Articles Posted in Probate

In Florida, the assets of an estate can be transferred in three different ways upon the death of the estate owner. Some assets are transferred freely without a court’s approval by contractual terms. A court will also provide limited administration for an estate worth under $75,000. Finally, there is a formal administration for large estates without a valid will. A lengthy probate is not always necessary if the owner of the estate has a will that dictates how a person’s assets are to be distrusted upon his or her death.

Assets that Avoid Probate

There are some types of property that can be transferred to a new owner without a probate court’s approval. One of the most common types of non-probate property is property that is owned by multiple people in joint tenancy with rights of survivorship or as tenants by the entireties.  This property is usually owned by married couples such as a car or house.

Assets held in a trust may also avoid the probate process. The other type of asset that can bypass the probate process is an asset for which the person has designated a beneficiary. A good example of this is a payable on death bank account or life insurance proceeds.

Summary Administration

When a person dies with very few assets, the executor of the estate may use a summary administration. A summary administration is a much quicker process than the formal administration. A summary administration can be used in Florida if: (1) the death occurred more than 2 years ago, or; (2) the value of the probate estate, not including the non-probate assets, is not more than $75,000.00.

To start a summary administration,  the personal representative will file a petition for summary administration.  The petition must be formally served to the beneficiaries, if they did not sign or consent in writing with the petition, If there is no executor, and the court determines that the estate qualifies for summary administration, the court will simply issue an order to release the property to the beneficiaries.

Formal Administration

If the estate does not qualify for a summary administration, formal probate may be necessary. The probate proceeding will usually take place in the county where the deceased person was living at the time of his death. The law in Florida requires anyone who has possession of a will to file it with the local circuit court within 10 days of receiving notice of the death.

The court will then issue a Letters of Administration, which gives the executor the authority to settle the estate. If a will exists, it must be filed with the court and proven valid. Most likely the will be deemed “self-proving.” Under Florida law, a will is self-proving, if the witnesses sign the will in front of a notary public.

The executor will be responsible for gathering assets, paying debts and taxes, and distributing the assets to the beneficiaries. After the estate has been properly distributed, the executor files the receipts of his distribution with the court, and asks the estate to be closed. The court will then issue an order closing the estate and the executor will be relieved of his duties.

For more information on an estate is probated and how a will can prevent a lengthy probate process, contact the Law Office of David Goldman PLLC today at 904-685-1200.

Most people assume when they receive an inheritance, either through a will or a trust, that they must accept it. This is actually not the case as a beneficiary is also allowed to disclaim, or not to accept, the inheritance. Refusing an inheritance may seem like an alien concept, but can actually be the best course of action for many beneficiaries in some situations.

There are many reasons to disclaim an inheritance, with the most common reason being to avoid costly taxes. A common example of this might happen when parents leave money to affluent adult children. In this case, the children could disclaim the inheritance in order for the grandchildren to receive the inheritance instead. The money would then be taxed at the grandchildren’s tax rate rather the adult’s rate, which could save a large portion of the inheritance from being taxed. In addition, if the disclaimed assets would not be subject to the estate taxes of the parent.

Letting the inheritance pass to the next beneficiary through a disclaimer can be a much more efficient process compared to the beneficiary accepting the gift and passing the gift to the next beneficiary herself.   This is especially true if the gift is real property as is does not require the first beneficiary to go through the re-titling process. Someone with a large estate can also use a disclaimer to save on gift taxes, which will be incurred if the beneficiary takes the inheritance and passes it to another person.

A disclaimer can also be used for personal reasons, such as when a beneficiary knows another beneficiary needs the money more than she does. A good example of this occurs when a parent leaves her estate to two children, and names each child the alternative beneficiary.   In this scenario lets assume one child is a doctor and the other is a school teacher who supports a large family. The doctor may disclaim the inheritance so the schoolteacher receives her share of the inheritance because she knows the schoolteacher needs the money more.

In some cases there are restrictions on funds or assets that make them much more valuable to the children and a disclaimer can be used to remove the restrictions.

A beneficiary may wish to disclaim an inheritance if she is facing bankruptcy. In Florida, the bankruptcy law is complicated and may not allow a beneficiary to become a disclaimant.   We recommend consulting with a bankruptcy attorney before disclaiming an inheritance in order to avoid any fraudulent transfers of assets.

