You Control Who Gets What
If you die without a will, the most basic component of an estate plan, you are said to die "intestate." When this occurs, the things you owned upon you death pass to others not in accordance with your wishes, but in accordance with Pennsylvania intestate law. Sometimes this is acceptable because those laws may align with your wishes, but for many this is not ideal. For example, Pennsylvania law may dictate that a share of your estate go to a family member who you are not close with.
With an estate plan, you control who gets what.
You Ease the Burden on Family
Dying without a will makes the probate process more difficult on family members because, since there is no will, you have not named an executor of your estate. That is, you have not stated a preference for who should carry out the terms of the will and administer the estate during probate (the court process by which title to property in the decedent's estate changes to the new owner). A family member must petition the local register of wills for "letters of administration," which gives them the authority to administer the estate in accordance with Pennsylvania intestate law.
With an estate plan, you ease the burden on family.
You Could Save on Taxes
There may also be tax consequences at the federal or state level. At the federal level, the estate tax exemption amount is quite high ($5.49 million in 2017), but dying without a will means that you have likely not taken advantage of methods intended to minimize the estate tax if your estate is valued above the federal exemption amount. At the state level, Pennsylvania imposes an inheritance tax which increases depending on how closely or remotely you are related to the family member that is receiving property from your estate. There is no tax on property left to a surviving spouse, but Pennsylvania intestate law requires the estate be split among the surviving spouse and surviving parents or children. Thus, the share going to surviving parents or children would be subject to the inheritance tax. With a will, you could have specified that all your property go to your surviving spouse, which would have passed inheritance tax-free.
With an estate plan, you could save on taxes.
You're Prepared for Incapacity
With a durable power of attorney, a document included in all our estate plan packages, you name an agent to act on your behalf in case you are incapacitated. This allows a trusted friend or family member to manage your financial affairs in case you aren't able to do so yourself. This is an important document because, without one, a friend or family member must petition a court for guardianship, which is a costly and time consuming process. With a power of attorney, your agent has the authority to act for you immediately and without involving the court.
In addition, with a medical power of attorney, you name an agent to act on your behalf with regard to medical decisions. Doing so minimizes uncertainty about such decisions at a time when quick decision-making may be important, and when your family may be struggling emotionally.
With an estate plan, you're prepared for incapacity.
Your Wishes Regarding Medical Treatment Are Known
With a living will, a document included in all our estate plan packages, you specify your wishes in case you are in a permanent vegetative state with no reasonable hope of recovery. Some wish life prolonging measures be administered to them, like a breathing machine, believing there is always hope of recovery. Others wish to pass as painlessly as possible when doctors and family agree that hope of recovery is lost. The point is that this is a very personal decision which many feel strongly about, and a living will allows your wishes to be known to family at a time when you cannot communicate them yourself.
With an estate plan, you make your wishes regarding medical treatment known.
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