What Happens If Your Deceased Spouse Left You Out of the Will in Pennsylvania?

August 19, 2025 by Leave a Comment

In Pennsylvania, the elective share, also known as “force share,” protects a surviving spouse from being completely disinherited as long as the surviving spouse is still married and a divorce action is not pending. The elective share allows a disinherited spouse to choose between taking thirty percent of the deceased’s probate estate on the one hand and the non-probate estate, or the assets left for them in the will on the other.  So, a disinherited spouse has the option to choose the share that’s more advantageous to her.

Signing Last Will and Testament

Not all assets are eligible for inclusion in the elective share. The following assets are eligible to be included in the elective share:

1. Probate Property: Property passing from the decedent by will or intestacy

2. Income: Property the deceased spouse would receive income from if transferred during marriage.

3. Jointly Owned Property with Survivorship Rights: If the deceased spouse jointly owned property with someone other than the surviving spouse, the deceased’s interest in that property can be included in the elective share to the extent the deceased spouse could have withdrawn or revoked the entire account balance.

4. Annuity Benefits: Survivorship rights in annuity contracts purchased by the decedent spouse during the marriage, if the decedent spouse is receiving payments from it at the time of death.

5. Lifetime Transfers of certain property: Property transferred during the decedent’s life if the decedent could revoke the transfer or withdraw it for the decedent’s personal benefit.

6. Gifts: Gifts over $3,000 made by decedent within one year of death.

The surviving spouse must file a writing with the Clerk of the Orphans’ Court that they intend to claim the elective share within six months of the decedent’s date of death or within six months of the date that the will was probated, whichever is later. The surviving spouse must file Pennsylvania Inheritance Tax Return REV-1500 with documents that show they successfully claimed the elective share. The inheritance tax rate for property acquired through the elective share is 0%, since spouses pay no inheritance tax.

If your deceased spouse disinherited you and no divorce action was pending before the spouse’s death, contact Shintia Z. Riva, Esquire at 610-521-0604 to claim the elective share.

Filed Under: Estate Planning, Wills

Understanding the Philadelphia Administrative Accelerated Rehabilitative Disposition (ARD) Program

May 25, 2025 by Leave a Comment

Philadelphia Administrative Accelerated Rehabilitative Disposition (ARD) is a pre-trial diversion program offered by the District Attorney’s Office (DA) to people with limited or no prior criminal conviction history. ARD generally lasts six (6) to twenty-four (24) months. The admission to ARD by the DA is discretionary, and a judge must formally admit a participant. Participants need to complete both mandatory and discretionary conditions to be accepted into the ARD Program.

Man in handcuffs

The following criminal charges are eligible for ARD:

  1. Misdemeanor-level drug crimes – This includes drug possession of certain lower-classified drugs without the intent to distribute them.
  1. Check fraud – Creating, using, and/or distributing falsified checks to acquire, borrow, or replicate funds.
  2. Credit card fraud – The unauthorized taking, replicating, and/or use of someone else’s credit card information or account to make purchases.
  3. Forgery – Copying someone’s signature is illegal, but it depends on the circumstances and for what documents someone’s signature was forged. A forgery charge’s ARD status goes on a case-by-case basis.
  4. Petty theft – Taking someone’s property without permission, breaking into their home, or injuring them. Robbery involves stealing by force and would not count as petty theft, and is not eligible for the ARD program.
  5. Shoplifting – Stealing from a store while pretending to be a customer. This is similar to petty theft in that nothing was stolen by force or by breaking into someone’s establishment.
  6. Embezzlement – Stealing, hiding, or misappropriating someone else’s or an entity’s funds. The effect this has on other people, how much was embezzlement, where the funds went, and what they were for all affect someone’s eligibility for the ARD program.
  7. Driving-under-the-influence (DUI/DWI) – If you drive under the influence, and it leads to no one being harmed other than yourself and your own property, you are eligible for the ARD program. If you damage someone else’s property, but no one’s physical person, you might still be eligible.
  8. Vandalism/intentional property damage – This is intentional damage like graffiti, keying someone’s car, egging someone’s property, slashing someone’s tires, and/or defacing public benches.
  9. Insurance Fraud – If you file a false claim with your auto or homeowners insurance.  

The conditions to enter the ARD includes:

  1. Waiver of the appropriate statute of limitations, such as the right to a speedy trial under Rule 600; and  
  2. Completion of a Crime Reporting Network (CRN) evaluation; and
  3. Completion of rehabilitative programs such as anger management and community service; and
  4. If you are charged with DUI must also complete an Alcohol Highway Safe Driving Course and DUI Drug & Alcohol Evaluation; and
  5. Begin a six to twelve month period of supervision by the Adult Probation and Parole Office (“APPD”) after entering the program. Keep in mind if you are on a payment plan your period of supervision will not end until you have all paid all your fines and costs.

