Pennsylvania Wills vs. Trusts
Navigating Pennsylvania estate planning doesn’t have to be overwhelming. The Keystone State offers unique estate planning features including simplified probate for small estates under $50,000, inheritance tax rates that vary by relationship to the deceased, and flexible will execution requirements. Understanding the major differences between wills and trusts can save your family significant time, money, and stress while preserving your legacy in accordance with Pennsylvania’s distinct legal framework.
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US Map For The Different Will and Trust Requirements by State
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Pennsylvania Will Requirements
A Pennsylvania Last Will and Testament should include:
- Age and Capacity: Testator must be “of sound mind” and at least 18 years old
- Format: Must be in writing
- Signature: Must be signed by the testator at the end of the document
- Witnesses: Generally not required if signed by the testator (but recommended)
Signature Requirements
- The testator must sign at the end of the document
- Alternatively, someone else may sign on behalf of the testator at the testator’s direction and in the testator’s presence
- Text included beneath a testator’s signature does not invalidate a will but is not considered part of the will
Witness Requirements
A will signed personally by a Pennsylvania testator technically need not be witnessed, though inclusion of two witnesses eases the probate process. However, witnesses are required in these cases:
- A will signed by another person for the testator must be attested by two adult witnesses
- A will executed by affixing the testator’s mark where the signature would otherwise appear must also include signatures of two witnesses
When witnesses are required, they must be adults, and they must observe the testator stating that the document is in fact intended as the testator’s will.
Self-Proved Wills
A Pennsylvania will can be made “self-proved” by execution of a statutorily compliant notarized affidavit:
- The affidavit must include the testator’s acknowledgement of the will, along with attestation by the witness(es) that the testator signed the will of his or her own volition, for the purpose of creating a will, and while of sound mind
- When a self-proved affidavit is present, it serves as evidence of a will’s authenticity in probate, avoiding the need for witness testimony
- The Pennsylvania Legislature published a template for the affidavit within the Pennsylvania Consolidated Statutes
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Amendment, Revision, and Revocation of Pennsylvania Wills
Amending a Pennsylvania Will
Pennsylvania wills may be amended or revised through:
- Execution of a codicil (an addendum to an existing will)
- To effectively amend a will, a codicil must be executed in compliance with all legal requirements that apply to creation of a will
Revoking a Pennsylvania Will
An existing will or provisions thereof can be revoked through:
- Execution of a later will, codicil, or other written document signed by the testator expressing the intent to revoke the prior will
- Any document revoking a will must satisfy all formalities required for creation of a will
Automatic Revocation by Divorce
Holographic and Oral Wills
Holographic and Oral Wills
Neither oral (nuncupative) nor holographic (handwritten) wills are recognized under Pennsylvania law. However, a will written by hand, signed by the testator, and which otherwise satisfies the legal requirements for a valid will is effective.
Pennsylvania Trust Requirements
Pennsylvania has adopted the legal approach to trusts provided under the Uniform Trust Code (enacted as the Pennsylvania Uniform Trust Act).
Trust Creation Requirements
To create a valid Pennsylvania trust:
- The trust must be evidenced by a written instrument that is signed by the grantor and expresses the intent to create a trust
- The grantor must have legal capacity to create the trust—for revocable trusts, the capacity standard is the same as with a will
- The trustee must have actual duties to perform
- Trusts must usually have a definite beneficiary—subject to a few exceptions such as animal trusts, charitable trusts, and trusts granting the trustee authority to select a beneficiary from among a class
Trust Purpose
A Pennsylvania trust can serve any purpose that is not unlawful or in violation of the Commonwealth’s public policy.
Trust Creation Methods
A Pennsylvania trust becomes effective when:
- The grantor transfers title to one or more assets to a trustee for a beneficiary’s benefit
- Upon the grantor’s declaration that he or she holds property as trustee for someone else’s benefit
- Upon execution of a written appointment of a trustee
Trust Termination
A Pennsylvania trust is terminated when:
- It is revoked or expires under the terms of the trust instrument
- When the trust’s purpose has been achieved
- When the purpose is no longer lawful or has become contrary to public policy
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Special Considerations
Inheritance Tax
State Inheritance Tax Rates
Pennsylvania is among the handful of states that tax inheritances received by residents. The tax rate varies according to the familial relationship between the decedent and heir:
- Spousal inheritances: 0% (untaxed)
- Direct lineal descendants (children, grandchildren): 4.5%
- Siblings: 12%
- Unrelated individuals or more distant relations: 15%
Simplified Probate
Small Estate Procedures
Pennsylvania provides a streamlined probate procedure for “small estates” (defined as less than $50,000, excluding real estate and funeral expenses). If small estate proceedings are approved, an executor can distribute estate assets to beneficiaries without going through the full probate process.
Penalty Clause
No-Contest Provisions
A provision penalizing a beneficiary or other interested party for contesting a will or trust or commencing other estate-related proceedings is unenforceable under Pennsylvania law, as long as the contesting person has probable cause to bring the proceedings.
