Living Trust Attorney in Pennsylvania — Probate, Inheritance Tax and When a Trust Helps

Pennsylvania probate is manageable, but Pennsylvania also has an inheritance tax that applies whether or not you have a trust. This guide from a living trust attorney in Pennsylvania perspective explains when a living trust is worth it and what it can and cannot do.

A trust avoids probate and provides privacy. However, it does not avoid Pennsylvania inheritance tax. Moreover, Pennsylvania does not allow transfer-on-death deeds. Consequently, a trust is a key tool for passing Pennsylvania real estate without probate.

Therefore, the right plan depends on your property, your beneficiaries and your goals.

How Pennsylvania probate works

In Pennsylvania, probate begins with the Register of Wills in the county where the person lived. The executor obtains letters testamentary and advertises the estate. Creditors then have a period to present claims.

Pennsylvania probate is often less expensive than in some states. However, it still involves filings, notices, an inventory and an accounting. In addition, the process typically takes about a year.

For small estates, Pennsylvania offers a simplified petition when assets fall below a set limit, which was recently raised. Our Probate Documents service helps executors.

The Pennsylvania inheritance tax

Pennsylvania taxes inheritances based on who receives them. Transfers to a surviving spouse are taxed at 0%. Transfers to children and other lineal descendants are generally taxed at 4.5%. Meanwhile, siblings pay 12% and most other beneficiaries pay 15%.

Importantly, assets in a revocable living trust are still subject to Pennsylvania inheritance tax. Consequently, a trust does not reduce this tax. However, a discount is available for paying early. Therefore, executors and trustees should plan the timing.

A living trust consultation explains how the tax affects your beneficiaries.

Why a trust helps Pennsylvania homeowners

Pennsylvania does not allow transfer-on-death deeds for real estate. As a result, a home owned in your name alone usually passes through probate.

A living trust solves this. Once the home is deeded to the trust, the successor trustee can transfer or sell it without probate. Furthermore, a trust can hold property in other states, avoiding a second probate.

Joint ownership is an alternative. However, it can expose the home to a co-owner's creditors and create gift issues. Therefore, compare the options carefully.

Funding your trust in Pennsylvania

A trust only avoids probate for assets it actually owns. Therefore, funding is the step that makes everything work.

Real estate

Pennsylvania homes are transferred to the trust by deed, recorded with the county Recorder of Deeds. Transfers into your own revocable trust are generally exempt from Pennsylvania realty transfer tax when done correctly. Therefore, use the correct deed language and forms.

Accounts, retirement and insurance

Next, retitle bank and brokerage accounts into the trust's name, or add the trust as the payable-on-death beneficiary where allowed. Retirement accounts usually stay in your name with beneficiary designations instead. Similarly, life insurance can name the trust or individuals.

Personal property

Finally, an assignment of personal property moves household items into the trust. Our Living Trust package includes step-by-step funding instructions for Pennsylvania. Consequently, nothing important is left behind.

Blended families, children and choosing a trustee in Pennsylvania

Blended families need careful planning. For example, a parent may want to support a new spouse while protecting an inheritance for children from an earlier marriage. In addition, Pennsylvania gives a surviving spouse a right of election against the will in many cases, which can affect plans for children from an earlier marriage. Therefore, a trust can hold assets for the surviving spouse for life and then pass the remainder to the children.

Similarly, a trust can manage money for minor children until they are older, instead of handing everything over at 18. Moreover, you choose the successor trustee. Pick someone organized, honest and willing, or name a professional trustee when family dynamics are complex.

If you already have a trust, a trust review checks whether it still fits your family and Pennsylvania law.

Flat fee living trust pricing and documents in Pennsylvania

Our Living Trust service starts at $199 for Pennsylvania. The standard package tailors the trust to Pennsylvania law and your family. Meanwhile, the premium package adds attorney review.

A complete plan also needs a durable power of attorney, which in Pennsylvania requires a signed acknowledgment by the agent and specific witnessing, plus a healthcare power of attorney and living will. Our Estate Plan Bundle prepares these to Pennsylvania standards. In addition, our durable power of attorney and healthcare directive services are available individually.

Not sure whether a trust is worth it for you? A living trust consultation compares a trust with a will and other probate-avoidance tools. For more, read our national guide to flat fee living trusts.

