Recently in Estate Planning Category

October 29, 2014

Revocable Trusts and Asset Protection

Many times we get questions from clients asking if their revocable trust provides asset protection from creditors. The answer to this is the typical legal answer "It Depends". That is it depends on who owes the money. In Florida a revocable trust can provide some limited protection against the creditors of your beneficiaries through a spendthrift clause, but it will not provide protection from the creditors of the person who creates the trust. Upon your death, the assets in your revocable trust are available to your creditors.

There is a new type of irrevocable trust that is similar to a revocable trust in terms of management, control, and no negative tax effects. This special irrevocable trust is called an IPUG and can be structured to provide asset protection for the items placed in the trust.

An IPUG can be designed to protect an entire asset, the principal, or the income from the asset. The most common design is to protect the entire assets. If you are concerned about protecting your assets from future creditors and the creditors of your children, an IPUG may be the right choice for you.

More articles on what an IPUG is and the benefits of using an IPUG trust.

August 14, 2014

Do I need to go through a lawyer to make a will in Florida or can I use a website like legalzoom?

You can use a website or create your own will in Florida, but we find that some people do not create valid wills, or create wills that do things other than what they want. We only charge $200 for a will so an online will does not save very much considering the risks.

If you want to create your own will be sure that you sign the will at the end and in front of two witnesses. There are benefits to using a self proving affidavit, but one is not required under Florida law. Of course, most lawyers will include a self proving affidavit with the will that they prepare for you.

Many online wills or wills that individuals try to create do not include provisions for things that happen routinely. Some examples are a named person dies simultaneously, shortly after you, or before you. An improperly drafted will could expose your belongings to their creditors in such a case.
Another common example is that a will could leave money to someone who ends up being disqualified for government benefits because of the inheritance.

Your will could leave a large amount of money to a young adult, who is not financially responsible yet.

Your will could leave money to someone who is bankrupt or files for bankruptcy shortly after you die and their inheritance could be lost.

There are many reasons to hire a Florida estate planning lawyer to create a valid will in Florida that deals with your specific circumstances, but also many reasons like the ones mentioned above that most people never consider.

July 29, 2014

Dangers of Relying on Joint Accounts for Estate Planning in Florida

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.

July 28, 2014

Banker Suicides indicate Stress of the Profession.

If your family works in a high stress profession is a good idea to make sure you and your family keep their estate plans up to date.

The unexpected deaths of finance workers in the past few months by suicide around the world have raised concerns about mental health and stress levels of the banking profession.

JP Morgan executive director Julian Knott, 45, killed himself after shooting his wife Alita Knott, 49, to death with a shotgun. Julian worked for JP Morgan until July 2010, before he and his wife moved to the United States. Before the move, Alita had opened a nursery in Southwick, West Sussex and remained the nursery's care provider until 2013.

Police officials in London are currently investigating two suicides of finance workers. William Broeksmit, 58, was a retired risk executive at Deutsche Bank. Broeksmit died on Jan 26, 2014 at his home in west London, where Police found him hanging. Gabriel Magee was a 39-year-old vice president at JP Morgan who died after falling from his firm's 33-story building. A few weeks later, Li Junjie, a 33-year-old banker at JP Morgan in Hong Kong, jumped from his firm's local headquarters as well.

The banking world's aggressive, hard-working culture may be too much for some to handle. Peter Rogers says banks are beginning to realize the scale of the problem. Rodgers believes the banking sector needs to see a number of initiatives to improve staff well being and hopefully a cultural shift will occur within the firms.

Emma Mamo, who leads a workplace initiative in the U.K. said finance does have a long-hours culture. "People can't keep doing long hours; you need perspective and downtime," she warned.

America has also seen a recent trend of banking suicides. Mike Dueker, a 50-year-old chief economist of a US investment bank was found dead recently near the Tacoma Narrows Bridge in Washington State. Richard Talley, 57, was the founder of American Title Services in Colorado. He was found dead earlier this month after allegedly shooting himself with a nail gun.