Applicants and their counsels must also attend a preliminary hearing which will be waived as well as a pre-trial conference, and the final court date to officially enter the program. At the third and final court date is when all the fines and costs are due which are between 1,650 and $2,000.  You can get a six month installment agreement if necessary.

Keep in mind if an ARD participant is arrested and/or convicted of a new criminal offense or fails to satisfy all ARD conditions imposed between the arraignment date and final court date, they will be thrown off the program. Then all the charges could be listed for trial. However, participants successfully completing the ARD program can have their charges expunged from their criminal history after one year of completing the program.

If you are charged with one of the ten listed non-violent criminal offenses, call Shintia Z. Riva at 610-521-0604 to get into the ARD program.

Filed Under: Criminal Law

Tax Consequences of Dividing Marital Assets in a Pennsylvania Divorce

May 22, 2025 by Leave a Comment

DIVORCE LAWYER FOLSOM | TAX MARITAL ASSETS

The tax consequences of dividing marital property in a divorce can be complicated.   Internal Revenue Code (IRC) Section 1041 provides that no gain or loss is recognized on the transfer of property between spouses. Transfers that qualify under Section 1041 do not have to recognize gain or loss for income tax purposes, and the transferee spouse receives carryover basis like a gift. Section 1041’s nonrecognition rule applies to transfers between married partners who are not contemplating divorce and, in addition, extends to transfers that are incident to divorce. “Incident to divorce” is defined in Section 1041(c) as a transfer that occurs within one year after the date on which the marriage ceases or that is related to the cessation of the marriage. Temp. Regs. Section 1.1041-1T further defines the term “related to cessation of the marriage” to be a transfer pursuant to a divorce or separation instrument, if the transfer occurs within six years after the date on which the marriage ceases. However keep in mind Section 1041’s nonrecognition rule does not apply to transfers made to nonresident alien spouses or to transfers in trust where liability exceeds basis.

Documents about qualified domestic relations order QDRO.

Considering Section 1041’s nonrecognition rule as well as the unlimited marital deduction for federal estate and gift tax purposes allowed under Section 2523 for gifts of cash and property to a spouse, most property transfers in divorce will likely be nontaxable transfers.

With the presumption that any transfer within six years from the date of divorce, assuming it is under a divorce or separation agreement is treated as nontaxable under Section 1041.  In IRS Letter Ruling 8833018, this became evident when the husband was awarded a right of first refusal to acquire the family home that was awarded to the wife. This right of first refusal was exercised within the six-year time frame, and the husband “purchased” the home from his former spouse. The IRS indicated that it was not a purchase and sale but a nontaxable transfer under Section 1041. This resulted in the wife’s receiving nontaxable cash from the “sale” of the home and the husband’s receiving the home with the wife’s cost basis which was lower the purchase price, likely not the result he was hoping for.

Being able to qualify for nonrecognition of income under Section 1041 at the time of a divorce makes the division of assets much easier but leads to certain longer-term tax consequences. Since the assets have carryover basis, the potential tax liability has only been deferred. Looking at the potential tax liability of all the assets that are being divided from the marital estate can help to make the asset division more equitable as well as eliminate potential surprises for the parties later.

Since any asset received will have carryover basis, it is important to obtain the basis information as soon as possible. Temp. Regs. Section 1.1041-1T indicates that the transferor of property under Section 1041 must provide the transferee with sufficient records to determine the cost basis, holding period, and other tax information relating to the property at the time of the transfer. An adviser should recommend that a transferee spouse try to obtain this before the divorce is finalized or require it be provided in the future in the final settlement agreement to ensure compliance. 

By having the cost basis prior to the final dissolution, your tax advisers will be able to estimate any potential tax liability of the asset clients are receiving as well as have the information for reporting any future sale.

The principal residence is a typical asset that is discussed and awarded during a divorce. IRC Section 121 allows joint filers to exclude up to $500,000 of gain on the sale of a residence, and individual filers can exclude up to $250,000 of gain. This can provide a tax planning opportunity for some divorcing couples. For joint filers to qualify for the exclusion, one party needs to have owned the residence, and both parties need to have used the residence as their principal residence for a total of any two out of the last five consecutive years.

Section 121 provides very favorable treatment for parties in divorce to assist them in meeting the ownership and use tests. First, to help meet the ownership test, Section 121(d)(3)(A) allows the residence transfer from one spouse to the other spouse to include the holding period. This would allow the receiving spouse to count any ownership time of the transferor spouse as the receiving spouse’s own. Section 121(d) (3)(B) helps the parties meet the use test by allowing an individual to be treated as using property during any period of ownership while their spouse or former spouse is granted use of the property under a divorce or separation instrument. So, if one party is given temporary use of the home in a divorce instrument, the other party can count that use time as their own. Note that voluntarily moving out will not count, as it needs to be part of the agreement.

