How Does Bankruptcy Filing Affect any Pending Personal Injury Cases?

If you have a pending personal injury claim, there are some important things to think about before filing bankruptcy. It can be challenging to predict how filing bankruptcy may affect your award. Speaking with local bankruptcy attorney before you take any action is critical.

Defining Personal Injury

When another party or entity causes injury or wrongful death, the person or persons affected may be entitled to monetary compensation for their losses. For example, if a motorist rear-ends you and the accident causes whiplash, they may be responsible for your medical bills, lost wages, pain and suffering and other damages if they are found to be at fault. Personal injury settlements may range anywhere from a few thousand dollars to millions.

Disclosing Your Settlement is Key When Filing Bankruptcy

When going over your financials with your lawyer, make sure to disclose all of your assets, including any personal injury claims. You should also let your personal injury attorney know that you may be filing for bankruptcy so they can share information if necessary.

Regardless of whether you are filing Chapter 7 or Chapter 13 bankruptcy, failing to disclose your personal injury claim and potential settlement is a recipe for disaster. Although in some circumstances a personal injury settlement may be exempt from bankruptcy, if you fail to disclose the claim or do not speak with your lawyer about how to shield your settlement, you may lose it. Your attorney may advise you that bankruptcy might not be your best option if you are going to receive a very large settlement.

A personal injury settlement is considered an asset, just like your home, car and any other personal property. If you fail to disclose a potential claim in bankruptcy court, the funds may be directly distributed to your creditors when the settlement is paid. The court takes a hard line on failure to disclose assets. If you intentionally fail to list it as an asset you may be held criminally liable. If you’ve been injured and you are facing financial troubles, the last thing you want to have to do is hire a defense attorney because you failed to disclose a personal injury claim.

When is a Personal Injury Settlement Exempt?

Typically, the date the claim was filed (usually close to the date of injury) determines whether your personal injury award will be part of the bankruptcy estate. For example, if you were hurt before filing for bankruptcy but will not recover compensation until after the filing, it may not be considered part of the bankruptcy estate. However, you must still disclose the claim. It is also important to keep in mind that in Chapter 13, bankruptcy trustees often check court records after a bankruptcy case is closed. Although it is rare, your personal injury settlement can be seized years after your debts were discharged in bankruptcy.

Personal Injury Claim Exemptions

Bankruptcy exemptions may protect all or part of a personal injury settlement, depending on the type of bankruptcy you are filing. Each state has its own bankruptcy code and exemptions, however, federal exemptions are typically more generous and allow you to keep more. In addition, if your personal injury claim is over the amount allowed by an exception, the federal “wildcard” exemption can allow you to exempt more.

Figuring out exemptions is complex. All of these factors vary from case to case, so if you are considering filing for bankruptcy, having our experienced attorneys evaluate and handle your case is critical to achieving the best possible outcome.

This blog was originally posted at https://carosella.com/how-does-bankruptcy-filing-affect-any-pending-personal-injury-cases/

Estate Planning Errors that You Need to Avoid

Estate planning involves more than just creating a will—there are many different elements to consider to ensure your wishes are carried out as you intended. Proper estate planning not only protects your assets and can provide for your family after you are gone, but vital documents such as powers of attorney can also protect you in the event of incapacitation. Sitting down with an estate planning attorney and creating a plan can give you peace of mind and help to safeguard your assets and loved ones. Here are some common mistakes you might be making while creating your estate plan.

Assuming You Are Too Young To Need An Estate Plan

One of the most common misconceptions about creating an estate plan is that only older people need to have one in place. Accidents and illnesses happen, and just because you are young it does not mean that you are immune to suffering debilitating injury, illness, or death. If you have children, it is even more critical to create an estate plan, regardless of whether you have substantial assets. The last thing you want is for the court to decide who will care for your children. If you do not name guardians for minor children, they could end up with someone you would not have chosen.

Having adequate life insurance, a will, powers of attorney, trusts, and other estate planning tools in place is one of the best gifts you can give your family. A probate lawyer can also advise you on the most effective way to enable some of your assets to avoid going through probate, which can save your loved ones time and money.