On January 10, Bank of America issued a statement to employees telling them they should take some weekends off. Christian Meissner, head of global corporate and investment banking at Bank of America said analysts and associates should "take a minimum of four weekend days off per month."

JP Morgan is not a member of the City Mental Health Alliance and has announced any measures to deal with the alarming increase of employee suicides.

Carolyn Wolf, executive partner and director of mental health law practice at Abrams, Fensterman, suggests the trend may be tied to substance abuse. She thinks many young people get hooked on drugs such as Adderall to cope with the long hours. Many take the drug, prescribed for ADHD, to stay focused during a long workday. However, she says the substance abuse can exacerbate underlying mental health issues.

Suicide statistics show that financial professionals have a 39 percent higher likelihood of suicide than professions within the general public. In 2010, more than 38,000 Americans died by suicide, according to the Center for Disease Control.

July 18, 2014

Probate: Is it a good idea to give your heirs their inheritance while you are still alive?

Planning an estate can be a difficult process, but also a rewarding one because it helps to ensure that a person's heirs will be provided for after he or she dies. Many assume they should wait until after death to convey assets to their loved ones, but there are some benefits to giving assets to an heir while still alive.

There are two types of taxes to consider when determining when to give an heir your assets. A decedent who gives his or her assets to someone while still alive may have to pay a gift tax. This is a tax imposed by the federal government on any transfer of property. Property includes intangible items such as cash and stocks, as well as physical items such as vehicles or furniture.

The most important aspect of gift tax to understand is the unified gift and estate tax credit, which allows a person to give property tax free up to $5.34 million throughout his or her life.

According to current tax law, a person is allowed to give a tax-free gift worth up to $14,000 per recipient each year. This $14,000 is not counted against the lifetime exception. Any amount given to one recipient over $14,000 would count against this total. So this means if a person is given $18,000, then $4,000 would be deducted from the lifetime total and reported with a federal gift tax return.

When a person dies, an estate tax is imposed by the federal govern on the decedent's estate after the property transfers to his or her heirs. This tax is calculated by the decedent's "gross estate," which includes all of his or her assets such as real estate, cash, and business interests. The net amount of these calculations are then added to any taxable gifts given by the decedent with a value large enough to deduct from the decedent's unified credit.

These laws mean that giving heirs some inheritance now can actually be a good way of avoiding higher estate taxes. However, this is only beneficial to the gift giver if he or she avoids the gift tax by giving something with a value less than $14,000 per heir. If the gift giver is married, and gives the gift jointly with his or spouse, this gift will avoid the tax if its value is under $28,000.

There are other advantages to giving gifts while alive, which includes the benefit of seeing the heir actually enjoy the gift. This allows the gift giver to also advise the heir on how to use the gift. If the heir misuses the property against the decedent's wishes, he or she can stop giving that person money and adjust the will accordingly.

There are also some good reasons to hold off on giving an heir their inheritance early. The biggest reason is the decedent may need that property or money while they are still alive. The financial climate can change between now and when the estate owner dies. A person who gives too many assets away may find they now need them in order to survive. A final reason to wait to give assets until after death is it allows the heirs to grow and mature first before receiving the gifts. This can ensure the inheritance is both more appreciated and used more wisely.

For more information on estate planning, contact Florida estate planning and probate attorney David Goldman at (904) 685-1200.

July 15, 2014

Estate Planning: The Risk of Creating Your Own Will. Is it valid?

will and testament.bmpThe Florida Supreme Court recently decided the long and costly case of a deceased woman who tried to write her own Will using an online legal form.

In Aldrich, v. Basile, Ann Aldrich used a pre-printed legal form to draft a Will. She did this most likely to avoid paying an estate-planning attorney. This Florida Supreme Court Decision resulted in costly legal fees and most likely years of anguish for her family.