Retirement plans come in many forms and are also a common asset to be divided in a divorce. “Qualified” plans include pension and profit-sharing plans, such as defined benefit plans, Section 401(k) plans, and Section 403(b) plans. These employer-provided plans are governed by the Employee Retirement Income Security Act of 1974 (ERISA), which provides that these types of plans cannot be assigned from one spouse to the other without a qualified domestic relations order (QDRO). The requirements of a QDRO are listed in Section 414(p), and failure to follow them can have adverse tax consequences. Once the divorce court produces the order to assign some or all of the retirement account to the spouse (alternate payee), and the qualified plan administrator has determined it meets the conditions of Section 414(p) and signs the document, you have a QDRO. The retirement account will now be divided between the parties as provided in the QDRO.

An individual retirement account (IRA) is not covered under ERISA and does not need a QDRO to divide. This is also true for Roth IRAs, rollover IRAs, and nonqualified retirement and deferred compensation plans, as well as a few others. These accounts can be divided by including the instruction in the settlement agreement. These instructions constitute a domestic relations order, not a “qualified” domestic relations order in the same way that property divisions, alimony, and other instructions are recorded in an agreement.

One planning note is that a retirement account being divided via a QDRO has an opportunity to distribute funds out of the plan without having to pay the 10% early-distribution penalty. The 10% penalty normally applies if the spouse receiving the retirement distribution is under 59½ years old. Therefore, the QDRO distribution will be taxable as ordinary income but without the 10% penalty regardless of the spouse’s age. This can be a good way to generate some liquidity in a divorce with limited other assets. This distribution must be part of the QDRO instructions and is not available for IRAs, as they are not divided with a QDRO.

If you have any questions call Shintia Z. Riva, Esquire at 610-521-0604. Shintia specializes in family law at the Law Offices of Spadea & Associates, LLC.   

Filed Under: Divorce, Marital Property Division

Three Remedies to Remove Criminal Records in Pennsylvania

May 19, 2025 by Leave a Comment

In Pennsylvania, there are three main remedies for individuals with criminal records:

1) Expungement: Expungement is the process of clearing criminal records as if you were never charged with a crime, as long as you satisfy the requirement under Pennsylvania law.

Expunge of criminal record. Expungement written on a document.

A. For more information on expungement, please refer to our blog How Do I Get My Criminal Records Expunged in Pennsylvania?

2) Clean Slate Limited Access (“CSLA”): Clean Slate Law seals records after a specific period of time, but it does not expunge them. Law enforcement and judicial officers can still access the records, but you would not be required by federal law to disclose sealed records to potential employers or anyone else.

A. Arrest: arrests without conviction always get automatically sealed under CSLA.

B. Second- and third-degree misdemeanors, and misdemeanors punishable by two years or less in prison, Summary convictions are eligible for CSLA.

C. The following offenses and convictions are not eligible for CSLA:

a. Crimes involving danger to people, against families, Firearm offenses, indecent exposure, sexual intercourse with animals, failure to register upon conviction of certain sexual offenses, weapons or implements for escape, abuse of a corpse, and unlawful paramilitary training.

b. Felonies, two or more offenses punishable by more than two years in prison, four or more offenses punishable by one or more years in prison.

3) Limited Access (“LA”): This is a court order that prohibits disclosing your criminal records in most cases as long as you pay both restitution and any previously authorized fee. LA is discretionary for the court, and the court typically uses a balancing test to grant it. Similar to CSLA, law enforcement and judicial officers can still access the records because it does not expunge them.

A. Arrest without conviction never gets Limited Access.

B. Ungraded Felonies punishable by less than 5 years.

C. Most first-degree Misdemeanor convictions can get Limited Access as long as they do not involve violence, sex, or guns. Limited Access is the most typical relief for first-degree Misdemeanors.

If you want to expunge, seal, or limit access to your criminal records, contact Shintia Z. Riva, Esq. at 610-521-0604.

Filed Under: Expungements, Uncategorized

Purchasing or Selling A Philadelphia Taxicab Medallion

January 13, 2025 by Leave a Comment

The Philadelphia Parking Authority (PPA) requires taxicabs to have a valid certificate and medallion to operate in Philadelphia.  A vehicle must have a valid certificate issued by the PPA and the medallion assigned to that certificate to operate as a taxicab in Philadelphia.

Therefore, if you want to operate a taxicab in Philadelphia but do not own a medallion, you must purchase one to assign it to the vehicle you want to operate as a taxicab.  Purchasing a medallion is called medallion transfer, where the seller transfers his medallion right to the buyer. The PPA requires both the buyer and seller to be represented by an attorney. One attorney can represent both with the consent of both parties.

