PA Small Estate & Deposit Payment Thresholds Increased

The Pennsylvania Probate, Estates & Fiduciaries Code (Title 20 of PA Consolidated Statutes) was amended in minor, but helpful, ways by Act 35 of 2013, which became effective on August 31, 2013.

The changes in affected sections of Title 20 are noted in the adopted form of House Bill 513, Printer's No. 2169, of the 2013-2014 Legislative Session.  HB 513's History indicates it was adopted by the Legislature on June 29, 2013, and signed by the Governor on July 2, 2013.  It became effective 60 days thereafter.

Under long-standing statutory law regarding "Dispositions Independent of Letters", pursuant to 20 Pa. C.S. § 3102 ("Settlement of small estates upon petition"), a "small estate" -- defined as one with assets less than $25,000 and no real estate -- could be settled by a customized petition presented to the Orphans' Court Division, as an alternative to a formal probate procedure.

Section 3102 provides, in its first sentence, as follows:

When any person dies domiciled in the Commonwealth owning property (exclusive of real estate and of property payable under section 3101 (relating to payments to family and funeral directors), but including personal property claimed as the family exemption) of a gross value not exceeding [$$$ = AMOUNT], the orphans' court division of the county wherein the decedent was domiciled at the time of his death, upon petition of any party in interest, in its discretion, with or without appraisement, and with such notice as the court shall direct, and whether or not letters have been issued or a will probated, may direct distribution of the property (including property not paid under section 3101) to the parties entitled thereto.

The prior law had stated an AMOUNT of $25,000.  The amendment increased the AMOUNT to $50,000, but made no other changes to that Section.

Other, more frequently used dispositions of a decedent's assets of a limited value without a formal probate were provided under 20 Pa. C.S. § 3101  ("Payments to family and funeral directors").  That Section continues to provide for payments directly to certain persons or organizations regarding five different classes of assets up to certain amounts.

Act 35 amended the maximum amounts for two of the five classes of assets, as set forth in subsections (b) and (c) only.

• (a)  Wages, salary or employee benefits (remains at not more than $5,000)
• (b)  Deposit account (previously not more than $3,500, which was increased to $10,000)
• (c)  Patient's care account (previously not more than $4,000, which was increased to $10,000)
• (d)  Life insurance payable to estate (remains at not more than $11,000)
• (e)  Unclaimed property (remains at not more than $11,000)

In two further helpful tweaks to subsection (b), Act 35 clarified that a "credit union" is included as a financial institution holding a "deposit account" and authorized to make such payments directly, without proof of an estate administration.  It also amended the law to be directive, as opposed to optional, for a financial institution to make such payments upon proper application.  The word "may" was replaced with "shall".

Section 3102 (b) now provides:

Deposit account.--Any bank, savings association, savings and loan association, building and loan association, credit union or other savings organization, at any time after the death of a depositor, member or certificate holder, shall pay the amount on deposit or represented by the certificate, when the total standing to the credit of the decedent in that institution does not exceed $10,000, to the spouse, any child, the father or mother or any sister or brother (preference being given in the order named) of the deceased depositor, member or certificate holder, provided that a receipted funeral bill or an affidavit, executed by a licensed funeral director which sets forth that satisfactory arrangements for payment of funeral services have been made, is presented. Any bank, association, credit union or other savings organization making such a payment shall be released to the same extent as if payment had been made to a duly appointed personal representative of the decedent and it shall not be required to see to the application thereof. Any person to whom payment is made shall be answerable therefor to anyone prejudiced by an improper distribution.

Such amendments are helpful to many folks facing an immediate need for money for death-related expenses, or simple collection of stray or remaining assets in a decedent's name, such as a solely-held financial account, a small insurance policy, periodic final wages and benefits, or a balance remaining in a patient's care facility account.  

Likely, these changes will not affect old or stale accounts, due to periodic sweep collections by the Commonwealth since 1998 of inactive assets pursuant to the Unclaimed Property Law and Regulations.  However, subsection (e) of Section 3102 would permit recovery of such collected funds due to a decedent, if less than $11,000.

These sections do not avoid accountability or even tax reporting upon a death, but provide an expedited way for collection and application of funds without formal probate.

Joint State's Amazing Record and Report

On August 1, 2013, the Pennsylvania Joint State Government Commission posted a Report, dated August, 2013 (PDF, 4.7 MB), entitled The Probate, Estates and Fiduciaries Code and Orphans' Court Matters: Legislation Recommended by the Advisory Committee on Decedents' Estates Laws, which encapsulates -- in 291 pages of history, descriptions, summaries, lists, and tables -- the amazing impact of that organization upon probate, estate, fiduciary, and related statutes, and upon Orphans' Court matters generally, since 1945 in this Commonwealth.

