Me Money?