The medallion transfer is a two-step process. The first step is sign-in, and the second step is closing. During the sign-in, your attorney will prepare the SA-1 (medallion transfer application), agreement of sale, buyer and seller’s meeting minutes, and other related documents which need to be signed by both parties in front of a PPA officer at the PPA.  As a buyer, you need to pay a flat fee of two thousand dollars ($2,000) to the PPA for each transaction. You can purchase multiple medallions in one transaction for a two-thousand-dollar ($2,000) flat fee if you purchase all the medallions from the same seller. The two-thousand-dollar ($2,000) does not include attorney fees.

After the sign-in, the PPA officer will review and submit the application to the PPA board for approval. The board can take up to a month and a half to approve the application. Once approved, your attorney will be notified by email and proceed with the second step, closing.

The closing for the medallion transfer requires the buyer to pay the seller the full purchase price by check at the PPA and sign the settlement sheet.  A PPA officer will make a copy of the check and transfer the medallion to the buyer.

If you need help purchasing or selling a taxicab medallion, call Shintia Z. Riva at the Law Offices of Spadea & Associates, LLC at 610-521-0604.

Filed Under: Corporate Governance

How a Pennsylvania Family Court Determines Custody

December 29, 2024 by Leave a Comment

How a Pennsylvania Family Court Determines Custody

No issue is more important when parents separate than the custody and future of their children. Answering this question is also one of the most difficult and unwelcome decisions that a judge must make. The process is complex, the results uncertain, and often expensive. Multiple people, who are strangers to you, your spouse, and your children, can be involved, people such as court-appointed custody masters, psychiatrists, psychologists, social workers, and ultimately judges. All of them are looking out for the “best interests of the child.” None of them really know what that means.

To guide them all, Pennsylvania law requires that they answer a staggering sixteen invasive and uncomfortable questions to help the Court determine the following:

  • Which parent is more likely to help foster contact and the relationship between the child and the other parent;
  • Which parent is more likely to have a loving and stable relationship with the child; and
  • Which party is more likely to take care of the child’s daily physical, emotional, and educational needs.
  • Which parent takes care of the child’s basic needs;
  • The availability of extended family;
  • The accessibility of child-care; and
  • The distance between the parents’ homes.

The Courts will even assess your own mental, emotional, and physical health.  If your child is old enough and mature enough, the Courts will take your child’s preferences into account. However, your child’s preferences are not supposed to be the controlling factor.

Custody masters and judges typically use these factors like a score card, ticking off boxes in favor of one parent or another. Then, they add up the score and make their decision. They do not simply give each factor the same weight and declare a winner, however. Moreover, the Courts may not make custody decisions based on gender.  They do, as a practical matter, though, still prefer mothers of young children over fathers. It is hard for father’s to overcome this preferential treatment of mothers. Some factors are more important than others. Some facts lean more heavily in favor of one parent or the other. Even with the factors, fundamentally no judge or custody master looks at the same facts in the same way. That is what makes it so difficult for parents and their attorneys to predict how a judge will decide a custody request.

Even if different judges may assess the factors the same way, at the end of the process they still must decide how to actually divide the custodial time. That decision will determine who gets weekdays, who gets weekends, who gets holidays and vacations, which school will they attend, and even possibly who drops the children off and picks them up. While there are some basic schedules used, different judges will establish different schedules.

For parents, who must leave their children’s home on short notice and do not have a second home for themselves and their children, securing custody of their children can be very hard financially. Courts will limit the out-of-home parent’s time, including overnights with their children, if that parent does not have enough bedrooms and beds for their children. But, setting up a second home on short notice is expensive and time-consuming, especially when, as is so often the case, displaced parents generally do not have much money for their own housing after paying child or spousal support.

The amount of your custody time will also affect the amount of child support payments. To make matters more challenging, keeping up a good relationship with your child is particularly important just after separating for securing a good, long-term future with your child. So, displaced parents should try to make a suitable home for themselves and their children as soon as possible.

All of these considerations make the fight to protect your time and relationship with your children the most difficult and important aspect family separation.

If you need help establishing your right to custodial time with your children or have questions about child custody law in Pennsylvania, please contact Shintia Riva At the Law Offices of Spadea & Associates, LLC for free 20-minute consultation.

Filed Under: Divorce, Family Law

What Assets are Not Subject to Pennsylvania Inheritance Tax?

December 26, 2024 by Leave a Comment

Pennsylvania inheritance tax is due within 9 months of a person’s date of death on the value of any assets owned by the decedent and passed on to his or her beneficiaries. Here are 23 assets that are not subject to Pennsylvania inheritance tax.  