Beneficiaries often disclaim property that has become undesirable. A property might become undesirable for many reasons such as when extensive repairs are needed, or the property has incurred large debts.   It might often cost the beneficiary more to use or sell the property, and in taxes, than it would be worth. A disclaimer would allow the property to go to another beneficiary or back to the settlor’s estate.

All disclaimers should be done according to the Internal Revenue Code § 2518 to be valid, and should be prepared by an experienced estate-planning attorney. For more information, contact The Law Office of David Goldman at 904- 685-1200.

A common estate-planning problem arises when parents with young children die or become incapacitated. Usually when one parent dies, the second parent assumes custody, but if the second parent is also not available the issue is who has the right to and who will raise the minor children.

The best solution to avoid this issue is to plan ahead by naming a guardian through a will. A guardian should be someone who is willing to raise the minor children in the event something happens to the parents. To qualify as a guardian in Florida, the person must be at least 18 years old and of sound mind.

In the will, a personal guardian should be named for each of the parent’s children. It is also a good idea to name an alternative guardian in the event the first guardian is unable to serve. Besides the age requirement, a guardian must be a Florida resident unless a close blood relative or spouse of one. A testator, or one who executes a will, may also name co-guardians if they prefer that two people care for the child. This could allow another couple to raise the children, and would give each guardian the ability to make important decisions for the child.

The parents can select one guardian to raise the child, and another to take care of their property.

Selecting a guardian is not a process that should be taken lightly and there are many factors we urge clients to consider before naming a guardian in the will. The most important factor is whether the prospective guardian has a genuine desire to care for the children. A parent should have an honest discussion with the guardian to determine if this person is fully prepared to take on this big responsibility.

Even if the guardian is 100 percent on board with the idea, we urge clients to weigh other factors as well, such as if the prospective guardian is physically capable of raising the children. A parent might also want to consider how much time the guardian has to be a parent, and whether the guardian would be able to afford raising the children.   The latter factor may also depend on if the parent can leave the guardian any assets to help. A parent might also wish to factor whether the guardian already has children, and if their children would need to move out of state.

The majority of the time, parents will wish for their children to stay together with one guardian. However, it is possible for different guardians to be appointed for different children. This might be a good idea if children have become attached to different adults within the extended family. For instance, the older child may like spending the majority of her time with the grandmother, while the other child may prefer an uncle. This situation arises most commonly when a parent has children from different marriages.

If one parent dies, the default rule in most jurisdictions is that the other parent will retain custody of the child.   This will happen unless the other parent has legally abandoned the child or the parent is deemed unfit by a judge. It is often difficult to prove a parent is unfit, however, courts may rule a parent to be unfit if they have a serious problem such as habitual drug or alcohol abuse, a mental illness, or a history of child abuse.

For more information on how to name a guardian through a will, contact Florida estate-planning attorney David Goldman at 904-685-1200.

A will is an important tool in the estate planning process that allows a testator, a person who creates a will, to distribute the assets of an estate in the manner is deemed most appropriate. If no will is present, a testator’s estate is executed by the rules of intestate succession and assets are distrusted to the testator’s predetermined beneficiaries at a certain percentage.

To create a valid will, Florida requires the testator to posses the intent to create a will. To make a will, Florida requires the testator to be of sound mind and at least 18 years old. Additionally, a court requires the testator to understand the extent of her property, and to know the nature and scope of the act of executing a will. The testator must also be able to sign the will with this intent.

Courts do not allow a will to be signed by a power of attorney, guardian, or conservator of the testator.

Often people do not think someone is competent, but they may still be able to execute a will. There is a difference between a court determining someone to be incompetent and a doctor saying it.

In Florida, case law has shown that even if a testator is deemed incapacitated, it can still execute a Will without a guardian. Generally, an incapacitated person does not have the testamentary capability to execute a will.   It must be proved that the testator returned to a state of testamentary capacity by demonstrating that the will was executed during a lucid moment. A “lucid moment” is a period of time during which the testator returned to a state of comprehension and possessed actual testamentary capacity.

