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  • Feb 05, 2020The Secure Act and Its Impact on Your Estate Plan

    As the festivities of the New Year have waned and we approach Tax Season, we bring you news of a recent legislative development that warrants your attention and may require changes to your estate plan. During the final weeks of 2019, Congress enacted federal tax legislation known as the “SECURE Act.”

    The SECURE Act

    The law makes important changes to the federal tax code that will impact distributions from retirement accounts such as 401(k)s, 403(bs)s, IRAs, and tax-qualified annuities (referred to in this legal advisory collectively as “Retirement Accounts”). Those changes may affect you during your lifetime and may also affect the way Retirement Accounts are distributed to your beneficiaries after your death. Consequently, the law may also limit your ability to protect retirement accounts from your beneficiaries’ creditors in a tax-efficient manner.

    This legal advisory summarizes the key aspects of the SECURE Act, which is effective as of January 1, 2020, that may affect your estate plan. We hope you find it helpful in understanding certain major changes enacted by this legislation and how they might affect you. However, bear in mind that the law will affect everyone differently. Therefore, we strongly urge you to contact our office to arrange a time for us to discuss this new law in detail, so that we may act to make any necessary revisions to your estate plan as soon as possible.

    Changes Affecting You

    One component of the SECURE Act that will affect many people during their lives is a change in the age at which a person must begin taking distributions from a Retirement Account. Prior to the SECURE Act, most people (except those who were not yet retired) were required to begin taking distributions from Retirement Accounts by April 1st of the year following the year in which they reached age 70 ½. Under the SECURE Act, the age is increased to 72 for those who were not yet required to take distributions under the old law.

    Also, the SECURE Act removes the age cap for funding traditional (non-Roth) IRAs, meaning that qualifying individuals over age 70½ are now eligible to make deductible and nondeductible contributions to a traditional IRA (and may, in some instances, present additional opportunities for funding a Roth IRA).

    These changes involve additional detail and nuance beyond the summary provided in this Alert and may present an opportunity for some to take further advantage of the tax-deferred savings offered by Retirement Accounts. Feel free to reach out to any member of the Norris McLaughlin Trust, Estate, and Individual Tax Law Practice Group to discuss those opportunities in coordination with your accountant or financial advisor.

    Changes Affecting Your Beneficiaries

    Perhaps the most significant changes concerning estate planning brought about by the SECURE Act regard how Retirement Accounts are distributed after the account holder’s death to avoid penalties while continuing to defer taxes. Under prior law, it was possible to “stretch” the distribution of inherited Retirement Accounts over the life expectancy of a beneficiary. Beneficiaries were required to take a required minimum distribution each year based on their life expectancy and the undistributed balance of the Retirement Account could continue to grow income tax-free. Better yet, leaving the balance of a Retirement Account to a trust, properly drafted to meet IRS requirement, for the benefit of a beneficiary, could protect retirement benefits from the beneficiary’s creditors and ensure that those benefits remain in the family upon the beneficiary’s death, while still benefiting from income tax-free growth for the undistributed portion of the Retirement Account.

    The SECURE Act has changed those rules so that most beneficiaries will be required to receive the full amount of an inherited Retirement Account within 10 years of the death of the person who funded the Retirement Account. Certain beneficiaries, including your spouse; your minor children (but not grandchildren); and beneficiaries who are disabled, chronically ill, or no more than 10 years younger than you, are exempt from the 10-year rule and are still permitted to take distributions over their expected lifetimes (although, children who are minors at the time of inheritance must now take the full distribution within 10 years of reaching the age of majority). However, Retirement Accounts left to those beneficiaries in trust might not qualify for the life expectancy payout, depending on the terms of the trust. Even special needs trusts might require review, as they must be structured narrowly to ensure that the stretch is preserved. Provisions that allow the trust to benefit another individual might be problematic.

    The good news is that the SECURE Act does not change the method of designating your beneficiaries to receive Retirement Accounts. If you have existing beneficiary designations in place, those designations are still valid. However, the SECURE Act does introduce a host of new considerations that must be taken into account when structuring your estate plan to maximize the benefit of Retirement Accounts and best protect your beneficiaries.