The Joint State Government Commission itself was established on July 1, 1937, to serve as "the primary and central non-partisan, bicameral research and policy development agency for the General Assembly of Pennsylvania."  

Its first appointed advisory committee -- the Advisory Committee on Decedents Estates Laws. (ACDEL) -- was established in 1945.  Since then, the "Advisory Committee has generated more than 40 reports that have served as the basis for legislation introduced during numerous legislative sessions of the General Assembly", which have improved Pennsylvania law in Title 20 of the Pennsylvania Consolidated Statutes (the Probate, Estates and Fiduciaries Code -- "PEF Code") and related statutes.  

The Report provides not only a history of ACDEL, but also a compiled reference of its work products, developed by various JSGC ad hoc study groups, legislative resolution task forces, and the standing ACDEL.  Such groups have analyzed, drafted, reviewed, revised, and recommended statutory law in the Commonwealth for the past sixty-eight years.

This report first recounts the purpose of 1945 Senate Resolution No. 46, which authorized the Joint State Government Commission to form a legislative task force and advisory committee to review decedents’ estates laws.

This is the Report's Summary of its contents:

The section titled The Task Force and Advisory Committee on Decedents’ Estates Laws also discusses the membership and leadership of the Task Force and Advisory Committee and outlines the process used to develop statutory recommendations.  Finally, that section summarizes the projects of the Advisory Committee from 1945 to 1972, the codification of the PEF Code (including the original chapter organization of the PEF Code), and proposed legislation since 1972.

The next section, Advisory Committee Reports, lists all 43 published reports of the Advisory Committee since its creation.  Numerous reports published after the 1972 codification contain proposed omnibus amendments to the PEF Code and, in some instances, to other titles of the Pennsylvania Consolidated Statutes.  Other reports focus on one particular topic, such as guardianships, powers of attorney, or trusts.

The list of Advisory Committee reports is followed by Proposed Legislation Organized by Advisory Committee Report.  This section details the contents of each report and provides the specific section and subsection that is the subject of the proposed amendment or repeal or that is newly proposed.  The reports are listed in reverse chronological order.

The next section, Proposed Legislation Organized by Statutory Section, comprehensively lists each specific section and subsection to which the Advisory Committee has made a recommendation.  It then summarizes the nature of the recommendation (proposed amendment, repeal or addition) and the report containing the recommendation.  Of note is that, in a number of instances, the Advisory Committee has revisited the same provision over the years, and several reports capture the multiple or recurring recommendations.

The section that then follows is Proposed Legislation Organized by Legislative Session.  Listed here are each bill introduced that is based on the recommendations of the Advisory Committee, along with the relevant provisions included in the bill and a summary of the disposition of the bill.  If the bill was enacted, the act number and enactment date is provided.  In two instances, a bill containing the Advisory Committee’s recommendations was vetoed by the Governor, despite having passed both chambers of the General Assembly unanimously.

The next section of this report provides a detailed table of contents for the PEF Code, as it was enacted in 1972.

Finally, this report contains a list of the Advisory Committee Chairs and Advisory Committee members, with dates of service and county of practice.

The Report itself is impressive in its sweep and detail.  But the story of passion and perseverance that it implies -- if you can read between the lines (because this is not pulp fiction) -- is even more impressive.

Consider that, since 1945, only 110 volunteer experts spread over 68 years -- many devoted until only death ceased their efforts -- donated their time, expertise, experiences, intellect, skills, and visions to suggest statutory frameworks that still evolve today.  Presently, the ACDEL has 34 members appointed by the Legislature, in roles either as lawyers or judges, serving pro bono.

Their work addressed the most difficult issues in human experience and the most fundamental laws affecting everyone -- disability, incapacity, death, reproductive technology, surrogate health care management, fiduciary administrations, and end-of-life decisions.

The most recent JSGC-ACDEL comprehensive report was issued in October, 2012, regarding reform of Pennsylvania guardianship law, contained in Chapter 55 of the PEF Code. See: Guardianship Law: Proposed Amendments to the Probate, Estates and Fiduciaries Code, which presently is embodied in Senate Bill 117 of the 2012-13 Session, as reviewed in a Legislative Analysis, dated February 12, 2013.

If that is not enough to impress you, check out the companion report also posted on August 1st -- Domestic Relations Law: Legislation Recommended by the Advisory Committee on Domestic Relations Law 1993-2010 (PDF, 218 pages).

The current supervising Legislative members of JSGC are listed.  All volunteer members of the ACDEL since 1945 were named.  The current supporting staff are listed, but past staff are not.  All were devoted to their craft.

