Lamb McErlane's Estates and Trusts Department plans and administers estates and trusts ranging from a simple will to estates worth hundreds of millions of dollars of ultra-high net worth individuals.
We are counselors to individuals, families, closely held businesses, and tax-exempt organizations. The group provides the following services to meet clients’ needs:
Estate and Tax Planning
Wills, trusts, powers of attorney for business and health, family partnership agreements and gift planning
Representation of individual and corporate trustees and executors as well as beneficiaries in disputes involving estates, trusts and related matters before the Orphans Court as well as all necessary appeals
Formation of private foundations and charitable trusts and filing for tax exempt status
Cooperation with Business Practice Group
Estate and succession planning frequently goes hand-in-hand with prudent business planning. For these situations, the Estates and Trusts Practice group works efficiently and seamlessly with the Business Practice Group to ensure holistic and comprehensive solutions for our closely-held business owner clients
What Are The Essential Estate Planning Documents?
Estate planning is the systematic approach to organizing your personal and financial affairs to deal with the possibility of mental incapacity and death. Depending on your current family and financial situation, your estate plan will include three or four essential legal estate planning documents. Following is a list of four important legal documents and their purpose:
- Last Will and Testament
Your Last Will and Testament will contain a detailed list of instructions as to how your property should be distributed after you die. If you have minor children, it will contain certain provisions for designating a guardian for your children and a continuing trust for them until they reach certain ages.
- Durable Healthcare Power of Attorney and Living Will
A Durable Healthcare Power of Attorney, sometimes called an Advanced Medical Directive, allows you to designate a healthcare agent, usually a family member, to make medical decisions for you if for any reason you are unable to make them yourself. The Living Will portion allows you to leave a written set of instructions to your physician as to whether or not you want to receive life-sustaining procedures if you have been diagnosed with a terminal condition or are in a persistent vegetative state. It gives guidelines for your family members to follow if you become terminally ill.
- Durable General Power of Attorney
A Durable General Power of Attorney, sometimes called a Financial Power of Attorney, allows you to delegate to the person of your choice the ability to manage assets that are titled in your name, including retirement plans.
- Revocable Trust
Depending on your personal situation and/or the state where you reside, you may require a revocable trust which contains a detailed set of instructions for what happens if you become mentally incapacitated and what happens after your death. This document would be combined with a type of Will called a “pour-over Will”. It helps avoid the necessity for probate in the event of your death.
In addition to these documents, it is essential that you communicate with your family if you have placed such an estate plan in force and advise them where to locate the originals of these documents in the event of your incapacity or death.
For more information contact Stacey Willits McConnell – Chair of Lamb McErlane’s Estate Planning and Trusts Department. 610.701.4431
Estate Planning for your Invisible Assets
As part of a complete estate plan you must consider your “invisible assets” which include your “digital assets.” These include those assets you access electronically such as checking accounts, retirement accounts and other financial accounts, as well as your user names, passwords and security questions to access these accounts. Digital assets also include your licenses to software, programs you have developed, e-mail accounts, photo storage sites, social networking such as Facebook, and backup storage for your home and business computers.
How do you protect this information and make it available in the event of your death or disability? You should prepare a separate document listing all pertinent information to provide your family and executor with the most expeditious means of protecting these assets and passing them on to your beneficiaries. The list should include all your on-line accounts, user names, passwords, security questions and answers. This list can then be stored with your Will and Financial Power of Attorney along with other valuable papers such as recent income tax returns. It can also be placed on your computer, your removable storage drive or in a “cloud” with remote access. Most importantly, you must communicate to your family member or advisor whom you expect to assume responsibility and where the information is stored, in the event of your death or disability.
Finally, all this information must be kept current to be useful. Each new password, account number or user name should be added to the list or placed in a new updated list and the old one destroyed. In this increasingly digital world, these online and electronic assets will play an increasingly important role in your estate plan.
Non-Tax Reasons to Have a Will and Power of Attorney
There may be plans to abolish the federal estate tax. It is good to remember that there are many reasons for having a Will and Power of Attorney other than the avoidance of taxes:
- Incapacity. This may be the single most important reason to have a power of attorney. By preparing a health care power of attorney, you designate who will make health decisions for you when you cannot. This same person will be able to make end of life decisions for you. In addition, a power of attorney can name someone who will handle your financial affairs when you cannot. Without one, your family may need to go to court to have a guardian appointed for you. That person may not be the individual you would choose and the process is expensive, time consuming and subject to public scrutiny. A power of attorney will prevent a guardianship.
- Avoiding conflict. A properly prepared Will can avoid family disputes. This is particularly important when you wish to distribute your property at death in an unequal fashion.
- Guardians. If you have children under the age of eighteen or an incapacitated child, you must prepare a Will to choose a guardian for these children.
- Managers. Your Will determines who will be in charge following your death. If you don’t write a Will, it will not be your decision as to who will direct the distribution of your property.
Remember that while taxes are an element of an estate plan, the most important reasons to have a well drafted Will and Power of Attorney are non-tax reasons. Don’t delay in getting the proper documents in place.
Stacey chairs the firm’s Estate Planning and Trusts Department and has been in private practice in the Philadelphia area for more than 20 years representing both individuals and institutions. Her practice focuses on estate planning, administration of trusts and estates, charitable giving, and sophisticated wealth preservation and transfer techniques.