October 2008 Archives

October 30, 2008

Who can be a Florida personal representative?

In Florida what happens to a person's assets if they die without a will? Under Florida probate law, if a person dies without leaving a will the decedent's estate is dealt with under Florida's Intestate statutes. Even if a Florida resident dies intestate, the decedent’s assets will be transferred to their family members. Only when there are no family members will the assets escheat to the state or be transferred to the state. Generally Florida's intestate statutes go to great lengths to find a relative to leave a decedent's assets to.


In Florida the decision to create Florida Will that appoints a personal representative to administer your probate assets is a wise decision. It is important to consider who can be a personal representative. With Florida probate law, the personal representative can be an individual, bank or a trust company. For an individual to act as a representative they must be legal residents of the state of Florida or a relative or spouse of a sibling, parent, or child. A person who is not a legal resident and is not closely related to the decedent cannot act as an executor or a personal representative of the decedent's estate. In addition a trust company that is incorporated under Florida laws or which is a bank or lending agency and is licensed to extend fiduciary lending in the state of Florida can also act as a personal representative of a Florida probate.

Update:
Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.

October 30, 2008

Florida probate law and dying without a will

In Florida what happens to persons assets if they die without a will? Under Florida probate law, if a person dies without leaving a will the decedent's estate is dealt with under Florida's Intestate statutes. Even if a Florida resident dies in intestate, the decedent’s assets will be transferred to their family members. Only if there are no family members will the assets escheat to the state or be transferred to the state. Generally Florida's intestate statutes go to great lengths to find a relative to leave a decedent's assets to.

Update:
Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.

October 29, 2008

Who presides in matters of Florida probate?

When a decedent's assets go into probate in Florida the Florida Probate Case will be in the county court where the decedent maintained his or her domicile.

Pursuant to Florida probate law a judge will normally decide and rule on the validity of a will. The judge will also rule on who the heirs are should there be a question or dispute as to the validity of a decedent's heirs.

If the decedent appointed a personal representative to administer the Florida will, the judge will determine if the representative is qualified administer the estate. If there are no objections and the judge determines that the representative qualified, the judge will issue letters of administration. These letters of administration allow the executor or personal representative to administer the will. Any issues or conflicts that arise during the representative's administration will be ruled on by the circuit court judge.

October 28, 2008

Florida Will leaves everything to ex wife

In Florida, if you were married when a will was created by your spouse, a subsequent divorce will treat you as predeceasing your spouse in most cases. Even if you were living with your ex spouse, engaged, or had a new wedding date planned, a will executed before the divorce would not be valid in regards to anything devised from a person to his or her ex-spouse.

It is possible to talk with the family and if they agree, the beneficiaries can work together with the ex-spouse to provide assets after the death. The ex-spouse has no legal right to receive assets but it can be negotiated in a friendly arrangement.

If you are an ex-spouse who was friendly with their ex, contact a Florida Estate Planning Lawyer to discuss your options.

if you have been divorced or reacquainted with someone from a prior marriage, it is important to update your Jacksonville Estate Planning Documents to reflect your current intentions.

October 27, 2008

Using Quicken to prepare a trust: The good, the bad, and ugly!

I recently receive a copy of Quicken Willmaker 2009. I have previously written about many articles about the unintended results that occur with Do It yourself and Free Estate Planning Documents created by individuals without the advice of counsel and the problems with online document preparation services like LegalZoom and RocketLawyer.

I decided to try out a few of the documents in Quicken to see if they had improved the quality and accuracy of their Florida documents. Last week I wrote about problem with the Quicken Willmaker 2009 Durable Power of Attorney. This week I will be looking a the Revocable Living Trust. I have previously written about the many problems in using Quicken to create a Firearms Trust but for this article I will be focusing on the typical issues with regular estate planning and living trusts.

1. No free updates and old language, in order to keep your trust up to date, you need to purchase the software every year and hope they have dealt with changes in your state laws. Quicken seems to be slow at incorporating small or significant changes in the law. The changes in the new trust code from Florida in the years 2006 and 2007 have not been incorporated into the software. Quicken does not let you know what years statutes its language is based upon. Quicken states that when their users report problems they try to fix the program. Unfortunately, their users are not lawyers, and their users never find out about the problems. Their family may find problems when it is to late to make changes, but they have no way to ask, nor to they attempt to ask the beneficiaries to report problems.

2. Review your document is advice given to the users by Quicken. Quicken's instructions also state to make sure that your document says exactly what you want it to. Although Quicken recommends that you have your document reviewed by an attorney, they neglect to mention that useful advice in their instructions under the review section. Living trusts are complicated documents, how the state law interprets the language you choose is complicated. Lawyers have differing interpretations, how can a non-lawyer pretend to understand what the outcome of the language they choose will be. Want proof of this, check out Do It yourself and Free Estate Planning Documents and see some of the results that have occurred when users attempted to make their own trusts and wills.