JSGC-ACDEL produces studies and makes recommendations that are non-political, independent, expert, comprehensive, and reliable, in a cost-effective process. In this time of reduced funding and personnel, this organization is beyond special -- it is amazing.

The Joint State Government Commission is a one-of-a-kind blessing to this Commonwealth that, hopefully, will continue its work long into the future.

"Older & Wiser" Presentations Planned

After laying off for the Summer (and much of the Spring) as a blogger, I am resuming, coincident with my teaching of "Elder Law & Practice" at Widener University School of Law, beginning this evening.   This is my welcome message to the students.

It is also an announcement about a pro bono project undertaken by the Dauphin County Bar Association, using the template of the Older & Wiser® Program.

This program, conceived and implemented in 2003 by the Neighborhood Legal Services Association, is intended "to deliver important information on legal issues affecting older adults, their care givers and their families."  As a national template, it is "a free program set up in a seminar style where local state legislators and volunteer attorneys give information on these matters of special importance."

The materials for each Older & Wiser® seminar have been developed by Managing Attorney Joseph M. Olimpi and private attorney volunteers.  Each Older & Wiser® seminar is presented by a pro bono attorney who provides an informative overview of a particular legal issue, followed by a question and answer period. 

Current session topics include:

•     Protection through Powers of Attorney and Living Wills

•     Dealing Effectively with a Healthcare Facility

•     Guarding Against Senior Fraud

•     Understanding Retirement Benefits

•     Learning about Last Wills and Living Trusts

•     Avoiding Missteps in Medicaid

•     Predatory Lending and the Elderly

At each presentation, handouts and brochures are available to take home. Appropriate referral information is given if attendees are in need of direct legal services. For those attending who are income eligible, there are reduced fee and free of charge services available to meet your needs.

The goal of the Older & Wiser® Program is to provide information that will assist older adults and their families in making wise decisions that protect them and the things they own. Everyone who is interested is welcome, regardless of age, and the seminars are offered free of charge.

In an announcement to its membership on August 21, 2013, describing "another pro bono opportunity for Dauphin County Bar Association members", implementation in Central Pennsylvania was described:

[W]e are working with MidPenn Legal Services to make Older & Wiser® presentations in the community (see dates below).

The Older & Wiser® Program is a way to deliver important information on legal issues affecting older adults, their care givers and their families. It is a free program set up in a seminar style where local elected officials and volunteer attorneys give information on these matters of special importance. 

Legal services and private attorney volunteers have prepared all the materials for each Older & Wiser® seminar (a Power Point presentation, handouts and brochures) for you.   Each Older & Wiser® Power Point Presentation is presented by a pro bono attorney who provides an informative overview of a particular legal issue, followed by a question and answer period.  

At each seminar, the audience receives handouts to take home. * * *

In particular, Representative Sheryl M. Delozier is hosting three presentations using the "Older & Wiser®” and we are looking for pro bono attorneys to present on:

• Thursday, September 12 from 9:00 am – 10:30 am – Protection through Powers of Attorney and Living Wills

                Bethany Vlg East Comm. Rm (766-0279)

                325 Wesley Drive

                Mechanicsburg, PA 17055

• Thursday, September 26 from 9:00 am – 10:30 am.  – Understanding Retirement Benefits

                Essex House (730-7302)

                20 North 12th Street

                Lemoyne, PA 17043

• Thursday, October 10 from 9:00 am – 10:30 am – Dealing Effectively with a Healthcare Facility

                Simpson Public Library (766-0171)

                16 North Walnut Street

                Mechanicsburg, PA 17055

• Thursday, October 31 from 9:00 am – 10:30 am – Learning about Last Wills and Living Trusts

                The Woods at Cedar Run (737-3373)

                824 Lisburn Road

                Camp Hill, PA 17011

Attorneys interested in presenting can contact  Sandy Ballard, Esq., Public Services Coordinator, Dauphin County Bar Association, 213 North Front Street, Harrisburg, PA 17101 (Ofc: 717-232-7536; Fax: 717-234-4582; Email: sandy@dcba-pa.org.

Members of the public -- Look for such programs in your area, or plan on attending those listed above.

PA Supreme Court Appoints New Elder Law Task Force

On April 18, 2013, in a posted press release entitled Supreme Court’s Elder Law Task Force Will Tackle Growing Abuses to Older Pennsylvanians, the Pennsylvania Supreme Court announced creation of a new Elder Law Task Force.  The initial meeting of the group was held on April 16 and 17, 2013, at the Pennsylvania Judicial Center, in Harrisburg, PA.

