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Frequently
Asked Questions
Will a
Revocable Living Trust save taxes?
No, a trust
does not avoid Pennsylvania Inheritance Tax. Although there are
vehicles in which you can lessen your state inheritance tax.
Please contact us for details.
Yes, it will
help with Federal Estate Taxes for the Unified Tax Credit, give
to both husband and wife for large estates over $2 million.
Will a Trust keep my estate from being spent down for nursing
homes?
No,
by itself a Revocable Living Trust would not protect your
property from Medicaid. However, by proper planning i.e. nursing
home insurance and/or selling your property before you incur
nursing home expenses, you can avoid the loss of your home to
Medicaid. While both husband and wife are living, there is no
recovery or lien to the property, unless both are in a nursing
home.
What happens if Senior Estate Associates goes out of business?
Similar to a will, if the attorney would predecease you or
retire, you still have a will. Consequently, the same is true
for a trust. The trust is still valid.
Does everyone need a Revocable Living Trust?
No,
if you don't own property or have assets over $75,000, you don't
need a Revocable Living Trust. You still need Asset and Health
Care Power of Attorneys and a Living Will. For persons that
don't own property, but have other assets i.e. savings, C.D.'s,
stocks, bonds, etc. there are vehicles to protect these monies
and avoid probate without use of a Trust.
Can I transfer assets to my children when I am living?
Yes
you can, BUT there are numerous reasons not to and here are a
few:
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You no longer own the property and it can
be sold at anytime.
If your child predeceases you, there will
be Pennsylvania Inheritance Tax that will be owed.
Your assets will be subject to your
children's creditors, including lawsuits and
judgments against them and there could be a lien
placed on your home.
You lose the Stepped-Up Valuation. The
concept of stepped-up valuation is almost totally
unknown to most people, but it is one of the most
important concepts that should be understood by all
people who wish to preserve as much of their estates
as possible for their heirs. Stepped-up valuation is
one of the key reasons why a well-drawn Living Trust
can minimize and, in most cases, eliminate capital
gains taxes on the eventual sale of highly
appreciated assets (such as the family home).
Source: The Living Trust, by Henry W. Abts
III.
Everything not in joint tenancy must go
through probate.
If you have any questions that are not answered
here, please contact our office and we will be happy
to have one of our attorneys help you. |
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