3. Register your trust with the court? Quicken incorrectly advises that you must register your living trust with your local court. Although there are some states that do require this they incorrectly state that it is a requirement in Alaska, Colorado, Florida Hawaii, Idaho Maine, Michigan, Missouri, Nebraska, and North Dakota.

4. Quicken WillMaker Doesn't Provide Legal Advice. The instructions state later that Quicken published legal forms that are useful in many situations but they can not tell you whether or not a form is right for you, given your circumstances. Only a lawyer can do this and you should consult a licensed attorney in your state.

The Trust

5. Part 2 of the trust declares that the assets mentioned in the trust have been delivered. While this may work for an assignment of interest, anything requiring a deed can not be transferred by this language. Individuals should not rely on this misleading statement and believe that their assets are transferred because they sign a sheet of paper that states that they have.

6. Revocation and Amendments: The Quicken trust allows revocation after one of the grantor's dies. Typically a revocable trust becomes irrevocable and cannot be changed once a settlor or grantor dies. Quicken does make this distinction when dealing with an amendment and states that the trust cannot be amended once a Grantor dies. I am not sure why or how they allow a trust to be revoked by not amended after the death of a Grantor.

7. Amendment by power of attorney: Florida case law states that a trust must specifically allow for amendment by a durable power of attorney, and the durable power of attorney must authorize the act specifically. The quicken trust includes language that the trust shall not be amended by an agent unless the document creating that power authorizes the amendment. This may or may not comply with the case law. It would be simple to ensure that it did comply compared to the language that is used.

8. Income. The Grantors are required to take all income from the trust at least annually. It would seem that this creates assets that are subject to probate and may not be what the individuals desire.

9. Successor Trustee. The successor trustee is chosen automatically but there does not appear to be an ability for someone else to choose a more appropriate trustee at the time one is needed. Quicken does give the last serving trustee the ability to appoint a new trustee if the successor trustee is unable or unwilling to serve. What happens if the trustee ceases serving because of death, who would have the power to appoint a new trustee? Quicken leaves this question unanswered.

10. Compensation. While Quicken allows for several choices for compensation, their no compensation choice does not contemplate the need to have a professional or corporate trustee.

11. Powers. The Quicken trust states that the trustee has all the authority and powers allowed or conferred on a trustee under Florida law. They do not tell you what these powers or authorities are or where to find a list of them. Also are they the powers granted when the document was signed, or when one goes to use the powers. While this may not seem important one should consider the substantial changes made in the area of a trustee's powers within the last 2 years in Florida.

12. Incapacity: Quicken gives the power to determine incapacity to a person, rather than a court conservator or guardian, or physicians. Under this trust it would be very easy for your children or whom ever you select to declare you incapacitated, remove you a trustee, and appoint a successor trustee of their choice.

13. Beneficiaries. Although quicken does appear to do a better job of checking the names of a beneficiary to make sure it is not a grantor, they only look for an exact match and do not question names that are close or provide a warning for any name. I found that it was possible to name yourself as your own beneficiary using a slightly different name, misspelling, or middle initial. This creates several problems and can void the trust.

14. Survivorship. The quicken trust voids a gift to a beneficiary if that beneficiary dies within 120 hours. This can cause some big problems when there are large unpaid medical bills related to the death of a beneficiary. To deal with this issue completely you should contact an estate planning lawyer.

15. Spendthrift provisions. Quicken does not make a mistake in this area because they do not address the concept.

16. Property transfer. Quicken does not address the potential for a re-evaluation of property taxes upon the transfer of a piece of property into the trust when the names on the trust are different than the current title on the property. Nor does quicken address the requirement that taxes may be assessed.

17. Choice of law, venue, arbitration, required notices under Florida Trust code. Quicken does not address these, perhaps they are not important. Whether that is true depends on your circumstances and what happens in the future, where you live when you die, where your beneficiaries live when you die. I personally feel that every trust should address these issues including the requirements of the new Florida Trust code, but if you use Quicken you will not have the benefit of these provisions either.

There are many mistakes in the Quicken documents, most disturbing might be some of the things that are not included in a Quicken trust. Quicken gives none of the flexibility to a trust that make it useful for the common person. A trustee under a Quicken trust could not do anything without creating liability to a beneficiary because by default they must act as a prudent trustee. If you have a trust created by Quicken 2009, 2008, 2007 or a previous version, you should have it reviewed by an estate planning lawyer. If you are in Jacksonville or anywhere in Florida Contact us about reviewing your Quicken Revocable Trust.