Trust for Care of Animals
Pet Trusts
Pennsylvania law permits creation of trusts for the care of one or more companion animals:
- The beneficiary animal must be living when the trust is created
- The assets funding the trust must be reasonable for the trust’s purpose
- “Pet trusts” may be created by will
- The trust automatically terminates upon the death of the applicable animal(s)
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Wills vs. Trusts: Comparison
| Feature | Wills | Trusts |
|---|---|---|
| When It Takes Effect | After death | Can be immediate (living trust) or after death (testamentary trust) |
| Probate Process | Requires probate | Assets in trust avoid probate |
| Privacy | Public record | Generally private |
| Challenges | Can be challenged in probate court | More difficult to challenge |
| Cost to Create | Generally less expensive | Usually more expensive |
| Ongoing Administration | None until death | May require ongoing management |
| Protection During Incapacity | None (requires separate power of attorney) | Can provide management if grantor becomes incapacitated |
| Pennsylvania Special Feature | Witness signature not required if personally signed by testator | Pet trusts recognized; based on Uniform Trust Code |
Conclusion
Creating a will or trust does not have to be difficult or intimidating for Pennsylvania residents. However, certain circumstances—like second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests—can add complexity and result in unforeseen consequences.
Pennsylvania offers unique estate planning features including flexible will execution requirements (no witnesses needed if personally signed by the testator), simplified probate for small estates under $50,000, and inheritance tax rates that vary by relationship to the deceased. The state’s adoption of the Uniform Trust Code provides a robust framework for trust formation and administration, including specific provisions for pet trusts.
Understanding Pennsylvania’s spousal elective share rights and the treatment of no-contest clauses can help you create an effective estate plan that meets your goals while avoiding potential pitfalls. When any out-of-the-ordinary issues are present, it’s advisable to consult with an experienced attorney familiar with and licensed under Pennsylvania law.
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FAQs: Pennsylvania Wills and Trusts
Q: What are the requirements for a valid will in Pennsylvania?
A: A valid Pennsylvania will must be in writing, signed by the testator (who must be at least 18 and of sound mind) at the end of the document. Unlike most states, Pennsylvania does not require witnesses if the testator personally signs the will, though having two witnesses is recommended to ease the probate process. However, witnesses are required if someone else signs on behalf of the testator or if the testator signs with a mark instead of a signature. The will can be made “self-proved” with a notarized affidavit, which eliminates the need for witness testimony during probate.
Q: How does Pennsylvania’s inheritance tax work?
A: Pennsylvania is one of the few states that collects inheritance tax, with rates that vary based on the relationship between the deceased and the beneficiary. Spouses are completely exempt (0% tax rate). Direct descendants like children and grandchildren pay 4.5%. Siblings are taxed at 12%. All other beneficiaries, including nieces, nephews, friends, and non-relatives, pay the highest rate of 15%. The tax applies to most assets passing to these beneficiaries, whether through a will, trust, or intestacy. Certain exemptions exist, such as life insurance proceeds paid to a named beneficiary and property jointly held with a spouse.
Q: Can I avoid probate with a small estate in Pennsylvania?
A: Yes, Pennsylvania offers a simplified probate procedure for “small estates” valued at less than $50,000, excluding real estate and funeral expenses. If an estate qualifies, the executor can petition the court for permission to distribute assets without going through the full probate process. This can save considerable time and expense. For larger estates, consider other probate-avoidance strategies like living trusts, payable-on-death designations for financial accounts, transfer-on-death registrations for securities, or joint ownership with right of survivorship.
Q: How are surviving spouses protected under Pennsylvania law?
A: Pennsylvania provides significant protections for surviving spouses through the elective share right. A surviving spouse can claim one-third of the decedent spouse’s estate, even if the will provides less or nothing at all. This elective share includes both probate assets and assets in trusts that were revocable at the time of death. Additionally, if a will was executed before marriage and doesn’t mention the spouse, the surviving spouse is entitled to receive the same share they would have received if there had been no will (intestate share), unless the will was made in contemplation of the marriage.
Q: Are no-contest clauses enforceable in Pennsylvania?
A: No-contest clauses (also called penalty or in terrorem clauses), which attempt to penalize beneficiaries for contesting a will or trust, are not enforced in Pennsylvania if the person contesting the document has probable cause to do so. This means that if someone has a reasonable basis for challenging a will or trust, they can do so without fear of losing their inheritance, even if the document contains a provision threatening disinheritance for contesting it. This protection encourages legitimate challenges to fraudulent or improperly executed estate documents.
Q: Can I create a trust for my pets in Pennsylvania?
A: Yes, Pennsylvania specifically authorizes trusts for the care of companion animals. To create a valid pet trust, the animal must be alive when the trust is created, and the funding must be reasonable for the trust’s purpose. You can establish the trust either during your lifetime or through your will. The trust automatically terminates when your pet passes away. This provides peace of mind that your beloved companion animals will be properly cared for according to your specific instructions if you become incapacitated or after your death.
Q: What happens to my will if I get divorced in Pennsylvania?
A: In Pennsylvania, if you divorce after executing a will, any provisions benefiting your former spouse are automatically revoked by operation of law. This includes not only direct bequests but also provisions naming your ex-spouse as executor, trustee, or guardian. The law treats these provisions as if your former spouse predeceased you. The same rule applies even if you die during divorce proceedings, as long as grounds for divorce have been established. However, if your will explicitly states that the provisions should remain effective despite divorce, then they will remain valid despite the divorce.