life insurance policy
  • Life Insurance. Life insurance is exempt from Pennsylvania inheritance tax, whether it is paid directly to a designated beneficiary or to the decedent’s estate. You may hear that if the life insurance is payable to the estate, then it is subject to Pennsylvania inheritance tax, but this is not accurate. Although it is often a good idea to not name the estate as beneficiary of life insurance for other reasons, such as protection of the life insurance proceeds from creditor claims, all proceeds from life insurance on the decedent’s life are exempt from inheritance tax. Note that refunds of unearned life insurance premiums for the current policy period and post-death dividends are also treated as exempt life insurance proceeds.   
  • Property Owned Jointly between Spouses. Assets owned jointly between spouses, such as joint bank accounts and real estate owned jointly with right of survivorship, are not subject to Pennsylvania inheritance tax. Additionally, there is no need to even report property owned jointly between spouses on the Pennsylvania inheritance tax return. Jointly owned assets are normally reportable for non-spouses on Schedule F of the tax return, but the Pennsylvania Department of Revenue’s instructions to Schedule F make clear that jointly owned assets need not be reported in the case of a married couple. If all property of the decedent was owned jointly between spouses, there is no duty to even file a Pennsylvania inheritance tax return.
  • Real Estate Owned as Tenants by the Entireties. Married couples in Pennsylvania often own real estate as “tenants by the entireties.” It is not uncommon to see married couples own their primary residence in this manner for estate planning reasons and for the protection from creditors titling real estate in this way can provide. It is a form of ownership where each member of the couple is deemed to own 100% of the real estate and is exempt from Pennsylvania inheritance tax.
  • Inheritance from Predeceased Spouse. Assets passing to a surviving spouse that are not jointly owned must be reported on the PA inheritance tax return. They are technically taxable, but are taxed at a zero rate, so no tax is due. Even though no tax is due, an inheritance tax return should be filed reporting the assets passing to the surviving spouse, “taxed” at zero percent.
  • Assets Passing from Deceased Child to Parent. If a child aged 21 or under predeceases a parent, no inheritance tax is due on assets passing to the parent from the child. This exception applies to assets passing to a natural parent, adoptive parent, or stepparent. Though taxable, the tax rate is zero percent.
  • Assets Passing from Parent to Child 21 or Younger. Like the exception above, if a parent dies and leaves assets to a child who is 21 or younger, the tax rate is zero. This exception came into effect on January 1, 2020. The term parent includes a natural parent, adoptive parent, and stepparent.
  • Property Passing from Certain Deceased Members of the Military. Effective September 6, 2022, assets passing from members of the military who died because of an injury or illness received while on active duty in the armed forces, reserve component, or the National Guard, are exempt from Pennsylvania inheritance tax.
  • Certain Farmland Property. Since June 30, 2012, certain farmland and agricultural property has been exempt from Pennsylvania inheritance tax if it passes to qualifying family members. Special rules exist, so if this exemption might apply in your case, review Pennsylvania Department of Revenue Inheritance Tax Information Notice 2021-01 for details and meet with an estate attorney to be sure the inheritance tax return is prepared properly, and that the criteria for the exemption are met.
  • Charitable Gifts. Assets given to charitable organizations are exempt from Pennsylvania inheritance tax. The gift to the charity must be set forth in the will, trust, or beneficiary designation to qualify for the charitable exemption. Assets “donated” by an executor to a charity or by the estate beneficiaries in memory of the decedent do not qualify for this exemption.
  • Assets Passing to the Government. If there is no will or beneficiaries who would  inherit under Pennsylvania law in the absence of a will, then it is possible for estate assets to be distributable to the Commonwealth of Pennsylvania as a “Statutory Heir” and would be exempt from Pennsylvania inheritance tax. Although rare, gifts to the United States of America, the Commonwealth of Pennsylvania, and political subdivisions of the Commonwealth of Pennsylvania are exempt.
  • Tangible Personal Property of No Value. Many items of tangible personal property are special, and valuable to the family, or may be of utility to someone, but are of no financial value. A best practice is for the personal representative of the estate (executor or administrator) to have a licensed appraiser walk through the house, taking pictures, and provide an appraisal of the tangible personal property. In many cases much of the property will be of no monetary value, and no tax will be due. Even if the property is appraised at no value, it should be reported on Schedule E of the Pennsylvania inheritance tax return setting forth $0.00 as the value.
  • Property in Another State. Tangible personal property and unsold real estate located outside of Pennsylvania titled to the individual name of the decedent is not subject to Pennsylvania inheritance tax. However, if out-of-state real estate was under an agreement of sale prior to date of death, then the proceeds received after death may be subject to inheritance tax.
  • Junk Car. Junk or worthless cars should be appraised and set forth on the inheritance tax return even if of no value. If of no value, there would be no tax due.
  • Most Lifetime Transfers. Gifts and transfers made more than one year before death are exempt from Pennsylvania inheritance tax.
  • Lifetime Gifts up to $3,000 Annually, Per Person. Lifetime gifts made within one year of death are subject to Pennsylvania inheritance tax, but there is an exemption you can claim of up to $3,000 per person per calendar year for those transfers that occurred within one year of death.
  • Advancements. Sometimes parents give a child money during their lifetime, specifying that it is an “advance” towards their future inheritance. For example, if one child of four is facing financial hardship such as going through a divorce or period of unemployment, the parent may help the child but want the estate to be adjusted in the future, so all children are treated equally. An “advancement” is not a gift and serves to the share distributed to the beneficiary from the estate. Unless the advancement occurred within one year of death, it is not subject to Pennsylvania inheritance tax.
  • Death Benefits from Social Security. Lump sum death benefits from the Social Security Administration, whether paid to the decedent’s estate or to a family member of the decedent are exempt.
  • A qualified family-owned business interest. Certain family business interests are exempt from Pennsylvania inheritance tax. The business must continue to be owned by the same family, or by a trust whose sole beneficiaries are the same family, for at least seven years after the decedent’s passing, and is reported on a timely-filed inheritance tax return.
  • Worthless Debts, Including those of Estate Beneficiaries. Obligations owed to the decedent which are worthless immediately before the decedent’s passing are exempt from inheritance tax even though collectible from the debtor’s distributive share of the estate. See 72 P.S. 9111(o) for the statutory authority permitting this exemption.
  • Pennsylvania State Employee’s Retirement System. Payments from a deceased Pennsylvania state employee from the Pennsylvania State Employees’ Retirement System are exempt from state and local tax, notably to include Pennsylvania inheritance tax with limited exceptions.
  • Individual Retirement Accounts and 401K of Decedent Under Age 59 ½. IRAs and 401K retirement accounts of a non-disabled person who died before attaining age 59 ½ are not subject to Pennsylvania inheritance tax. If the person died before attaining age 59 ½ but was disabled, then the IRA and 401K are subject to Pennsylvania inheritance tax. A Roth IRA is subject to inheritance tax regardless of the age when the owner dies, and regardless of whether the owner was disabled. A special rule applies for the owner of a 401K who dies before attaining age 59 ½, in that if the owner of the 401K possessed the legal right to terminate the 401K plan during his or her lifetime, then it would be subject to Pennsylvania inheritance tax regardless of age, and regardless of disability status.
  • Family Exemption. Certain individuals residing with a person at the time of death “as a member of the same household” are entitled to claim what is known as a “family exemption.” At the time of this writing the family exemption is $3,500 and is not subject to inheritance tax. The family exemption can be claimed by a surviving spouse, child, or parent, in that order. The family exemption cannot be claimed against joint or non-probate property.
  • 529 Education Investment Plans. The College and Career and Savings Program Account, administered by the Pennsylvania Department of Treasury, is exempt from Pennsylvania inheritance tax, and is the only 529 Education Investment Plan that is exempt from PA inheritance tax.