If a will was executed while determined to be incapacitated by a court, the burden of proof lies with the proponent of the will, which means those who wish for the will to be executed must present some evidence that the testator was lucid and possessed the proper intent to execute the will. In Am. Red Cross v. Estate of Haynsworth, the proponents of the will provided two expert witnesses that stated they believed the testator to be lucid when the will was executed. However, only one of the witnesses had examined Mr. Haynsworth and the other had not examined him near the time he signed the will. The court did not buy the proponent’s argument because neither of the expert witnesses, or lay testimony, offered any evidence that Haynsworth was lucid near the time the will was executed.

Therefore, the proponents of a will should have the incapacitated testator examined by an expert or the will could be deemed invalid by a court. The court in Haysworth did not further define how near the examination by the expert should take place in regards to when the will is executed. The best course of action would be to have the testator examined by a physician and psychiatrist on the same date the will is executed, and to then seek a judicial determination of competence by the court.

For more information on how to execute a will, or the effects of an incapacitation in estate planning, contact The Law Office of David M. Goldman PLLC at 904-685-1200.

The estate executor or personal representative is one of the most important roles in managing a loved one’s estate after death.   Serving as an executor comes with many responsibilities, but knowing what to expect will make the transition into this important role much easier. The following checklist can be helpful in organizing your efforts.

The first step an executor should take is to look for records and important documents that relate to the deceased’s estate.

The common places to look for records

  • Personal filing cabinets: Many people keep physical copies of financial records in a home filing cabinet, safe, or in other types of physical storage. Financial records might also be kept near areas where bills are paid in the home.
  • Electronic storage: Search through the deceased’s home computer, laptops, and other electronic devices for folder names that might relate to the estate. A good place to look on a computer include the “my documents” and “downloads” folders on PC or Mac.   Important files are often times kept in storage devices such as an external hard drive or USB thumb drive.
  • Mail: Look for correspondence from banks and other investment companies. These institutions will periodically send financial statements or even checks.

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If you live in Florida and own property in another state an ancillary administration will be necessary upon the death of the owner(s) of that property. This special probate administration will be in addition to the administration you have where you lived. This is required because real estate or real property is treated differently than personal property.

There are several ways to avoid the additional administration:

  1. The real estate could be owned in a business entity. This converts the ownership from one of the real estate to one of a personal property interest in the stock or membership of the business entity.
  2. The real estate could be owned in a trust. Because the trust survives you, the trust will distribute the property according to the terms of the trust. The trust can also be used for other property and may even enable you to avoid the probate of your entire estate.
  3. The real estate could be retitled using a ladybird or enhanced life estate deed. This special type of deed, available in some states, is very similar to a deed with a beneficiary designation.

Florida’s statutory probate fees apply for an ancillary administration like other forms of probate in Florida. The legal fees start at $1500 and are typically 3% or less for the first million dollars of value. If your property is located in another state, the fees may not be as reasonable as they are in Florida.

We would be happy to discuss your specific situation and help you determine if a business entity, trust, or enhanced life estate deed could benefit your family and help to avoid the costs and delays invovled with probate. Note: some methods of avoiding probate can protect assets from creditors of your and your estate.

Most Florida probate courts simply accept the information contained in the pleadings that are filed with the court. These pleadings are usually signed “under penalties of perjury”.

Some courts (such as Citrus Count and Miami-Dade County) often require an Affidavit of Heirs.pdf to be filed along with the pleadings. There really is no other independent evidence that is required to prove who the beneficiaries are.

When a rightful heir has been omitted from the pleadings, it is important to act timely. Sometimes, there are people who are included that should not receive a ​portion of the estate.

If anyone (most likely one of the heirs) contests the proposed distribution of assets by claiming that one or more of the alleged heirs are not heirs at all, there will be an evidentiary hearing where the disputed heirs will need to prove they are heirs. (A Birth certificate is a good start on this).

Generally, the Affidavit of heirs contains information on the spouse, children of the decedent, the surviving spouse, children of the surviving spouse, parents, siblings, grandparents, aunts, and uncles.

Portland company WebCease is making waves in the probate and estate-planning community by helping attorneys and grieving families locate the deceased’s digital accounts.