The Press Release announced that "The Supreme Court of Pennsylvania has formed an Elder Law Task Force, chaired by Justice Debra Todd, to study the growing problems involved in guardianship, abuse and neglect, and access to justice. The task force has been charged by Chief Justice of Pennsylvania Ronald D. Castille with recommending solutions that include court rules, legislation, education and best practices."

The task force is made up of 38 elder law experts, including judges, lawyers and social workers.

The task force will have three subcommittees, one devoted to appointment and qualifications of guardians and attorneys, a second on guardianship monitoring and data collection, and a third on elder abuse and powers of attorney.  The work of the group will take approximately one year.  

“As a society, we have increased concentration on child abuse, but the issue of elder abuse has not kept pace,” said Justice Todd.

“This task force is the judiciary’s attempt to study the issues under its purview and make adjustments now, before the numbers of older Pennsylvanians and the commensurate jump in abuse, occurs." * * *

"The U.S. Administration of Aging’s National Center on Elder Abuse estimates that for every one case of elder abuse reported, five more go unreported. This is shameful, and we need to do better.” * * *

The appointed members of the Task Force met in Harrisburg on Tuesday, April 16th and Wednesday, April 17th, for introductions, initiation, presentations, and  discussions, and then for organizational activities within the three subcommittees.  During a break, a group photo was taken (reposted above).  I stand in the back row, behind the pretty lady in the red dress, Prof. Katherine Pearson, of Penn State / Dickinson School of Law.

Simultaneously with the announcement, the Administrative Office of Pennsylvania Courts posted "a variety of resources" on the UJS website, including high-definition video footage of an interview with Justice Debra Todd, the convener and Chair of the Task Force  (the first time such form of media content was posted on that website), an audio clip of the interview, and a graphic, all of which can be used or distributed freely.

Great opportunities for change -- some in study and development for five years or more -- are now presented by the Legislative branch and within the Judicial system in Pennsylvania, even as programs operated by the Executive branch are refined.  These proposals and changes would affect positively the Commonwealth's senior and disabled populations: 

• The Report and Recommendations of the Joint State Government Commission (JSGC), through its Advisory Committee on Decedents' Estate Laws (ACDEL), issued October, 2012, entitled Guardianship Law: Proposed Amendments to the Probate, Estates and Fiduciaries Code, which is now in the form of Senate Bill 117 of the 2013-14 Legislative Session, according to its legislative history.  

• The Report and Recommendations of the JSGC-ACDEL, issued June, 2011, entitled Powers of Attorney and Health Care Decision Making: Proposed Amendments to the Probate, Estates and Fiduciaries Code, which is now in the form of Senate Bill 620 of the 2013-14 Legislative Session, according to its legislative history. 

• Pending, proposed new Pennsylvania Orphans' Court Rules, published for comment in the Pennsylvania Bulletin on Saturday, April 13, 2013, which were the subject of my PA EE&F Law Blog posting PA Orphans' Court Rules Proposed for Sweeping Changes (04/04/13).

• Other proposed and pending legislative measures on similar subjects, but with different approaches.

I applaud and thank the Pennsylvania Supreme Court Justices, particularly the Chief Justice and Justice Debra Todd, for this initiative.

Karoly Estates Will Forgery Case Ruling

The Morning Call (Allentown, PA) published a news report entitled Northampton County judge upholds Karoly wills (04/05/13), by Peter Hall, highlighting the most recent development in the Karoly Estates forgery of wills matter: "John Karoly Jr.'s sisters failed to prove he entered forgeries in brother's estate, judge rules."

A Northampton County judge has affirmed a decision that sisters of disgraced Lehigh Valley lawyer John Karoly Jr. failed to prove wills he submitted in his brother Peter Karoly's estate are forgeries. * * * 

In a 31-page opinion Friday, President Judge F.P. Kimberly McFadden rejected criticism of retired Bucks County President Judge Isaac Garb's decision that the wills were authentic.

Garb, appointed as special master of the case, presided over a lengthy trial in 2011 and issued his ruling last August. Karoly's sisters asked McFadden to overturn it. * * *

Garb said the sisters failed to establish "by clear, direct, precise, and convincing evidence" that the 2006 wills were "forged and therefore invalid."

Peter Karoly, a well-known medical malpractice lawyer, and his wife, dentist Lauren Angstadt, died in February 2007 when their private plane crashed on approach to a Massachusetts airport.

The Karolys' three sisters charged that John Karoly Jr. fraudulently created wills dated 2006 for the couple — a conclusion also reached by a 2008 federal grand jury that indicted him, his older son J.P. Karoly, and Dr. John Shane, who witnessed the documents. * * *

Since 2007, these will forgery cases and its progeny have twisted and turned, but now appear near resolution, based upon extensive fact findings and trial court review.