Deciding who would inherit Ann Aldrich's property was appealed twice, which was finally decided by the Florida Supreme Court. The court's decision of who would inherit the property was most likely not what the deceased had intended. Justice Pariente wrote in her concurring opinion the result of the court's decision came not from the interpretation of Florida law but from Ann's mistake of using an online form that did not adequately express her specific needs.

Ann Aldrich handwrote her Will using an E-Z legal form. In this document she wrote specific directions for her house and its contents, her life insurance policy, her car, and her bank accounts to pass to her sister Mary Jane Eaton. She even took a further precaution by writing in her Will that if her sister died before her, the above-mentioned assets would pass to her brother James Aldrich.

Tragically, her Will failed to include a residuary clause to address any other property she might own at death. Her sister died three years later after Ann drafted her Will. Her sister left her cash and real estate, which Ann deposited into an account with Fidelity Investments.

Ann Aldrich passed away 2 years later and had never revised her Will to include the additional assets she acquired from her sister's estate. Since her Will did not include a residuary clause, a dispute arose within the family regarding who should actually inherit the property Ann received from her sister. James Aldrich, the brother, believed he should receive these assets, like the other property described within the Will. The other heirs, two nieces, believed the property should be considered intestate property. Intestate property is property distributed to the deceased's heirs according to state law, because the property was not accounted for in a Will. If the property were intestate, then the nieces would receive a significant portion of the assets.

Ann did attempt to draft an amendment to her Will in 2008. The amendment stated that since her sister died, she wished to reiterate that all her worldly possessions should pass to her brother. However, the note only had one other signature, and thus the amendment was not valid under Florida law.

The trial court originally found in favor of James Aldrich, but the nieces appeal and won. The Florida Supreme Court agreed with the appeals court, ruling Ann's 2008 amendment to be extrinsic evidence because the amendment was not properly drafted. When looking at a Will, the Court shies away from trying to guess the intent of the deceased who drafted the bill, and instead will only consider the concrete language of the document. Therefore, any assets not specifically included in Ann's Will would have to pass to her heirs according to Florida's intestate laws.

This court case serves as a reminder of the risks involved with estate planning. We recommend hiring an experienced estate planning attorney to draft your Will and to ensure your heirs are properly taken care of.

June 25, 2014

Should I use a UGMA, UTMA, 529, or Trust?

Estate Planning:

There are a number of ways to save money for a family's children that will release the money to them at an early age in their life.

The two most popular options are either through the Uniform Gift to Minors Act (UGMA) or through the Uniform Transfer to Minors Act (UTMA). Both of these were created with a similar goal, to save money for children to use when they become legal adults. While the acts are similar, both have specific nuances that must be taken into account.

Under both acts, a grandparent or a parent usually serves as the custodian for the child. This person is usually whoever has legal custody of the child. The custodian is the person who donates funds into the account and also manages it. A custodian must be someone who is a US citizen and is currently in a financially sound position. Additionally, any other adult can invest in these accounts on behalf of a minor.

Both of these accounts are taxed to the minor beneficiary for the account's interest and dividends. The custodian can withdraw from this account at any time without any restrictions so long as the money is used to benefit the child in some way. This rule is not strictly enforced, and as an example may allow a parent to buy a car the child can use when he or she turns 16. This gives a custodial account an edge over 529 plans or other education savings accounts because it allows the custodian to withdraw the money. However, a custodian is not allowed to close the account.

The two types of accounts do differ in some key ways. In Florida, the termination age for a UGMA trust is 18 years, while the termination age for a UTMA trust is 21 years. The termination age for both of these acts differ by state so it is important to consult an attorney who is familiar with the state's law.

Another way the accounts differ is in the type of assets that can be held in the account. The UGMA account is limited to gifts and transfers to bank deposits, securities, mutual funds, and insurance polices. A UTMA account is not as restricted, and allows the transfer of any kind of asset including real estate.

One difference between a custodial account and educational savings plan is how they are taxed. UGMA and UTMA accounts are taxed as ordinary income and are not tax free like an ESA or 529 plan. Once the child turns 14, both the income and capital gains in the custodial accounts will be taxed at the child's rate.

