The Supreme Court has amended the Financial Regulations of Title 204 of the Pennsylvania Code to increase filing fees by $2.00, from $17.00 to $19.00, for (among other things) petitions for grant of letters and first filings in petitions concerning adoptions, incapacitated persons’ estates, minors’ estates, and inter vivos trusts, effective immediately. “Amendment of Financial Regulations Pursuant to Act 20 of 2019, Pa.R.C.P. No. 1920.31(A)(2) and 23 Pa.C.S. § 5323; No. 523 Judicial Administration Doc.” (10/10/2019), 49 Pa.B. 6380 (10/26/2019).
Delays and what the court characterized as “poor judgment” by the trustee in responding to requests for information by the adoptive parents of the minor beneficiary of the trust were not a “serious breach of a fiduciary duty” warranting removal, but the court “strongly urged” the trustee to send the parents bank and broker statements regularly, and to promptly respond to future requests for information. Naomi Gulden Estate, 9 Fid.Rep. 256 (Lehigh Co. O.C. 2019).
The children of the decedent, as intestate heirs, might not have standing to challenge the probate of a will when there is an earlier will that has not been challenged and which provides no benefit to the children. William E. Fink Estate (No. 1), 9 Fid.Rep.3d 247 (Lycoming Co. O.C. 2019).
The court having raised the issue of standing sua sponte, and allowing the parties to brief the issue of standing, the court found that the children of the decedent who had been disinherited by an earlier will did not have a “substantial, direct, and immediate” interest in the probate of the current will. William E. Fink Estate (No. 2), 9 Fid.Rep.3d 253 (Lycoming Co. O.C. 2019).
[Note: In both opinions, the court cites Superior Court decisions for the proposition that standing is jurisdictional and cannot be waived. However, as I have noted before, the Supreme Court has ruled several times that standing is not jurisdictional and can be waived. See “Standing Is not Jurisdicational.” That does not mean that the trial court was wrong to raise the issue sua sponte, or that it was wrong in concluding that the contestants did not have standing.]
A setoff will be allowed to the Pennsylvania Bureau of Medical Care Availability and Reduction of Error Fund (“MCARE”) allowing it to reduce the amount of damages it owes to the estate by its share of punitive damages payable to it, because it failed to receive the payment for its share of punitive damages due to an error by the attorney for the administrator and the setoff is an appropriate way for the court to enforce its order of distribution. The attorney for the administrator should not be allowed to appeal the setoff order because she is asserting her personal interests in conflict with the interests of the administrator and has never withdrawn as attorney of record for the administrator or sought to become a party to the proceeding. Dubose, Adm. of Dubose State v. Willowcrest Nursing Home, 9 Fid.Rep.3d 232 (Philadelphia O.C. 2019).
Petitioner failed to show sufficient cause for the court to order the alleged incapacitated person to submit to an independent medical examination, or to produce drug and alcohol treatment records, when the alleged incapacitated person admitted to a history of alcoholism but testified credibly without any evidence of mental impairment. J.A.D., an Alleged Incapacitated Person, 9 Fid.Rep.3d 227 (Chester Co. O.C. 2019).
Action for personal injuries brought by an estate is untimely, and the statute of limitations will not be extended by a period within which the decedent might not have known that her automobile accident injuries were serious enough to qualify for a full tort action, when the decedent’s lawyer had attempted to bring a full tort action in her name within the limitations period which was dismissed because of her death before the action was filed. Edwin Moyer, Executor of Betty Moyer Estate v. Matthew Conroy, 9 Fid.Rep.3d 223 (Berks Co. C.P. 2019), on appeal, 283 MDA 2019 (Super. Ct.).
The Supreme Court has allowed an appeal from the decision of the Superior Court in Passarelli Family Trust, 2019 PA Super 95 (3/28/2019) (en banc), rev’g 7 Fid.Rep.3d 63 (O.C. Chester Co. 2016). The issues listed in the court’s order are:
(1) Whether the Superior Court’s reversal of the orphans’ court’s termination of an irrevocable inter vivos trust pursuant to 20 Pa.C.S. § 7736, which explicitly allows for the voidability of a trust induced by fraud, conflicts with another appellate court’s opinion?
(2) Whether the Superior Court’s reversal of the orphans’ court’s termination of an irrevocable trust pursuant to 20 Pa.C.S. § 7736, and implicit overruling of Estate of Glover, is at odds with this Court’s holding in Paul’s Estate regarding the factors by which a trust may be terminated?
(3) Whether the Superior Court’s reversal of the orphans’ court’s termination of an irrevocable inter vivos trust pursuant to 20 Pa.C.S. § 7736 presents an issue of first impression, especially where the Superior Court has held that a stricter standard should apply when a party seeks to rescind an irrevocable trust that was induced by fraud?
(4) Whether the Superior Court’s imposition of a stricter standard to terminate an irrevocable inter vivos trust on the basis of fraud in the inducement presents an issue of such substantial public importance as to require the prompt and definitive resolution by the Pennsylvania Supreme Court?
In re: Passarelli Family Trust, 235 MAL 2019 (9/11/2019), now 71 MAP 2019.
The Supreme Court has affirmed the Superior Court, ___ A.3d ___, 71 MAP 2019 (Pa. 12/22/2020).
With the release of the Chained Consumer Price Index (C-CPI-U) for August 2019, it’s possible to calculate various inflation adjustments for 2020. The following are the significant federal estate planning numbers, with the numbers for 2019 shown in parentheses:
- The base applicable exclusion amount (and generation-skipping tax exemption) will be $11,580,000 (was $11,400,000 for 2019).
- The annual gift tax exclusion will be $15,000 (unchanged).
- The annual gift tax exclusion for a non-citizen spouse will be $157,000 (was $155,000).
- The “2 percent” amount for purposes of section 6166 will be $1,570,000 (was $1,550,000).
- The limitation on the special use valuation reduction under section 2032A will be $1,180,000 (was $1,160,000).
- The top (37%) income tax bracket for estates and trusts will begin at $12,950 (was $12,750).
- The alternative minimum tax exemption for estates and trusts will be $25,400 (was $25,000), and the phaseout of the exemption will start at $84,800 (was $83,500).
The Internal Revenue Service will publish the official inflation adjustments in a Revenue Procedure in 4-8 weeks.
Update (11/6/2019): The Internal Revenue Service has published Rev. Proc. 2019-44 with the official inflation adjustments for 2020, and the official adjustments match the unofficial adjustments shown above.
As of September 1, 2019, Webcalculators (wcalcs.com), my on-line service that works in any browser and provides authoritative analyses of estate and trust, tax, and financial planning techniques and options, has moved out of testing and has been released on a subscription basis.
The new subscription price is $198 to use all 23 of the current estate and trust, tax, and financial planning calculator services of Webcalculators for one year. For those who registered to use the beta version of Webcalculators before September 1, Webcalculators services will continue to be free for three months, until December 1, 2019.
For overviews of some of the Webcalculators, click on “Resource Types” in the menu bar, and select “Overview.”
For users who have registered (or will register) for Webcalculators and do not pay the subscription price, the following calculators will be available:
- Life estate, remainder, annuity, and unitrust factors that are found in (or can be derived from) actuarial tables published by the Internal Revenue Service.
- Interest calculations for federal (and Pennsylvania) underpayments (or overpayments) of tax.
- Calculations of weighted average maturities for purposes of IRC § 1274.
More than 40 additional calculators are already under development for either paid subscribers or free registrants, and my goal is to add all of those new calculators within the next 12 months.