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Trusts Archives

Can I Keep My Kids From Blowing Their Inheritance?

Parents go to great lengths to protect their kids, and this includes setting aside money and property to pass on to them after parents pass away. If you are like many Pennsylvania parents, you probably want to maximize the financial gifts you leave to your kids. However, you probably also want to ensure they don't waste the inheritance you worked so hard to leave behind.

The benefits of a trust

When Pennsylvania residents are interested in ensuring that they will be able to leave their assets to family members in a particular way, a trust may be recommended to them. Wills can name certain individuals to receive a person's assets, but those assets are distributed in a lump sum. Trusts give people greater options in how property is doled out.

Digital assets require valuation for estate purposes

Increasing numbers of Pennsylvania residents possess digital assets. Some of them, such as digital photographs on a smartphone, might only have sentimental value, but other forms of digital assets could be worth quite a bit of money. An estate plan should include information about how to access a digital portfolio and assign a value to the assets.

Administration of an estate

Pennsylvania residents who have been honored with the task of administering an estate may want to know more about the requirements of the process. The personal representative who is named in the will could expect to take a number of actions in order to fulfill the duties of the role in accordance with the decedent's wishes. In the event that the instrument in question is a trust, the role of administrator would fall to the trustee.

Reasons everyone should have an estate plan

If people are married with children, assets tend to go to either their spouse or children when they die in the absence of a will. However, those who are married without children may want to create an estate plan to account for where their assets go upon their death. While they may first transfer to a spouse, they may be transferred to the surviving spouse's family upon his or her death.

Options for gifting children in estate planning

Pennsylvania parents might want to gift part of their estate to their children while they are still alive. However, there are some pitfalls they should be aware of. For example, cash or stock that is only minimally appreciated is a better gift than an asset that is highly appreciated because of future capital gains tax. Highly appreciated assets are best passed on after an individual's death.

Avoiding federal estate tax with an AB trust

Married couples in Pennsylvania may be able to pass on more of their assets to their children and grandchildren if they use an AB trust. An AB trust is specifically designed for married couples who want to maximize their estate tax exemptions. With a well-planned AB trust, a married couple that would otherwise owe federal estate taxes may be able to pass a tax-free inheritance to their beneficiaries.

Understanding how a trust ends

The owner of an estate can place assets into a trust and assign a trustee to manage it for a beneficiary. The guidelines for how the assets are to be managed and taken care of will be detailed a written document referred to as the trust document. It is a convenient legal mechanism for an individual to use if he or she will not be able to manage the property in the future. However, Pennsylvania residents who are considering using a trust as part of their estate planning should be aware that a trust will eventually end.

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