    Unfortunately, Congress gave us little warning that these changes were imminent. Accordingly, estate plans that previously offered a sound approach to planning for Retirement Accounts may no longer provide a good solution.  For example, some of you may have plans in place that leave Retirement Accounts to a trust known as a “Conduit Trust.” All distributions from Retirement Accounts paid to a Conduit Trust must be distributed directly from the Trust to the beneficiary. That might have been a good approach under the old law since distributions could be stretched over the expected lifetime of the trust beneficiary. However, under the SECURE Act, that same Conduit Trust might now require distribution of the entire Retirement Account to the beneficiary within 10 years of the death of the account owner or upon a minor child reaching the age of majority. Depending on the circumstances, under the SECURE Act, other planning techniques might better serve the goals those plans are meant to achieve.

    Take Action

    With the implementation of the SECURE Act effective January 1st of this year, we recommend that we review your estate plan as soon as possible to ensure that it disposes of your Retirement Accounts in keeping with your objectives.  We welcome the opportunity to discuss these changes with you, answer any questions you may have, and make recommendations specifically for you. Please contact our office to arrange a meeting or phone conference at your earliest convenience so that we can help you find the best planning solutions to meet your needs and those of your family.

    Note:  The contents of this letter are for informational purposes only and are not intended to constitute legal advice or form an attorney-client relationship. For information and advice particular to your situation, please contact one of the following attorneys in our Trust, Estate & Individual Tax Practice Group:  A. Nichole Cipriani, James J. Costello, Jr., Shauna M. Deans, Nicholas J. Dimakos, Robert E. Donatelli, Victor S. Elgort, Michelle M. Forsell, Hon. Emil Giordano (Ret.), Christopher R. Gray, Judith A. Harris, Abbey M. Horwitz, Dolores A. Laputka, Jill Lebowitz, Kenneth D. Meskin, Michael T. Reilly, Shana Siegel, Milan D. Slak, Burt Allen Solomon.

    Posted in: A. Nichole Cipriani, Abbey M. Horwitz, Burt Allen Solomon, Christopher R. Gray, Dolores A. Laputka, Estate Planning & Administration, Hon. Emil Giordano (Ret.), James J. Costello, Jill Lebowitz, Judith A. Harris, Kenneth D. Meskin, Michael T. Reilly, Michelle M. Forsell, Milan D. Slak, Nicholas J. Dimakos, Robert E. Donatelli, Shana Siegel, Shauna M. Deans, Taxation, Victor S. Elgort |

  • Jun 12, 2019Norris McLaughlin Members Admitted to the U.S. Supreme Court

    The law firm Norris McLaughlin, P.A., is proud to announce that Members of the firm, Robert E. Donatelli and Rebecca J. Price, were admitted to the U.S. Supreme Court on Monday, June 10, at the 2019 Bar Association of Lehigh County (BALC) Bench Bar Conference & Supreme Court of the United States Admissions Ceremony in Washington, D.C

    Michelle M. Forsell, Of Counsel to the firm, moved for admission to the Court for 21 members of The Bar Association of Lehigh County, including Donatelli and Price.  “It was an honor to move members of my local bar association for admission to the Supreme Court,” said Forsell. “And to have Bob and Rebecca included in those members made it even more meaningful for me.”

    The Annual Bench Bar Conference is a 3-day event for BALC judges, attorneys, and others. The weekend included a cocktail reception, CLE seminars, group activities, and a formal Sunday brunch. For more information, please click here.

    Donatelli has over 40 years of experience in estate administration, wills and trusts, and real estate law. He helps clients with all aspects of estate planning – will preparation, tax issues, guardianships, powers of attorney, living wills, living trusts, and special needs trusts; and estate administration – the process of probate, valuing and managing the estate, and executing decisions on guardianships and conservatorship. In real estate law, he advises clients on residential and commercial sales transactions, real estate contracts, mortgages, re-finances, foreclosures, eminent domain, title insurance, and title disputes. Donatelli is AV® Preeminent™ Peer Review Rated by Martindale-Hubbell®. He is a former solicitor of the Register of Wills of Lehigh County; currently serves as Chair of the City of Allentown, Board of Ethics; is active in the Bar Association of Lehigh County, where he served as President in 1985; and is a member of the Barristers Inn of Court, where he served as President. Donatelli received his J.D. from University of Kansas School of Law in 1963 and his A.B. from Muhlenberg College in 1960.