October 16, 2008

Free Florida Durable Power of Attorney and related problems - Quicken 2009 Florida Problems (part 1)

I recently receive a copy of Quicken Willmaker 2009. I have previously written about many articles about the unintended results that occur with Do It yourself and Free Estate Planning Documents created by individuals without the advice of councel and the problems with online document preparation services like LegalZoom and RocketLawyer.

I decided to try out a few of the documents in Quicken to see if they had improved the quality and accuracy of their Florida documents.

Problems and issues I encountered with the Quicken Durable Power of Attorney.

1) Willmaker 2009 now attempts to verify duplicate names but only catches them in the event that they are spelled exactly the same, they do no use any fuzzy logic to find and warn about names that are close. For Example David Goldman could be the agent for Dave Goldman, David M. Goldman, or David Michael Goldman. Although it will catch an exact duplicate, this problem allows for potentially invalid documents to be created.

2) The instructions suggest that the DPA must be filed at the courthouse to become effective, this is not true in Florida.

3) The instructions suggest that a revocation is not effective unless you file it with the courthouse and notify anyone who has a copy with the revocation. Although this is a good idea, the point of filing it with the courthouse is to put the world on notice. It is impossible to know everyone who would have received a copy or acted upon the validity of a Durable Power of attorney in the past. This can cause the individual to spend more than $120 in unnecessary filing fees.

4) The document does not comply the the Florida Statutes for Durable Powers of Attorney and as such the individual or agents have no right to sue and collect costs and fees associated with the improper denial of authority granted under the Durable power of attorney.
5) The document is effective upon the execution of the agreement, there is no option for deployment contingent (becoming effective upon incapacity), nor is there an option to limit the time that the document will be effective for. This is significant problem because it assumes that everyone wants to grant their agent the power to do anything they want and right now. In fact, very few individuals want to grant this type of power, and most who initially do, change their mind after learning what they will be doing from an attorney.

6) Their instructions warn that their conversion utility may not make an accurate conversion to Microsoft Word or RTF formatting so you need to verify that the versions are the same. This seems like something that they should have done prior to releasing the product to the public.

7) They inaccurately state that the witnesses signatures must appear on the same page as yours.

8) they do not save the footers and suggest that you break each section into a unique document and insert footers with the instructions found in the manual. This is not necessary and for most documents the footers are unnecessary and not a requirement of Florida Law.

9) States that the agent must have the original Durable Power of Attorney to act. A copy of the Durable Power of attorney is just as valid as the original. In fact, if you follow their MANDATORY (but not really mandatory) instructions of filing the document in the county records the original may be kept they the county.

10) They recommend asking your Agent not to use it unless your incapacitated. There is no requirement for them not to act, and no liability for the agent if he does act. This is not the proper way of dealing with this issue under the Florida Statutes.

11) They do have a nice warning which states that if you do not understand anything about this document you should ask a lawyer to explain it to you. We are not sure if that warning is intended for the agent or the principal.

12) Quicken appears to have a provision which creates a Pre-Need Guardian designation within their power of attorney. Typically this is a separate document which is filed in the county records. Although, if you file the recommendation and file the document in the county records, there would appear to be a public record of this request, it might be overlooked or ignored by the court because it is hidden inside a power of attorney. In addition, by statute, a DPA becomes ineffective once you receive notice of a pending petition for guardianship. This would appear to make your nomination invalid during that time.

SUMMARY: While the Quicken WIllMaker can produce a valid Durable Power of Attorney in Florida banks, businesses, and others can refuse to honor it without liability because it does not comply with the Florida statutes. You can also create invalid document, will unnecessarily spend more than an additional $120 in state filing fees, create a potentially invalid pre-need guardian selection, and expose yourself to unnecessary risk and liability.

Conclusion: For around the same price as the software and the recording fees, you can have an attorney discuss your needs and draft a document that provides you additional protections that comply with Florida law. In addition, for most people a deployment contingent Durable Power of Attorney is what is needed compared to the higher risk document created by Quicken. There are many mistakes and misguidance found within the generic documents created by the software package.

If you are looking for a Free or Low cost Durable Power of attorney, it may be less expensive and a better value to contact a Florida Estate Planning Lawyer.

October 15, 2008

Charitable IRA rollovers are back

The provision allowing IRA owners over age 70 ½ to transfer up to $100,000 of their IRA directly to charity has been RETROACTIVELY extended through the end of 2009 (as if it never expired).

This provision was part of the massive bailout legislation officially known as the “Emergency Economic Stabilization, Energy Improvement and Extension, and Tax Extenders and AMT Relief Acts of 2008”

It is so far being referred to in the short version as The “2008 Economic Stabilization Act”

H.R. 1424 was signed into law by the President on October 3, 2008.