Referencing the "burden of proof" test applied to the facts presented by the contestants, the proceedings are instructive under established will contest principles.  

However, the proceedings drew my attention because the United States Department of Justice became involved after an FBI investigation and federal grand jury findings derived from will forgery allegations.  See: PA EE&F Law Blog postings Will Contest from Bethlehem, PA (04/10/07); Trusts & Estates ... and the FBI: Pt. I. (05/22/07); Trusts & Estates ... and the FBI: Pt. II (05/23/07); and Attorney in PA Indicted for Will Fraud (09/26/08).  See also postings by Professor Gerry Beyer on his Wills, Trusts & Estates Prof Blog: The FBI-Will Contest Interface (05/22/07);  Lawyer fakes brother's will (09/28/08), and Judge upholds Karoly Wills (04/07/13).

The local articles reported alleged conduct and resulting charges as news.  However, unless the recent trial court rulings are reversed on appeal to the Pennsylvania Superior Court or Supreme Court, the will contest allegations appear resolved in favor of the surviving brother, John Karoly.

This extended odyssey shows the depth, detail, and delay involved in will contests.  The present status warns us against prejudgment or sensationalism during its progress.

In my prior posting on September 26, 2008, I pondered other possible effects of these proceedings:

To date, this case involves application of federal fraud and conspiracy laws, investigation by the FBI, examination & prosecution by the U.S. Attorney's Office, with anticipated resolution in a federal court.

This case could become a template for future prosecution of other cases involving intentional fraud in the preparation of testamentary documents offered for probate or for claim.

Although these cases remain very instructive, the collective federal and county court proceedings did not become such a "template" to insert federal laws into state probate matters.  We still rely upon state laws and procedures for resolution of will contests.  In these specific will contests, resolution appears nearly complete.

PA Orphans' Court Rules Proposed for Sweeping Changes

On April 3, 2013, the Pennsylvania Unified Judicial System website posted a news article entitled Input Sought on Proposed Rewrite of 40-year-old Orphans' Court Rules, which announced: "A substantial overhaul of the current Orphans’ Court Procedural Rules, which have remained relatively intact for nearly four decades, is being proposed."

The article continued:

The Supreme Court’s Orphans’ Court Procedural Rules Committee is seeking input from attorneys, judges and the public concerning the proposal, including those comments that may address only a specific rule or series of rules.

Interested parties may submit suggestions, comments, and/or objections in writing to the committee no later than June 13, 2013 to Lisa M. Rhode, Counsel, in the following ways:

Email:
orphanscourtproceduralrules@pacourts.us

Fax:
(717) 231-9551

USPS:
Supreme Court of Pennsylvania
Orphans’ Court Procedural Rules Committee
601 Commonwealth Avenue, Suite 6200
Harrisburg, PA 17106-2635

Proposed new Pennsylvania Orphans' Court Rules (PDF, 56 pages; See also: Official forms as published in the Pennsylvania Bulletin on Saturday, April 13, 2013, in Vol. 43, No.15, beginning at Page 654) -- when revised after consideration of comments to be offered (no later than June 13, 2013) by the public, then finalized by the Committee, and thereafter submitted for adoption by the Pennsylvania Supreme Court -- will be more than five years in the making, about forty years after the last comprehensive restatement of such rules.  

Once adopted, the final version of such new rules would take effect some time thereafter to be applicable statewide to all Orphans' Court jurisdiction matters and in all Orphans' Court Division proceedings in the Courts of Common Pleas in this Commonwealth.

The Proposed New Pa.O.C. Rules 1.1 – 11.6 and Publication Notice and Explanatory Notes are posted in PDF forms on the web page devoted to the PA Supreme Court Orphans' Court Procedural Rules Committee.  See also: Official forms as published in the Pennsylvania Bulletin on Saturday, April 13, 2013, in Vol. 43, No.15, beginning at Page 654).

The Publication Notice for the proposed new rules states as follows:

The Orphans' Court Procedural Rules Committee intends to recommend that the Supreme Court of Pennsylvania vacate Orphans’ Court Rules 1.1 through 14.5 and adopt new Orphans’ Court Rules governing the practice and procedures for the areas currently covered by these rules.

The new rules are divided into sections addressing, inter alia, the filing and audit of Accounts, procedures for Orphans’ Court matters raised by citation and petition, pre-hearing and post-hearing dispositions, and rules for practice before the Registers of Wills.

In some cases, the current Orphans’ Court rule has not been modified substantially, but is merely being relocated to a new section based upon the revised structure of the proposed new rules (e.g., Rules governing Specific Types of Petitions are moved from Rule 12 to Chapter IV and Rules governing Guardianships are moved from Rule 14 to Chapter V).