    As a commercial litigator, Price represents clients in the eastern counties of Pennsylvania, the Eastern and Middle Districts of Pennsylvania, and the District of New Jersey. She is involved in complex commercial business litigation, landlord/tenant matters, and contract disputes. In her general litigation practice, Price represents numerous insurance companies’ insureds in a wide spectrum of civil matters, and has also represented clients in personal injury matters. She represents local and out-of-state banks in bankruptcy, complex foreclosures, receiverships, and asset recovery matters, including negotiating deed in lieu transfers and confession of judgment for ejectment and money proceedings. She has also defended clients in actions to open or strike judgments entered by confession. She received her J.D. from William and Mary School of Law in 2007 and her B.A., summa cum laude, from Ohio State University in 2004.

    Forsell focuses her practice primarily on estate planning and administration, and municipal law. She represents clients in all aspects of estate planning, including the preparation of wills, trusts, powers of attorney, and health care directives, with careful analysis to minimize the tax liabilities resulting from such planning. Former Solicitor to the Borough of East Greenville, she is experienced in drafting and implementing resolutions and ordinances, complying with the Right to Know law, and dealing with zoning and land use issues and tax appeals. Forsell serves as a Montgomery County Arbitrator, and teaches law courses at Cedar Crest College. She is a board member of the Gulack Foundation, the Upper Perkiomen YMCA, the Villanova Law Inn of Court, and the Upper Perkiomen Valley Chamber of Commerce. She is secretary of the Board of Directors and Chair of the Governance Committee of Frederick Living, a Mennonite Health Services not-for-profit continuing care retirement community. Forsell received her J.D. from Villanova University School of Law in 2003, her M.A. from Temple University in 2006, and her B.A. from West Chester University of Pennsylvania in 1999.

    Posted in: Banking & Financial Services, Bankruptcy & Creditors' Rights, Estate Planning & Administration, Litigation, Michelle M. Forsell, News, Rebecca J. Price, Robert E. Donatelli, Taxation | Tags: , , ,

  • Apr 04, 2019Robert Donatelli Reappointed to the City of Allentown Board of Ethics

    Robert E. Donatelli, a Member of law firm Norris McLaughlin, P.A., has been reappointed to the City of Allentown Board of Ethics, which is responsible to administer the City’s Code of Ethics. He was reappointed by Allentown Mayor, Ray O’Connell, with the advice and consent of Council. His second 3-year term will run through December 15, 2021.

    Donatelli has over 40 years of experience in estate administration, wills and trusts, and real estate law. He helps clients with all aspects of estate planning – will preparation, tax issues, guardianships, powers of attorney, living wills, living trusts, and special needs trusts; and to estate administration – the process of probate, valuing, and managing the estate, executing decisions on guardianships and conservatorship.

    In real estate law, he advises clients on matters of residential and commercial sales transactions, real estate contracts, mortgages, re-finances, foreclosures, eminent domain, title insurance, and title disputes. He handles land use, zoning, and permit matters.

    Donatelli is AV® Preeminent™ Peer Review Rated by Martindale-Hubbell®. He is a former solicitor of the Register of Wills of Lehigh County; is active in the Bar Association of Lehigh County, where he served as President in 1985; and is a member of the Barristers Inn of Court, where he also served as President. Donatelli received his A.B. from Muhlenberg College in 1960, and his J.D. from University of Kansas School of Law in 1963.

    Posted in: Estate Planning & Administration, News, Real Estate & Finance, Robert E. Donatelli | Tags: , , , ,

  • Dec 07, 2017Robert Donatelli Elected to Board of Directors for Allentown Symphony Association

    Robert E. Donatelli, a Member of Norris McLaughlin, P.A., has been elected to the Board of Directors for the Allentown Symphony Association. The Association’s mission is to provide a first-class symphony orchestra and Hall, quality performing arts, and cultural education in partnership with the community.

    “The Allentown Symphony Association contributes to the cultural richness of the Lehigh Valley.  I am happy to serve by being a member of its Board of Directors,” said Donatelli.

