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A. In a Will, you name a personal representative or
"executor" to administer your estate and distribute your assets
according to your wishes. If you die without a Will, you have no control
over who will administer your estate, and your estate will be
distributed according to state laws. In your Will you should also name
guardians to assume responsibility for your minor children’s care and
the management of their funds and assets. You should have a Will and
should review it periodically, especially when there are changes in your
family circumstances or changes in estate or tax law. |
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| Q. What are
the procedures for distributing a person's assets after death? |
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A. When a loved one dies, most Wills must be
"probated" to carry out his or her directions. If you have been named
the executor of an estate, you have important legal responsibilities
including the probate of the Will, notification of interested parties,
gathering and managing the assets of the estate, preparing an inventory
and accounting, payment of income and inheritance taxes, and
distribution of the estate assets. It is strongly advised that you
consult with an attorney promptly if you become an executor of an
estate. |
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Q. What are the rates of inheritance tax for
Pennsylvania residents? |
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A. Effective June 30, 2000, the
Pennsylvania inheritance tax on property inherited by the deceased’s
children, grandchildren, parents or grandparents was reduced from 6% to
4.5%. There continues to be no inheritance tax on property inherited by
a surviving spouse. In addition, inheritance tax has been eliminated on
property inherited by a parent from a deceased person under age 21.
Finally, the inheritance tax rate on property inherited by a sibling (a
brother or sister, or half-brother or half-sister) was reduced from 15%
to 12%. All other inheritance tax rates remain at 15%. |
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| Q. When does
inheritance tax have to be paid? |
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A. An inheritance tax return is due 9 months following
the date of death. A discount of 5% is granted on inheritance taxes paid
within 3 months of death. |
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| Q. What is a
Power of Attorney? |
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A. A Power of Attorney is a legal document
in which the Principal (the person giving a Power of Attorney) appoints
an Agent to act on his or her behalf in all or specified matters during
the Principal’s lifetime. A Durable Power of Attorney allows the Agent
to act even when a Principal becomes incompetent or unable to handle his
affairs. |
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| Q. Who must
execute a Power of Attorney? |
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A. A Principal must sign a special Notice
regarding the authority of the Agent under the Power of Attorney and the
Agent must also sign an Acknowledgement agreeing to act solely for the
benefit of the Principal. |
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