Failing to Create Powers of Attorney and an Advance Directive

It may be unpleasant to think about, but you never know when something could happen that leaves you incapacitated and unable to make decisions for yourself.  These three vital documents can help to ensure that someone with your best interests at heart is responsible for making important decisions on your behalf:

• A Power of Attorney for Health Care is a legal document that allows you to name an agent who has the authority to make medical decisions for you should you become unable to do so yourself. Consulting a lawyer who deals with wills and trusts can help you make an objective decision about who the right person for the job may be.
• An Advance Directive, which is sometimes known as the Living Will, lays out your wishes for life-sustaining treatment like a feeding tube or ventilator. In the age of COVID-19, having an Advance Directive in place is more important than ever and can save your loved ones a lot of heartache and stress.
• A Power of Attorney for Finances gives you the opportunity to name an agent who will handle your financial affairs in the event of your incapacitation. This means they can pay bills, manage your assets and investments, buy and sell property, and perform other tasks related to your finances.

Planning your estate can be daunting, but it doesn’t have to be difficult. Whether you need help updating your estate plan or you are starting from scratch, our full-service law firm in West Chester can assess your circumstances and advise you of the most effective course of action to protect your rights and interests.

This blog was originally posted at https://carosella.com/estate-planning-errors-that-you-need-to-avoid/

Property Inheritance in Blended Families: Understand the Strategies

Blended families have been the new norm in the United States for some time now. Family dynamics can be complicated and blended families face their own unique challenges when it comes to estate planning. Ensuring that everyone feels valued can be tricky, especially if you feel the need to protect assets from someone who may not have the best intentions.  It is also important to understand the potential for some members of the family to become unintentionally disinherited down the road. An experienced estate lawyer can identify potential issues and roadblocks and help you create an estate plan that protects everyone’s interests.

Resolving Inheritance Questions For Blended Families

There are many different ways to be proactive so your children and other beneficiaries do not have to deal with inheritance problems after you are gone, including:

• A well-crafted will that takes possible future scenarios into account
• Pre- and post-nuptial agreements
• Changing beneficiary designations on life insurance policies and accounts
• Trusts

A family wills and trusts attorney can help you find options that meet your specific needs and family situation.

Trusts

A Qualified Terminable Interest Property (QTIP) is an irrevocable trust that can be a useful estate planning tool. If you have had multiple marriages and want to make sure your assets go to your children from an earlier marriage after your current spouse’s death, A QTIP may be a good solution. By establishing a QTIP trust, you can provide for your surviving spouse for the rest of their life, but once they pass away, the funds in the QTIP are distributed to beneficiaries as specified by the grantor of the trust (you). The surviving spouse cannot make any changes to the trust or add additional beneficiaries, so a QTIP is a reliable way to ensure your assets are distributed to the beneficiaries you choose, even after your death.

An Irrevocable Life Insurance Trust (ILIT) is a trust that is specifically set up to own a life insurance policy. After your death, life insurance policy proceeds are placed in the trust and will go to the beneficiaries you specified when the trust was created. These proceeds do not have to go through probate and an ILIT can help to ensure the children you designate as beneficiaries are not disinherited.

When setting up any kind of trust for estate planning it is usually a good idea to choose a neutral party to be a trustee or fiduciary, especially in blended families. If you have a longstanding relationship with a contracts lawyer, accountant, or another professional you trust, naming them as trustee can help cut down on family conflict and stress.

Update all Critical Estate Planning Documents

Forgetting to update your will or beneficiaries on insurance policies when you get remarried can have disastrous consequences for your beneficiaries. Once you marry a new spouse, your previous will may become invalid according to the laws of intestacy in Pennsylvania. Beneficiaries on insurance policies must also be changed—in the event of your death they will be paid to whomever you last named as beneficiary, which may be your former spouse. If you are considering a new marriage, a prenuptial agreement can also be an effective way to specify what your spouse is entitled to and how you want your other assets to be distributed upon your death.

If you want to learn more about estate planning for your blended family, the team at Carosella & Associates can help.

This blog was originally posted at https://carosella.com/property-inheritance-in-blended-families-understand-the-strategies/