The proposal also contains Explanatory Comments, which accompany certain rules to elucidate upon the addition or modification of certain provisions or to provide additional analysis of the relationship between the particular rule and another Orphans’ Court rule and/or statutory provisions in the Probate, Estates and Fiduciaries Code.

This proposal has not been submitted to the Supreme Court of Pennsylvania for review in advance of this publication. The proposal, though, has been reviewed by an advisory group of Orphans’ Court judges appointed by then-Chief Justice Ralph J. Cappy, and these judges have provided insights, comments, and suggestions incorporated into the proposal that is being published. * * * [Paragraphing added.]

The Explanatory Report notes the objectives of the revision project outlined in October, 2007, and the extent of the revision project since then:

The proposed rule review is intended to:

• Promote standardization of statewide practice and reduce variations caused by reliance on local practice.
• Provide better direction to practitioners and judges throughout the state, especially in counties without dedicated Orphans’ Court divisions.
• Clarify certain procedures involving citation practice and pleadings.
• Harmonize Orphans’ Court proceedings with general civil practice to the extent possible, given the unique subject matter within Orphans’ Court jurisdiction.

This project has continued in earnest for nearly five years. The Committee extends recognition and gratitude to prior Committee Chairs, Judge Calvin S. Drayer and Mary Jane Barrett, Esq., for their leadership and commitment to this project.

The Committee now publishes its proposal and solicits the input, comments and suggestions of practitioners and jurist throughout the Commonwealth, particularly those who practice routinely in the Orphans’ Court divisions of various counties. * * *

The Pennsylvania Supreme Court's Orphans’ Court Procedural Rules Committee reviews current rules governing statewide practice and procedure in the Orphans’ Court and recommends new rules as necessary.

The Committee's current Members are: Margaret Gallagher Thompson, Esq., Chair; Lisa Marie Coyne, Esq.; Eugene H. Gillin, Esq.; Neil E. Hendershot, Esq.; Jeffrey R. Hoffmann, Esq.; Paul Kuntz, ex officio; John F. Meck, Esq.; and Honorable Lawrence J. O'Toole.

The Committee is supported by staff members: Lisa M. Rhode, Esq., as Counsel; James F. Mannion, Esq., as Deputy Counsel; and Elizabeth J. Knott, as Administrative Assistant.

I will make a presentation upon the proposed new Orphans' Court Rules during the 2013 Annual Meeting of the Pennsylvania Bar Association, through its Real Property, Probate & Trust Law Section, on Wednesday, May 8, 2013, from 3:15 - 4:15 p.m., at the Wyndham Grand Pittsburgh Hotel Downtown.

I will speak not as an Orphans' Court Procedural Rules Committee member (for the past six years), but as a PBA-RPPT member during its Annual Retreat.  I will encourage local bar associations and the two statewide PBA sections having an interest -- the Real Property, Probate & Trust Law Section, and the Elder Law Section -- to offer comments in writing before June 13, 2013.

Other community, governmental, business, and service organizations interfacing with Orphans' Court proceedings should also review the proposed new rules and make comments towards improvement or clarification.

PBA RPPT Section Newsletter, Winter 2013

The Winter, 2013 Newsletter (Issue No. 72) of the Real Property, Probate & Trust Law Section, of the Pennsylvania Bar Association, was published on February 28, 2013, and will be mailed to members in printed form.  It will be available to the public in PDF format for a limited two-week period through a link to the PBA's website.

A recent email from the PBA to members noted the availability of this Newsletter (24 pages), among a few other section newsletters recently published:

PBA Real Property, Probate and Trust Law Section: Newsletter, Winter 2013 – Includes "Estate and Trust Tax Changes for 2013," "Inheritance Tax Return Correction Procedures Clarified," "New Law for Disposing of Abandoned Personal Property Left by the Tenant at the Leased Premises"

This is the index to the Newsletter:

Both "dirt" (Real Property Law Division) and "death" (Probate & Trust Law Division) lawyers in Pennsylvania can benefit by reading the articles in this issue.

A vibrant and committed new team of editors, drawn from both Divisions, worked on this issue.

Two key PBA staff members continue to oversee publication efforts at the PBA.  Amy Kenn, who worked on the Newsletter years ago and who recently resumed involvement following the birth of her daughter, and Michael Shatto, who remains the RPPT Section's liaison after so many years, assure smooth functioning in its production.

My good friend and fellow Section volunteer, Mark B. Hammond, Esq., of Chambersburg, PA, officially "retired" as an editor from production of the Newsletter last year.  Both the Section's leadership in the Chair's Report, and me personally here, thank Mark for his years of services on many issues of the Newsletter.  