CEO Glenn Williamson aims to be the first to provide this service to the growing market of families and attorneys trying to track down digital accounts. Williamson is banking on the need for this service to continue to grow as people continue to use digital accounts for shopping, social media and traveling.

WebCease searches across different vendors to determine if the deceased person had an account. WebCease then generates a report that outlines the location of the deceased’s accounts and includes instructions on how to transfer the account or shut it down. The company will not take any action to use the account, or attempt to login to the account.

For example, if a person has accrued points with Delta Airlines or Marriott Hotels, Webcease will find the account and alert the interested party as to what further steps and documents are needed to use the points. Williamson hopes the company’s services will help to save time for grieving families and reduce the possibility of identify theft.

Williamson first came up with the idea while visiting his LinkedIn page. The networking site suggested he connect with two people he knew had passed away. The idea further took root when Williamson’s mother died, and he himself had to search for her digital accounts. He documented these steps and realized the immense amount of time and work it took to track down these accounts.

It took him more than 20 hours or searching and researching the various companies’ terms of service. He eventually found his mom had 13 online accounts. This search allowed him to find more than 50,000 miles through United Airlines, which could be transferred or donated to another account.

Currently, about 60 percent of the process is automated. The rest of the work required the company to hire a team of researchers to compile the report. Williamson plans to hire six employees throughout the year. So far the company has targeted its service to probate attorneys and other estate-planning professionals. A full report costs $529, but the company is releasing a $99 pared-down version for consumers.

WebCease focuses on companies and websites with monetary value, such as travel sites, shopping websites, and social media sites that could hold sensitive information about the deceased person. Currently WebCease searches through about 70 websites and plans to add more as the company grows.

WebCease is a inventive solution for those who have not included their digital accounts in their estate-planning materials. According to Williamson, only 50 percent of Americans have a will and 90 percent don’t include digital assets in the will. For more information on Webcease or including digital information in your estate-planning materials contact the Law Office of David Goldman today at 904-685-1200.

Many people see joint accounts as a cheap and easy way to avoid probate, since joint property passes to the join owner at death, but these accounts can actually be quite risky when it comes to estate planning.

Joint ownership of accounts can be a great way to easily pass assets to another owner at death. Joint ownership is also a great way to plan for an elder person’s incapacity, since the joint owner of the account can pay bills and manage investments if the primary owner falls ill or suffers from any other sickness.

There are some potential downsides to joint ownership of an account. The biggest factor to consider is the risk of joint ownership. Joint owners have complete access to the account, and the ability to use the account funds for any purpose. When children are made joint owners of an account, it is often the case they can take money without consulting with the other children.

Another risk involved with joint ownership accounts is that the funds of the account are available to all creditors of all the joint owners of the account. There is one type of joint ownership called tenants by the entireties that does not have this risk for assets in Florida. In addition, joint ownership of an account can also serve as a roadblock to receiving financial aid or health benefits.

Joint ownership of accounts can also cause some heirs to receive more inheritance than others. An example would be if a child is named a joint owner of the account. At the death of the original owner, that child could receive more than the other children. While the original account owner can hope the children will share the funds from the account equally, there is no guarantee the other joint owner will distribute the money equally.

A system based on joint account ownership can also fail if the joint owner passes away before the original owner. If a child is the joint owner and passes, the child’s loved ones may not receive the benefit of those funds. For instance, if a mother places an account in the name of her child and herself with rights of survivorship and the child dies before the mother, the assets in that account will go to the mother’s heirs and not to the daughter’s heirs.

Joint accounts are best used in limited situations. One situation to possibly use a joint ownership account is when a senior has just one child and wants to pass everything to the child. Generally an estate planning trust can provide better protections for the unexpected than joint ownership or a beneficiary designation. There are risks involved with joint ownership and tax issues, so you should consult an estate-planning attorney before relying on joint ownership.

Another way a joint account can be useful is to include children on a person’s checking account to help pay monthly bills. This checking account should be a smaller account that does not include the bulk of the original owner’s assets.

Instead of taking a risk with joint ownership accounts, we recommend using more reliable estate-planning tools such as durable power of attorney to provide the ability to pay bills or help with financial decisions. These tools can limit the risk of loss by eliminating your agent’s creditors from those who can access your funds.

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