Benefits of a Living Trust vs. Power of Attorney for Finances

Knowing the benefits and drawbacks of living trusts and powers of attorney can help you make informed decisions when creating an estate plan. If you are unfamiliar with the estate planning process, it is best to speak with experienced lawyers for wills and trusts who can evaluate your specific situation and help you understand your options.

What is a Living Trust?

Trusts are often an integral part of estate planning. A living trust is a type of trust that is in effect while you are alive. Like any other trust, assets and property in a living trust are administered by a trustee and are distributed to your beneficiaries upon your death. You may name yourself as the trustee so you can maintain control over your assets. You may also choose a successor trustee who will take over management of assets in the trust should you become incapacitated or pass away.

What is a Power of Attorney for Finances?

Power of attorney enables you to appoint a trusted friend or family member to manage all aspects of your finances if you become unable to do so yourself. This agent can pay bills, buy and sell property, manage your bank accounts, real estate, and investments and handle other financial matters on your behalf. Typically, a power of attorney for finances only goes into effect if you become incapacitated.

Differences Between a Living Trust and Power of Attorney for Finances

Both living trusts and powers of attorney are important estate planning tools. The big difference between the two is that you choose which assets go into your living trust. If you die or become incapacitated, the successor trustee may only manage the trust assets, not assets or property outside of the trust. That is why it is vital to transfer all assets you want to put in the trust while you are alive and functional. You can also specify how you would like your assets in the trust to be managed.

A power of attorney for finances gives the named agent the right to manage all of your non-trust assets. This can include social security benefits, retirement accounts, and other investments that aren’t included in the living trust. Generally, a designated agent of a power of attorney has much more freedom to manage all your finances and assets as they see fit. A living trust gives a trustee very little leeway for committing financial abuse, while a power of attorney gives an agent more power to manage all your finances as they see fit.

Other Benefits of Living Trusts

Depending on the circumstances and how your estate plan is set up, a living trust can help your loved ones avoid the often lengthy probate process. A trust may also provide legal protections against creditors and disputes or challenges to your estate. If you choose to include a living trust and power of attorney for finances in your estate plan, lawyers who provide estate planning services recommend that you make the successor trustee and the designated agent of your power of attorney aware of the relationship between the two. Being informed can help them understand what they will need to provide when engaging in certain actions on your behalf.

Do you need help with estate planning? Our full-service law firm in West Chester can help you create a plan that protects your interests and your family.

This blog was originally posted at https://carosella.com/blog/benefits-of-a-living-trust-vs-power-of-attorney-for-finances/

What Are The Different Grounds for Contesting a Will?

When someone is unexpectedly left out of a will, it is natural to question why and wonder whether it truly reflects their loved one’s wishes. Although it is possible to contest a will on several grounds, you cannot challenge it just because you do not agree with its terms. If you are considering contesting a will, an attorney can evaluate your case, explain the probate process to you and advise you of whether or not you have standing and valid grounds to challenge it.

What is Standing?

Before you can even contest a will, you must show that you have the standing to do so. This means you have to prove that you will suffer harm if the estate is divided up according to the last will and testament’s terms. For example, if your mother passes away and leaves you nothing in her will, you may have the standing to contest it because under Pennsylvania’s laws of intestate succession, children of the deceased inherit a considerable portion of an estate when there is no will.

Grounds for Contesting a Will

Once you show that you have standing, you must also demonstrate that you have grounds for contesting the will. Grounds for contesting a will include:

Forgery. If the testator (person who created the will) did not actually sign it, the will is considered invalid. Typically, the person contesting it or their wills and trusts lawyer argues that the signature was forged.

Fraud. If the testator believed they were signing a different document or couldn’t understand what they were signing, the will is not considered valid.

Undue influence. One of the most common grounds for contesting a will, undue influence involves someone who is close to the testator pressuring them to write a will that benefits them significantly. To contest a will on these grounds, you must show that a testator’s intellect was weakened and they were unaware that they were being influenced.

Lack of testamentary capacity. To contest a will for this reason, you must show that the testator lacked the mental competence to do so. Lack of testamentary capacity is not easy to prove. If you are contesting a will for this reason, an experienced estate law attorney can help you understand what type of evidence is needed and how to prove these grounds.

Improper execution. Each state has its own laws for how a last will and testament must be created and signed. According to Pennsylvania law, a last will and testament must be in writing and be signed at the bottom of the document. Although witnesses are usually not required at the time the will is signed, for a will to be validated by Register of Wills after someone’s death, two people must verify that the signature on the will is the true signature of the testator.

If you are considering contesting a loved one’s will, the experienced attorneys at our law firm in West Chester can help you understand your rights and guide you through the process every step of the way.

This blog was originally posted at https://carosella.com/blog/what-are-the-different-grounds-for-contesting-a-will/

Potential Consequences When Probate is Delayed

Many families feel overwhelmed by everything that must be taken care of after a loved one passes, with everything that needs to be done to properly settle their estate. Although there is no set time limit on how long you have to settle an estate in Pennsylvania, probate and estate lawyers can help you get it done in a timely manner and guide you through the process.

What if Probate is Delayed?

When an estate is not probated and closed in a timely manner, there are various repercussions that may have an impact on the estate, including:

• The statute of limitations for creditors’ claims may be extended
• The value of assets may decrease or they may be lost altogether
• The state may claim assets
• The executor or personal representative may face personal or criminal liability
• Intrest and penalties for late filing of Inheritance tax return

Statute of Limitations for Creditors

In Pennsylvania, creditors have one year from the date that notice of the estate is published in local newspapers to pursue any debts of the deceased. Failing to open an estate right away can result in an estate being in limbo or probate dragging on if a creditor shows up to collect a debt months or years later. If you are the executor or personal representative of an estate and find that you do not have the time or emotional energy to probate a will promptly, an attorney for wills and trusts can help take some of the weight off your shoulders and keep the process on track.

Devaluation of Assets

Assets such as real estate and vehicles are often uncared for when the probating of an estate is delayed. Any outstanding mortgage or loan that is left unpaid can lead to foreclosure or repossession by the lender. If a home is neglected and falls into disrepair, its market value can be significantly reduced. The same goes for a vehicle that is left unattended and unused. In addition, investments that are ignored or mismanaged can suffer serious market losses.

Valuable personal possessions may go missing or decrease in value as well. All these issues can lead to beneficiaries receiving much less than they would have if an estate had been probated and settled in a timely manner. In rare cases, when no heirs can be found, a court-appointed administrator may settle the estate and the state may claim its residual value.

Potential Personal and Criminal Liability

Neglecting to file a will or initiate probate is not a criminal offense in Pennsylvania, but consequences can definitely arise due to a delay. Inheritance taxes are due within nine months of a person’s death, and the estate is entitled to receive a 5% discount if they are paid within three months of the death.

If beneficiaries suffer financial losses due to an executor’s inaction or mismanagement of an estate, they can pursue legal action for damages against the executor or personal representative. An executor may be subject to criminal charges if it is proven that they deliberately avoided filing a will or concealed it for financial gain.

If you need assistance with probate or settling an estate, our estate law attorneys can help.

This blog was originally posted at https://carosella.com/blog/potential-consequences-when-probate-is-delayed/