After continuous involvement in the Newsletter since 1978, I transitioned into a new role as "Editor at Large", with intention of further contributions as I can be helpful.

After thirty-five years, the Newsletter, to me, is like my grown child, not needing me as much, but still a source of tremendous joy and pride in the fulfillment of its dual purposes:  Disseminating information and facilitating connections for lawyers who are involved in these two areas of law practice in Pennsylvania.

IRS PTIN System Online Again

The IRS Preparer Tax Identification Number (PTIN) system was restored online effective February 2, 2013.  It had been "down" after January 18, 2013, due to litigation in federal court.  See: PA EE&F Law Blog posting IRS PTIN Registration System is "Down" (01/28/13).

According to an online notice updated by the IRS on February 4, 2013, upon request of the IRS, the legal stay was narrowed to permit continued operation of the system to register paid tax preparers.

On Friday, Feb. 1, the court modified its order to clarify that the order does not affect the requirement for all paid tax return preparers to obtain a preparer tax identification number (PTIN). Consistent with this modification, the IRS has reopened the online PTIN system.

The IRS continues to have confidence in the scope of its authority to administer this program and is working with the Department of Justice to address all options, including a planned appeal.

Please continue to check this site for additional information as it becomes available.

For a concise history of the conflict over the IRS PTIN system, which remains ongoing, see: Court Upholds Injunction; IRS Revives PTIN System, by Terri Eyden, posted on Accounting Web (02/06/13).

New Postings of PA OC & R/W Forms Online

While seeking to access Pennsylvania Orphans' Court forms through this Blog's sidebar links to their source on the Internet, I discovered my links are no longer valid.  What happened?  Something changed.

On January 31, 2013, the website of the Uniform Judicial System of Pennsylvania was completely refreshed and reformatted.  Not only is there a new homepage for the PA UJS, there is also a new "portal" leading into it.

Those Orphans' Court forms were reposted to different Internet references.  Now, these forms are displayed in a more pleasant presentation, along with other content formerly on that website.

On the related new PA UJS Portal, the layout is straightforward and efficient.  The left column offers many direct links to various sections of the new website, much like a book index, thereby avoiding navigation delays.  Such links include:

• UJS Web Portal
• Attorney Registration
• County Court Calendar
• Rules of Court
• Public Calendar Schedule
• Public Web Docket Sheets
• Financial Records

The main PA UJS website is more colorful and animated.  "Welcome to the Pennsylvania Judiciary's New Website" presently is displayed upon opening its home page:

Pennsylvania’s Unified Judicial System was the second state court system—by one week—to launch a website in 1995. With nearly 60 million hits last year, Pennsylvanians have come to depend on pacourts.us for information about the judiciary, court cases and the most recent court news and statistics.

The UJS is dedicated to continuously improving the way we provide information about the courts. Our goal was to develop something that is easy to use, attractive in appearance and capable of serving our vastly diverse audience. We want to keep you up-to-date regarding events in the judiciary and news and issues, and this space will allow us to do that. 

In a Press Release entitled Redesigned courts website helps meet changing user expectations, dated January 31, 2013, the Administrative Office of Pennsylvania Courts announced the redesigned website:

Enhancements to the new website include redesigned page layouts, improved navigation and organization of various court information areas, and highlighted news of interest to the court community and general public. * * *

The changes provide Pennsylvania’s judiciary a unified website while providing each court the opportunity to feature its own news and information on separate web pages. * * *

Among the radical changes to the PA UJS website is a redesigned home page, offering recent news involving Pennsylvania's Court System.  On the right sidebar are links for the Court's welcome message, Opinions, Docket Sheets, Fee or Fine Payments, Public Records, and Forms.

In an expansive area below is a listing, with links, to components of the Court System, by function and organization, like a "mini-portal".  This lower banner appears consistently on every web page, so you can't get lost.

A link to the Orphans' Court and Register of Wills forms is prominently featured as the first category in the full list of all types of court forms provided "For the Public".

The current approved OC/RW forms, which remain unchanged so far in 2013, are then divided into categories:

• Audit and Administration (7 forms)
• Guardianship (6 forms)
• Abortion Control Act (2 forms)
• Register of Wills (10 forms)
• Model Account Forms (4 forms)
• Foreign Adoption Forms (9 forms)

My random sampling of forms indicates that most are in fillable PDF format.  This allows data entry into the form, which could be saved using PDF editing software to retain it for later revision.  PDF reader or viewer software could only print the form with data, but not save it, so that, upon closing it online, such personalized data would be lost. See: Wikipedia's List of PDF Software.

These website revisions mean greater convenience for the public and for practitioners.  