Common living trust mistakes in Pennsylvania

The most common mistake is signing a trust but never funding it. Consequently, assets left outside the trust may still need probate. In Pennsylvania, another frequent problem is assuming a trust avoids Pennsylvania inheritance tax. It does not, so beneficiaries who are siblings or friends may still owe tax.

Similarly, many people forget to update beneficiary designations on retirement accounts and life insurance. As a result, money can go to an ex-spouse or the wrong person. Therefore, review every designation when you sign your trust.

Finally, keep the trust current. Marriage, divorce, a new grandchild or a large change in assets should all prompt a review. In addition, store the original documents safely and tell your successor trustee where they are.

What the trustee does after a death in Pennsylvania

When the trust creator dies, the successor trustee takes over without court involvement. First, the trustee obtains death certificates and secures the assets. Next, the trustee notifies beneficiaries as Pennsylvania law requires.

After that, the trustee pays debts, expenses and any taxes. In particular, the trustee should file the Pennsylvania inheritance tax return and consider paying early to receive the discount. Then the trustee transfers or sells real estate by recording documents with the county Recorder of Deeds.

Finally, the trustee distributes the remaining assets under the trust's terms and keeps records. Consequently, the family avoids probate and keeps matters private. Our executor documents service helps trustees and executors stay organized.

Out-of-state property and moving to Pennsylvania

Many Pennsylvania families own property elsewhere, such as homes in the Jersey Shore, the Poconos or Florida. Without a trust, each state may require its own probate, called ancillary administration. Therefore, deed out-of-state property to your trust too.

If you move to Pennsylvania with a trust from another state, it generally remains valid. However, it may not reflect Pennsylvania's tax rules, property law or signing requirements for related documents. Consequently, a review after a move is wise. In addition, update your powers of attorney and healthcare documents to Pennsylvania forms, because banks and hospitals accept familiar forms more readily.

Our Living Trusts services in Pennsylvania

Every service below has a fixed price, is prepared by a qualified attorney and is delivered online — wherever you are in Pennsylvania. Additionally, you can upload evidence, message your attorney and track progress from your secure client dashboard.

Living Trusts across Pennsylvania — cities we serve

We work with clients in every part of Pennsylvania, entirely online. Therefore, it does not matter whether you live downtown or hours from the nearest courthouse. Your documents follow Pennsylvania law and your county's local practice. Choose your city below to see local details and prices.

• Philadelphia: Revocable Living Trust in Philadelphia · Complete Estate Plan Bundle in Philadelphia · Living trust consultation in Philadelphia
• Pittsburgh: Revocable Living Trust in Pittsburgh · Complete Estate Plan Bundle in Pittsburgh · Living trust consultation in Pittsburgh
• Allentown: Revocable Living Trust in Allentown · Complete Estate Plan Bundle in Allentown · Living trust consultation in Allentown
• Erie: Revocable Living Trust in Erie · Complete Estate Plan Bundle in Erie · Living trust consultation in Erie
• Reading: Revocable Living Trust in Reading · Complete Estate Plan Bundle in Reading · Living trust consultation in Reading
• Scranton: Revocable Living Trust in Scranton · Complete Estate Plan Bundle in Scranton · Living trust consultation in Scranton
• Bethlehem: Revocable Living Trust in Bethlehem · Complete Estate Plan Bundle in Bethlehem · Living trust consultation in Bethlehem
• Lancaster: Revocable Living Trust in Lancaster · Complete Estate Plan Bundle in Lancaster · Living trust consultation in Lancaster
• Harrisburg: Revocable Living Trust in Harrisburg · Complete Estate Plan Bundle in Harrisburg · Living trust consultation in Harrisburg

More Pennsylvania services

Complete Estate Plan Bundle in Pennsylvania · Living trust consultation in Pennsylvania · Durable Power of Attorney in Pennsylvania · Advance Healthcare Directive / Living Will in Pennsylvania · Probate Documents Package in Pennsylvania · Trust review in Pennsylvania. See all legal services in Pennsylvania.

Nearby states

Moving between states, or is the other party elsewhere? We also cover Revocable Living Trust in New Jersey, Revocable Living Trust in New York, Revocable Living Trust in Ohio, Revocable Living Trust in Maryland, Revocable Living Trust in Delaware. See every location we cover.

Frequently asked questions

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Related guides

This guide is general information, not legal advice for your situation. Every case is different — speak to a qualified attorney before you act.