If you have any questions about Pennsylvania Probate or preparing a Pennsylvania REV-1500 Inheritance Tax Return call Gregory J. Spadea at the Law Offices of Spadea & Associates, LLC, at 610-521-0604. 

Filed Under: Estate Planning, Federal Tax, Tax Exemptions

Financial Infidelity Can Destroy a Marriage

December 23, 2024 by Leave a Comment

HOW FINANCIAL INFIDELITY CAN DESTROY YOUR MARRIAGE AND HOW TO PROTECT YOURSELF

Financial infidelity has destroyed many marriages. It can come in many forms. Sometimes, your spouse may be too embarrassed to tell you about a job loss, a failing business, or an unexpected disability. Perhaps, your spouse ran up credit cards without your knowledge for personal luxuries, like clothes and jewelry, or to support an adulterous relationship.

Past due bill

It could be drug or gambling debts. Worse yet, maybe, he or she stole your identity to open credit card accounts under your name. Even more shocking, your spouse may be hiding a mortgage foreclosure or even a pending sheriff’s sale. If you suspect that your spouse has committed financial infidelity, you need to know your rights and your obligations to the creditor and your spouse for personal and joint, marital debt. They depend first depend on whether they are your debts, your spouse’s debts, or your marital debts. They will also depend on whether you are divorcing or being pursued by creditors.

Your Obligation for Individual Debts

When it comes to creditors, only you and not your spouse are legally responsible for your own individual debts, such as your credit cards. You are not responsible for your spouse’s individual debts. You and your spouse are, however, legally obligated to pay your joint debts, such as a mortgage on your home. So, joint creditors can attack your individually owned property, including bank accounts, to pay for joint debts.

Pennsylvania law distinguishes between individual debt and joint marital debt because, your marriage is a separate legal entity that stands apart from you as an individual. In other words, a marriage results in three distinct separate legal units: you, your spouse, and your marriage. Pennsylvania law makes this distinction specifically to protect you and your family from the ravages of your partner’s financial infidelity!

Legally therefore, your joint assets are protected from your spouse’s creditors.  They cannot force a sale of any asset that you own together as spouses. Of course, joint creditors can go after your joint assets, like your home. While these obligations to creditors remain valid when financial infidelity leads to divorce, a divorce can change who is responsible for those debts between you and your spouse.

