Ominbus Changes to PEF Code

On July 8, Governor Wolf signed S.B. 1104 into law, making it Act 79 of 2016.

Act 79 makes numerous changes to the Probate, Estates and Fiduciaries Code, including including changes affecting how to determine title to real estate, personal jurisdiction over personal representatives, powers to continue businesses, powers of health care agents, powers of agents, releases of powers or interests, powers of appointment, the Uniform Trust Act, and charitable instruments.

Act 79 is generally effective January 1, 2017.

We are working on a more detailed explanation of the changes, which we hope to publish soon.

Juniata and Perry Counties Local Rules

Juniata and Perry Counties have repealed their Orphans’ Court rules and adopted new rules, to be effective September 1, 2016 (the date the new Pennsylvania Orphans’ Court Rules become effective).  Repeal and Adoption of Rules of Orphans’ Court Procedure, No. 201601972 (Juniata Co. 5/31/16), 46 Pa.B. 3243 (6/25/16), No. 201603524 (Perry Co. 5/31/16), 46 Pa.B. 3250 (6/25/16).

Note:  It appears that these local rules have not yet been approved by the Pa. Orphans’ Court Procedural Rules Committee, as required by new Pa.O.C. Rule 1.5(e), and will not actually go into effect until they have been reviewed and approved. [Updated 6/30/16]

Disclaimers of Litigation Proceeds Not Timely

An unliquidated personal injury action is not a “future interest” within the meaning of section 2116(c) of the Inheritance and Estate Tax Act (72 P.S. 9116(c)) and so disclaimers filed more than nine months after death were not effective for inheritance tax purposes.  In re Estate of William A. O’Connor Jr., 140 A.3d 77No. 2119 C.D. 2015 (Pa. Cmwlth. 6/8/2016) (opinion by Brobson, J.).

Delaware Co. Credit Card Payments and Fees

Effective June 1, 2016, the Delaware County Register of Wills and Clerk of the Orphans’ Court will begin accepting credit and debit card payments, but only for applications for marriage licenses and for copies of marriage licenses.  A “convenience fee” of 3% will be imposed for payment by credit or debit card.

Amendment to Register of Wills and Clerk of Orphans’ Court Division Fee Schedules (File No. 224-2016), 46 Pa.B. 2413 (5/14/16).

ACTEC Comments on Basis Reporting Regulations

The American College of Trust and Estates Counsel (ACTEC) has sent comments to the Internal Revenue Service on the proposed regulations for basis reporting by estates.

These comments should be of interest to practitioners concerned about compliance with the new basis reporting rules and the use of Form 8971.
For background on the new basis reporting rules and Form 8971, see “Consistent Basis Reporting Required,” “New Basis Reporting Form,” and “Basis Reporting Form Released.”
  The due date for Form 8971 has been postponed until June 30, 2016.  Notice 16-27  (3/23/16).

New Guardianship Form for Expert Testimony

The Orphans’ Court Procedural Rules Committee has proposed a new O.C. Rule 14.6, and a new form, relating to written depositions in guardianship proceedings.

As the committee report explains, expert testimony in guardianship proceedings is authorized by statute, 20 Pa.C.S. § 5518, but the form for this testimony has varied by county.  The proposed form would become a mandatory statewide form to be used by each and every evaluator who is providing testimony by deposition regarding the capacity of an alleged incapacitated person where incapacity is uncontested.

Comments on the new rule and form may be submitted by email to orphanscourtproceduralrules@pacourts.us, or by U.S. Mail to the address provided in the report.  Any comments should be submitted by June 20, 2016.

The report also notes that the committee “continues its efforts to develop more comprehensive statewide rules and forms for guardianship proceedings.”

Proposed Adoption of New Pa.O.C. Rule 14.6 and Form G-05, 46 Pa.B. 2306 (5/7/16).

Evidence Supports Testamentary Capacity and Lack of Undue Influence

Appeal from probate denied where testamentary capacity was supported by testimony of attorney who prepared will, subscribing witnesses, and other disinterested parties, and no confidential relationship shown to support allegation of undue influence.  Lewis Will, 6 Fid.Rep.3d 123 (O.C. Allegheny 2016) (opinion by O’Toole, A.J.), app. quashed, No. 155 WDA 2016 (Pa.Super. 10/11/2016) (non-precedential).

Divorced Wife Remained Beneficiary of Irrevocable Trust with Split-Dollar Insurance

Wife continued to be a co-trustee and beneficiary of the husband’s irrevocable trust even after the divorce of the parties where (a) the trust document made no provision for the possibility of divorce, (b) the irrevocable trust was the beneficiary of a life insurance policy owned by wife’s revocable trust, which was the owner of the cash surrender value of the policy under a split-dollar agreement, (c) the divorce agreement allowed the wife to keep the insurance policy and cash surrender value, and made no mention of the irrevocable trust, and (d) the wife continued to pay insurance premiums following the divorce.  Klein Trust, 6 Fid.Rep.3d 118 (O.C. Monroe 2016) (opinion by Williamson, J.)