But it creates work for me.  I must go back -- once again -- and reset links in my Blog to those forms' new online references.

“This is a new year. A new beginning.

And things will change.”

― Taylor Swift
(popular singer, born December 13, 1989,
in Wyomissing, Berks County, PA) 

IRS PTIN Registration System is "Down"

The Internal Revenue Service's Tax Professionals system presently is "down" due to litigation.  [Note:  See "Update" at end of posting, below (02/06/13)]

According to the IRS Statement on Court Ruling Related to Return Preparers, updated as of January 25, 2013, a litigation stay is the reason:

As of Friday, Jan. 18, 2013, the United States District Court for the District of Columbia has enjoined the Internal Revenue Service from enforcing the regulatory requirements for registered tax return preparers. In accordance with this order, tax return preparers covered by this program are not currently required to register with the IRS, to complete competency testing or secure continuing education. The ruling does not affect the regulatory practice requirements for CPAs, attorneys, enrolled agents, enrolled retirement plan agents or enrolled actuaries.

The Internal Revenue Service, working with the Department of Justice, continues to have confidence in the scope of its authority to administer this program. On Wednesday, Jan. 23, the IRS and Justice Department asked for the injunction to be lifted. Regardless of the outcome of that request, an appeal is planned within the next 30 days.

The IRS is continuing to evaluate the scope of the court's order in determining consistent next steps. Please continue to check this site as additional information becomes available.

The federal litigation, which was filed by individual plaintiffs in 2012, regarding required payment to the IRS of annual fees charged to professional tax preparers, was referenced in a mid-summer posting by Michael Kohn on Accounting Today, entitled Appeals Court Upholds PTIN Fee (06/13/12). The Federal Appeals Court upheld such fees:

A federal appeals court has upheld a lower court ruling dismissing the complaint of a tax preparer who argued that the Treasury Department and the Internal Revenue Service did not have the right to charge an annual fee for a Preparer Tax Identification Number.

The case involved Jesse Brannen III, a tax attorney and CPA in White, Ga. Brannen sued the Treasury Department, claiming that it exceeded its statutory authority when it began charging a $64.25 fees for issuing a PTIN and an annual renewal fee of $63. * * *  

Earlier this year, an advocacy group called the Institute for Justice filed suit against the IRS on behalf of three other tax preparers challenging the IRS’s licensing requirements (see Tax Preparers Sue IRS over New Requirements). * * *

The stay dated January 18, 2013, was issued by the trial court in the same case, Loving v. Internal Revenue Service, Civil Action No. 12-385 (See also: Memorandum Opinion, both unofficial links), filed in the U.S. District Court for the District of Columbia.  That litigation had also questioned the IRS' authority to compel annual continuing education and testing of certain federal income preparers.

But the issue of PTIN fees may be revisited in another federal jurisdiction, according to a press release issued today, entitled Atlanta Attorney/CPA Files Lawsuit Challenging PTIN User Fees (01/28/13).

On January 25, 2013, Allen Buckley, an Atlanta attorney/CPA filed suit in the U.S. District Court for the Eastern District of Tennessee, challenging charging of user fees by the U.S. Treasury Department to issue and annually renew Preparer Tax Identification Numbers ("PTINs").

Beginning in 2010, after the IRS recommended the tax return preparation industry be regulated in a new manner not approved by Congress, regulations were issued to implement IRS's recommendations. One of the regulations included the requirement that a PTIN be obtained, and that fees be charged for issuance and annual renewal of the PTIN. The IRS's recommendation called for renewal every three years, but the regulations provided for annual renewal. The initial fee is $64.25 and the annual renewal fee is $63.

The suit seeks a declaratory judgment that charging of fees for initial issuance of a PTIN and annual renewal thereof is unlawful, and also asks for a permanent injunction, preventing the Treasury Department from charging issuance and renewal fees.

Allen Buckley said: "The user fee statute is the basis for charging of fees. Numerous requirements exist for the user fee statute to be used to charge fees, including requirements that the fees are paid voluntarily and a special benefit is received by the payer. Neither of these requirements has been met in this case." * * *

With the IRS PTIN system "down", if a professional tax preparer is not currently registered or renewed, can one register anew or re-register with the IRS willingly for the year 2013?  How?

Recently, federal estate tax forms and federal transfer tax laws have been in flux.  Now federal tax professional preparer requirements for 2013 are too. 

Update: 02/06/13:

The IRS Preparer Tax Identification Number (PTIN) system was restored online effective February 2, 2013. It had been "down" after January 18, 2013, due to litigation in federal court. For an update, see: PA EE&F Law Blog posting IRS PTIN System Online Again (02/06/13).