Your Obligation for Marital Debts

In divorce, your financial obligations fundamentally depend on whether the debts were incurred before your marriage, during marriage, or after separation and divorce.

Pennsylvania’s divorce laws do not hold you responsible for debts that your spouse had before you married or that he or she incurred after you separated and later divorced. Likewise, your spouse is not responsible for your pre-marital debts, your post-separation, or post-divorce debts. In contrast, a divorce may make you responsible for debts that your spouse signed for individually during the marriage and before your separation. Your total debt at the end of a divorce, regardless of whether the debt is yours, your spouse’s, or joint, ultimately depends upon the Court’s decree for equitable distribution or on how you and your spouse divide them in a property settlement agreement.

As noted in our blog, “What is a Marital Asset?,” there are many factors, both well-established and novel, that will determine how responsibility for your marital debts will be divided. Financial infidelity, innocent or not, will be a major factor in shifting the responsibility for debts in your name back to your spouse. There are other reasons for shifting responsibility, though. One example is a student loan that was used for documented household expenses and not for tuition payments. When this occurs, the other spouse may have to pay the debtor spouse or the lender directly even though the debtor spouse will remain primarily responsible to the lender for paying it back.

Protecting Yourself When You Suspect Financial Infidelity

When you suspect financial infidelity, you need to act quickly to protect yourself from your spouse’s debts.  Here are some steps you should take to protect yourself.

  • Stop your spouse from using your credit cards by ending your spouse’s authorized use of them. Simply call the credit card company and tell them that your spouse is no longer authorized to use your credit and, most importantly, have them issue you a new card with a new account number. This easy move will prevent your spouse from using your on-line accounts, like Amazon, too.  Do not share this new card with your spouse.
  • Open a separate bank account if you do not have one already. Then, have your employer deposit your wages or salary directly into that account. Now you, not your spouse, will control what you do with your money.
  • Review statements for your bank, mortgage, loans, and credit card accounts. Challenge suspicious transactions by reporting them to the fraud departments.
  • Get your credit report. Review it for loans accounts that you do not recognize. Make sure the balances are correct. While it is illegal for you or your attorney to try to get a copy of your spouse’s credit report without consent, you can ask your spouse for permission. Your spouse’s credit report will show how much and to whom your spouse is indebted. You can ask your spouse for the report as a routine precaution against fraudulent creditors.
  • Search online for lawsuits and judgments against you and your spouse.
  • Change passwords for financial accounts and your computer and cell phone lock screens to keep your spouse from accessing them.

The impacts of financial infidelity on your credit and your future economic security can be devastating and long-lasting. An experienced attorney can help you to overcome them.  If you suspect that your spouse has committed financial infidelity or have any questions about your responsibility for marital debt and repairing the damage done, please contact Shintia Riva, Esquire at the Law offices of Spadea & Associates, LLC for free consultation at 610-521-0604.

Filed Under: Divorce, Family Law

Understanding Child Custody in Pennsylvania

March 13, 2024 by Leave a Comment

UNDERSTANDING CHILD CUSTODY IN PENNSYLVANIA

No issue is more important when parents separate than the custody and future of their children. Answering this question is also one of the most difficult and unwelcome decisions that a judge must make. The process is complex, the results uncertain, and often expensive. Multiple people, who are strangers to you, your spouse, and your children, can be involved, people such as court-appointed custody masters, psychiatrists, psychologists, social workers, and ultimately judges. All of them are looking out for the “best interests of the child.” None of them really know what that means.

To guide them all, Pennsylvania law requires that they answer a staggering number of invasive and uncomfortable questions – 16 in all! The Courts must answer difficult questions like:

  • Which parent is more likely to help foster contact the relationship between the child and the other parent;
  • Which parent is more likely to have a loving and stable relationship with the child; and
  • Which party is more likely to take care of the child’s daily physical, emotional, and educational needs.

They must also answer simpler questions like:

  • Which parent takes care of the child’s basic needs;
  • The availability of extended family;
  • The accessibility of child-care; and
  • The distance between the parents’ homes.

The Courts will even assess your own mental, emotional, and physical health.  If your child is old enough and mature enough, the Courts will take your child’s preferences into account. However, your child’s preferences are not supposed to be the controlling factor.

Custody masters and judges typically use these factors like a score card, ticking off boxes in favor of one parent or another. Then, they add up the score and make their decision. They do not simply give each factor the same weight and declare a winner, however. Moreover, the Courts may not make custody decisions based on gender.  They do, as a practical matter, though still prefer mothers of young children over fathers, which is hard for fathers to overcome. Some factors are more important than others. Some facts lean more heavily in favor of one parent or the other. Even with the factors, fundamentally no judge or custody master looks at the same facts in the same way. That is what makes it so difficult for a parent and their attorney to predict how a judge will decide a custody request.