    Donatelli, a resident of Wescosville, has over forty years of experience in estate administration, wills and trusts, and real estate law.  Donatelli helps clients with all aspects of estate planning and administration, including will preparation, tax issues, guardianships, powers of attorney, living wills, living trusts, special needs trusts, the process of probate, valuing, managing the estate, and executing decisions on guardianship and conservatorship. In the area of real estate law, Donatelli advises clients on matters of residential and commercial sales transactions, real estate contracts, mortgages, re-finances, foreclosures, eminent domain, title insurance, and title disputes.  He also handles land use, zoning, and permit matters.

    Donatelli is AV® Preeminent™ Peer Review Rated by Martindale-Hubbell®.  He is a member of the Ethics Board of the City of Allentown and a former solicitor of the Register of Wills of Lehigh County.  He is a Board Member of the Bar Association of Lehigh County, serving as President in 1985, and is a member of the Barristers Inn of Court, where he also served as President. He is the President of the Friends of the Allentown Parks.

    A graduate of the University of Kansas School of Law, Donatelli is admitted to practice in Pennsylvania and the U.S. District Court, Eastern District of Pennsylvania.

    Posted in: News, Robert E. Donatelli | Tags: , ,

  • Jan 13, 2017Robert E. Donatelli Re-Elected to Board of Directors of Bar Association of Lehigh County

    Robert E. Donatelli, a Member of Norris McLaughlin, P.A., has been elected to another term on the Board of Directors of the Bar Association of Lehigh County.

    Donatelli, a resident of Wescosville, has over forty years of experience in estate administration, wills and trusts, and real estate law.

    Donatelli helps clients with all aspects of estate planning and administration, including will preparation, tax issues, guardianships, powers of attorney, living wills, living trusts, special needs trusts, the process of probate, valuing, managing the estate, and executing decisions on guardianship and conservatorship.

    In the area of real estate law, Donatelli advises clients on matters of residential and commercial sales transactions, real estate contracts, mortgages, re-finances, foreclosures, eminent domain, title insurance, and title disputes.  He also handles land use, zoning, and permit matters.

    Donatelli is AV® Preeminent™ Peer Review Rated by Martindale-Hubbell®.  He is a member of the Ethics Board of the City of Allentown and a former solicitor of the Register of Wills of Lehigh County.  He is active in the Bar Association of Lehigh County, serving as President in 1985, and is a member of the Barristers Inn of Court, where he also served as President.

    A graduate of the University of Kansas School of Law, Donatelli is admitted to practice in Pennsylvania and the U.S. District Court, Eastern District of Pennsylvania.

    Posted in: News, Robert E. Donatelli | Tags: , , ,

  • May 05, 2015Norris McLaughlin, P.A. Welcomes New Trusts & Estates Member

    The Pennsylvania office of Norris McLaughlin, P.A., welcomes new Member Robert E. Donatelli to its Estate Planning and Administration Group. He joins the Norris McLaughlin, P.A.after almost 50 years with his successful trusts and estates and real estate firm, the Law Office of Robert E. Donatelli.

    “We are very excited to have Bob join the firm.  After 50 years of representing trusts and estates clients, and many of those years right down the street from our new offices in Allentown, it is a natural fit for Bob to come aboard and join our existing estate planning and administration group,” said Matthew Sorrentino, Chairman of the firm.

    “It is essential for lawyers to adapt to ensure they meet changing client needs and expectations. Norris McLaughlin, P.A.really understands this and has the depth and breadth of services to address virtually any need of my existing client base,” Donatelli said.

    Donatelli, a resident of Wescosville, focuses his practice on estate planning, wills and trusts, estate administration, and real estate matters.  He represents individuals in all aspects of general and sophisticated estate planning, including drafting wills, special needs trusts, guardianships, powers of attorney, living wills and trusts, and estate administration.  He handles residential and commercial real estate matters from sales transactions, refinancing and title disputes to land use, zoning and permitting.

    A 1963 graduate of the University of Kansas School of Law, Donatelli is admitted to practice in Pennsylvania and the U.S. District Court, Eastern District of Pennsylvania.

    Posted in: Estate Planning & Administration, News, Robert E. Donatelli |

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