View Blog Navigation

Pennsylvania Law Blog

Using a life insurance policy and a trust in estate planning

Some people in Wilkes-Barre and Philadelphia who are creating an estate plan might want to consider using a life insurance policy or a trust as part of that plan. There are a number of advantages of using the two in combination. This would involve setting up the trust as the beneficiary of the life insurance policy.

The estate tax deduction is high enough that few people need to use this combination to save on taxes, but there are other benefits. Cash from a life insurance policy can be used to fund a trust in need of money. Trusts have administration expenses, and an influx of money from a life insurance policy can help with those costs. Trusts also offer more flexibility when it comes to naming additional beneficiaries in case the main beneficiary does not live long enough to inherit. A trust allows a person to specify when and how those benefits will be distributed.

3 worst estate planning mistakes to avoid

No one likes to think about death, but a lack of proper estate planning can cause confusion and turmoil for your family once you’re gone. Too many people fail to follow through on creating a plan, while others don’t update their plans after significant changes occur.

Some people in Wilkes-Barre and Philadelphia believe estate planning is for older people and something to do later, while others may think they don’t have enough assets to worry about creating a will, trust or other option to pass along their money and property.

Estate plans can see to the needs of pets as well as heirs

Incorporating the needs of dogs or other companion animals in an estate plan would have raised eyebrows just a few years ago. However, pet provisions in wills and pet trusts are commonplace in Pennsylvania and around the country today. A pet of some kind can be found in two out of three American homes, and many of their owners take great comfort in knowing that their animals will be taken care of should something happen to them. However, including pets in a will may not be the wisest way to accomplish this as the probate process is lengthy and pets could languish in a shelter for several months as it runs its course.

Estate planners often use trusts because they allow estates to avoid the probate process. Furthermore, they provide a reliable way to make sure pets are cared for according to their owner's wishes. Adding pet provisions to an existing trust or creating a separate pet trust allows pet owners to set aside care money and designate a trusted individual to look after their companion animals.

Backing out of a contract to buy a home

In Wilkes-Barre and Philadelphia, Pennsylvania, buying or selling a home often falls through for various reasons. A buyer may later decide they no longer want to buy a home after their offer has been accepted. In this case, a complex legal matter may ensue. However, it is possible to get out of a signed real estate contract if the prospective buyer includes escape options before the signing.

A quick answer to the backing out issue is that a buyer can get out of an accepted real estate offer if the signed contract has contingencies. This legal option also enables most buyers to obtain refunds on their earnest money. However, sellers and realtors are not fond of buyers who back out of their contracts. A contract must stipulate specific reasons that make backing out a legally acceptable option.

The pros and cons of short-term mortgages

First-time homeowners in Pennsylvania are often faced with the dilemma of determining which mortgage option is best for them. The two main possibilities are short-term and long-term loans. Here's a closer look at the pros and cons of the short-term option.

Homeowners with a high-paying job and a stable source of income may benefit from a short-term mortgage. This is typically a 15-year loan with higher monthly payment. On the positive side, a short-term loan can help a new homeowner build equity on their home faster. Another perk is the ability to save money by enjoying lower interest rates. This arrangement could also be preferred if a homeowner doesn't have other significant debt obligations that may stretch their budget.

Reasons for a trust

Many people in Pennsylvania may not consider creating a trust when developing an estate plan. However, the inclusion of a trust can be very beneficial.

A trust is a legal agreement between a settlor and a trustee. For estate planning purposes, the trustee agrees to manage, safeguard and receive the assets that are provided by the settlor. The trustee also accepts the duties of administering the assets in accordance with the trust's directions and to distribute the income and principal of the trust, as dictated by the trust, for the trust's beneficiaries.

Alternative dispute resolution for real estate disputes

Sometimes, even the most straightforward real estate transactions can result in disputes that require legal action. The process of buying and selling real estate is not always strictly business. Homeowners are notoriously sentimental about their properties, and often feel that their personal investment in their homes leads to a higher property value. It's important for both parties to understand which resolution methods are most effective for their particular situation.

 

Why trusts may be better than wills for some estate plans

People in Wilkes-Barre and Philadelphia may want to consider using a trust instead of a will in their estate planning. This has been the recommendation of the AARP since 1991. There can be a number of advantages to using a trust over a will.

Many people like trusts because unlike wills, they are private documents. Assets in a trust do not have to pass through the probate process, and this might reduce the likelihood of legal challenges. Assets that have been in an irrevocable Medicaid Asset Protection Trust for at least five years are protected from nursing home costs. Trusts can also be created that protect assets in case a person gets a divorce or remarries. With an inheritance trust, assets left to children will then pass on to their children instead of to a spouse. Trusts can also be useful in blended families. A trust can ensure that a person's assets pass to children instead of a spouse, who may remarry and give those assets to a new family.

How negligence is proved in civil lawsuits

When car accident victims in Pennsylvania file lawsuits against the motorists who injured them, their litigation is usually based on allegations of negligence. To prove the civil law tort of negligence, plaintiffs must convince a jury that the defendant was required to take reasonable care and failed to meet this legal duty. They must also be able to establish that their harm was suffered as a direct consequence of the defendant's negligent actions.

Every state requires drivers to remain vigilant at all times and obey motor vehicle traffic laws, so establishing that a duty of care existed is not usually a challenge in car accident lawsuits. Proving that motorists failed to meet this duty is also fairly straightforward when the drivers who caused accidents broke the law. Personal injury attorneys generally study police reports when representing car accident victims as they may reveal that drivers were intoxicated when they crashed or committed a moving violation in the moments before a collision.

Fraud and buying homes

Pennsylvania residents who are looking to purchase a home may be interested to learn that the FBI reported that there was $150 million lost due to real estate fraud in 2018, with 11,000 people in the United States becoming victims of scams. The majority of the loss occurred because an email was infiltrated or too much data was publicly available, giving scammers the opportunity to take advantage of their victims during a stressful and expensive situation in their lives.

Attackers are able to gain valuable information from the compromised emails of real estate agents, attorneys and title agents. This information can include important details regarding an imminent home transaction. The information they can gain can be used to generate similar-looking emails that are used to engage the prospective homebuyer. With these communications, the attackers are able to get the homebuyer to use fraudulent wiring information that allows the attackers to steal down payments and closing costs.

Get Help Now

Need help from an attorney?
Don’t risk losing your rights by waiting. Contact us right now.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Vinsko & Associates, P.C.

Wilkes-Barre Office
37 North River Street
Wilkes-Barre, PA 18702

Phone: 570-550-0815
Fax: 570-970-9711
Wilkes-Barre Law Office Map

Philadelphia Office
1700 Market Street
Suite 1005
Philadelphia, PA 19103

Phone: 215-309-8275
Fax: 215-278-4764
Philadelphia Law Office Map

Review Us

Evening and weekend appointments available