Even if different judges may assess the factors the same way, at the end of the process they still must decide how to actually divide the custodial time. That decision will determine who gets weekdays, who gets weekends, who gets holidays and vacations, which school will they attend, and even possibly who drops the children off and picks them up. While there are some basic schedules used, different judges will establish different schedules.

For parents, who must leave their children’s home on short notice and do not have a second home for themselves and their children, securing custody of their children can be very hard financially. Courts will limit the out-of-home parent’s time, including overnights with their children, if that parent does not have enough bedrooms and beds for their children. But, setting up a second home on short notice is expensive and time-consuming, especially when, as is so often the case, displaced parents generally do not have much money for their own housing after paying child or spousal support. The amount of your custody time will also affect the amount of child support payments. To make matters more challenging, keeping up a good relationship with your child is particularly important just after separating for securing a good, long-term future with your child. So, displaced parents should try to make a suitable home for themselves and their children as soon as possible.

All of these considerations make the fight to protect your time and relationship with your children the most difficult and important aspect family separation.

If you need help establishing your right to custodial time with your children or have questions about child custody law in Pennsylvania, please contact Gregory J. Spadea at the Law Offices of Spadea & Associates, LLC at 610-521-0604 for free 20-minute consultation.

Filed Under: Divorce, Family Law

Why Common-Law Marriage in Pennsylvania is Not so Common After All

February 19, 2024 by Leave a Comment

Common-law marriage remains a hot topic in Pennsylvania, particularly for long-time, same-sex couples.  In the frontier days of Pennsylvania, when ministers, pastors, and judges were hard to find and even more difficult to meet, common-law marriages were a regular feature of life. Such marriages did not require a marriage license and a formal ceremony before a pastor who had legal authority to marry. Pennsylvania courts have long struggled when deciding if you are married by common-law when you don’t have a marriage license and there was no officiant or ceremony. The court’s determination could mean the difference between inheriting property from your spouse’s estate or losing all of the property that you built up over your years together. Today, the issue of whether or not you are in a common-law marriage also affects newly established rights, like Social Security spousal benefits and even death benefits under Workers Compensation laws.

When deciding whether you and your partner have a common-law marriage, Pennsylvania’s courts are required to answer many questions. Did you say the magic words, ”I take you as my spouse” or simply say, “I will marry you”? Did someone witness you saying those words? Did you live as spouses, and if so, for how long? Do you own a house together? Do you introduce your partner as your spouse? Do you go by your spouse’s last name? Have you filed tax returns together as spouses? Have you applied for credit cards together? Even, did you get mail addressed to you as Mr. and/or Mrs.? The most important question, though, is always whether the judge simply believes you. Courts were so distrustful of claims of common-law marriage, especially when one spouse was dead, that they imposed the highest burden of proof in civil cases, known as “clear and convincing” evidence. Sometimes, the courts made the correct decisions. Sometimes, they did not. Generally speaking, virtually no court saw or heard or believed the same evidence in the same way with the same result. There simply was no certainty.

To bring predictability to the legal status of marriage in Pennsylvania, its legislature passed a law that simply invalidates any common-law marriage that occurred after January 1, 2005. In other words, if you were not part of a common-law marriage on or before January 1, 2005, you are not married to your spouse under Pennsylvania law.  Common law marriages begun before that date could not be invalidated without violating the partners’ due process rights. Knowing your rights in common-law marriages is still important today, especially for same sex spouses.

Older same sex couples should be the most concerned because until 2014 Pennsylvania did not recognize the right to same sex marriage at all. Many of those marriages could still be valid in Pennsylvania. Each person in those marriages may have previously unknown rights to divorce, divide marital property, get or pay alimony, receive child support, share custody of children, and even inherit property that were not apparent before 2014.

Even if Pennsylvanians no longer can have valid common-law marriages after 2014, Pennsylvania courts must also still recognize out-of-state common-law marriages even today. However, Pennsylvania judges do not like deciding whether an out-of-state common law marriage is valid. It puts the Pennsylvania courts in the unwelcome situation of making decisions about a person’s rights under another state’s laws. Those legal rights judgments are particularly difficult for Pennsylvania judges to make because some states still do not recognize the right to same-sex marriage and many have different standards for common-law marriages. The few that still do recognize common-law marriages are considering legislation to invalidate them.

In the end, if you were in a common-law marriage in Pennsylvania on or before January 1, 2005, or are now in a common-law marriage that began in another state that recognizes common-law marriages, you may still be entitled to all of the rights of a spouse. Even if a court in your home state never decided whether you are in a common-law marriage, you may still be entitled to ask a Pennsylvania court to decide whether your out-of-state common-law marriage is valid under your home state’s laws and your marital rights protected.

If you think that you are a spouse in a valid, common-law marriage or have any questions about common-law marriage, please contact Gregory J. Spadea,, Esquire, at the Law offices of Spadea & Associates, LLC for free 20-minute consultation at 610-521-0604.

Filed Under: Family Law

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