October 14, 2008

NEW FDIC Rules for Inter Vivos Trust Accounts

On September 26, 2008, the FDIC issued interim final regulations entitled Deposit Insurance Regulations; Living Trust Accounts. The interim rules amend 12 CFR 330 were effective immediately.

The New regulations make it much easier to determine coverage when the bank has less than $500,000 under the trust and trustee's accounts:

The FDIC's main goal in implementing these revisions is to make the rules easier to understand and apply, without decreasing coverage currently available for revocable trust account owners.

This interim rule will result in faster deposit insurance determinations after depository institution closings and will help improve public confidence in the banking system. The rule eliminates the concept of qualifying beneficiaries and for account owners with revocable trust accounts totaling no more than $500,000, coverage will be determined without regard to the beneficial interest of each beneficiary in the trust.

Under the new rules, a trust account owner with up to five different beneficiaries named in all his or her revocable trust accounts at one FDIC-insured institution will be insured up to $100,000 per beneficiary. Revocable trust account owners with more than $500,000 and more than five different beneficiaries named in the trust(s) will be insured for the greater of either: $500,000 or the aggregate amount of all the beneficiaries' interests in the trust(s), limited to $100,000 per beneficiary.

October 13, 2008

Factors for Undue Influence in a Florida Will and Inter Vivos Transfers

In re Estate of Carpenter, 253 So. 2d 697 (Fla. 1971), the Florida Supreme Court stated to raise the presumption of undue influence, a plaintiff must show a confidential relationship between the donor and the donee and active procurement of the gift. Because courts have found that a confidential relationship exists in most relationships, the real issue comes down to active procurement of the gift. Recently Patrick Lannon wrote a summary of case law on the topic for the Florida Bar journal. Carpenter gives a list of seven factors of active procurement of a will, the:

1) presence of the beneficiary at the execution of the will;
2) presence of the beneficiary on those occasions when the testator expressed a desire to make a will;
3) recommendation by the beneficiary of an attorney to draw the will;
4) knowledge of the contents of the will by the beneficiary prior to execution;
5) giving of instructions on preparation of the will by the beneficiary to the attorney drawing the will;
6) securing of witnesses to the will by the beneficiary; and
7) safekeeping of the will by the beneficiary subsequent to execution.
In contrast with inter vivos transfers courts use a balancing test when evaluating the six recurring factors:
1) the donee's level of involvement in the donor's affairs;
2) the donee's level of involvement in the actual gift in question;
3) the relationship of the donee to the donor as compared to the natural objects of the donor's bounty;
4) the secrecy or openness of the transaction;
5) the effect of the transfer on the donor's pre-existing estate plan; and
6) the physical health and mental acuity of the donor at the time of the gift.
Generally it is much harder to undue a gift that takes place with a Florida Will than during the decedents life. These factors should be considered with making or planning to make transfers. With an understanding of how these issues are raised, it is possible to structure transfers so to avoid many of the factors of Undue Influence.

If you would like help in structuring transfers of property to help avoid the appearance of an improper transfer of property, Contact a Florida Will Attorney or a Florida Estate Planning Lawyer to review your case.

If you believe you have been harmed by the improper transfer of property, Contact a Florida Probate Litigation Attorney or a Florida Trust Litigation Lawyer to review your case.

Update:
Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.

October 7, 2008

How to Find a Florida Probate Attorney

How do you find a Florida probate Attorney?
It is important to look for an attorney within the state where the decedent was domiciled at the time of their death.

The type of lawyer that should be used will depend on what the case will involve.
If there is expected litigation, you should choose a Florida probate litigation attorney.

Depending on the type and amount of assets and creditors, it may be necessary to find a local attorney so that in court issues can be handled economically. Many probate courts will allow out of town attorneys to appear by telephone, but this should be checked prior to selecting an attorney who is far from the court. In other instances, the attorney can have a local lawyer help in hearings that require presence in the court.

Other types of probate cases are often dealt with by mail or in ex parte hearings and can be done by an attorney anywhere in the state.

To discuss what type of attorney you should look for please Contact a Florida Probate Lawyer.

October 6, 2008

Estate Settlement in Florida

Florida Estate Settlement is the process of gathering the assets of an estate and distributing them to the creditors and beneficiaries of the estate. In Florida this process is called a probate and generally requires the use of a Florida Probate Lawyer.

Most probate lawyers charge a percentage of the estate assets to handle the legal work involved. As Florida Estate Settlements get larger a percentage arrangement can become very expensive.

There is a wide range of fees charged for Florida Probate Administration and the Settlement of an estate. It is important to understand the nature and amount of assets and creditors to give a fair estimate of what a reasonable fee for a Florida probate should be.

Before you talk with a Florida Probate Attorney, you should gather as much information as possible. This will help them understand what steps will be necessary to administer the estate in question.