The good news is there is some tax relief for children under 14. The first $950 deposited into a custodial account is tax-free. The next $950 is taxed at a child's rate, and any additional funds are taxed at the parent's rate.

Parents who want to use a custodial account to save for a child's education should note the child is not required to use these funds for college. Once the child takes control of the account, the child may use the money for any purpose they desire. Children who start college before the account termination may still use the account's funds for tuition as long as the custodian consents.

UGMA and UTMA accounts do not provide the same level of asset protection or flexibility that a trust can provide. Often parents and grandparents use a combination of

June 23, 2014

You Thought the IRA was Protected From Your Kid's Creditors!

Last week, The Supreme Court unanimously ruled that the funds contained in an IRA are not protected from creditors after bankruptcy.

You may need to reevaluate how your estate plan deals with your IRA. If your beneficiaries live in Florida, this may not be a concern because the Florida Legislature has an IRA exemption statute which includes inherited IRAs. As it is difficult to predict where your beneficiaries will live at the time of your death, you may not be able to count on the Florida statutes to protect your beneficiaries.

We have recommended to make an asset protection trust the beneficiary of your trust to protect from the retirement funds from the loss that could be associated with creditors of our client's beneficiaries (typically their spouse or children). Many have not seen the need for this and as a result, there may be many families using traditional beneficiary designations which place their retirement funds at risk.

Attorney and U.S. Bankruptcy Trustee William Rameker won a landmark case in Clark v. Rameker last week that will fundamentally change bankruptcy law. The Supreme Court Justices held funds contained in an IRA, which were inherited by Heidi Heffron-Clark after her mother died, did not qualify as retirement funds.

The general rule in bankruptcy law is an IRA held by the original owner is considered a retirement fund and is exempt from creditors. Before this case, there was a gray area in the law upon how to treat a non-spousal inherited IRA. This ruling has cleared up the confusion. Now these funds are no longer protected by the retirement exemption.

The court reasoned inherited IRAs do not operate like ordinary IRA's. Unlike a traditional IRA, a person who inherits an IRA can withdraw funds from it at any time. The owner of an inherited IRA must actually withdraw all the funds or else be required to take minimum distributions on an annual basis. Additionally, the owner of an inherited IRA can never make contributions to the IRA.

Clark inherited the IRA after her mother died in 2001. When she first received the IRA it was worth over $450,000. She took monthly installments from this IRA until 2010, when she and her husband filed for Chapter 7 bankruptcy.

Rameker argued Clark's inherited IRA, now worth $300,000, was not exempt from creditors under 11 U.S.C. § 522(b)(3)(C) because the funds in an inherited IRA are not "retirement funds." The Bankruptcy Court agreed with Rameker, but was overturned by the District Court, which felt the law protected any funds that were originally accumulated for retirement purposes.

The District Court was then overturned by the Seventh Circuit Court, who held the differences between an IRA and an inherited IRA were fundamentally different. The most important difference to the Court was that an inherited IRA "represent[s] an opportunity for current consumption, not a fund of retirement savings."

The Supreme Court agreed and found there was three legal characteristics that lead the Court to conclude funds held in inherited IRAs are not set aside for the purpose of retirement. These reasons included the IRA holder's inability to invest more money into the account, and the law that requires the holder to withdraw the funds no matter how far from retirement the holder may be.

The Supreme Court reasoned the IRA holder's ability to withdraw 100 percent of the funds from the IRA at any time without penalty was too dissimilar from a traditional IRA. In a traditional IRA, the holder is penalized a 10 percent tax penalty if he or she withdraws any funds before the age of 59.

How this holding will affect bankruptcy law is unclear as there is now a risk that IRA money left to heirs will no longer be protected from creditors if the beneficiary is in financial trouble. However, in Florida these inherited IRA's may still be protected from creditors by state law.

Bankruptcy law is constantly changing, and therefore it is important to consult an experienced estate-planning attorney to ensure your estate is secure for your heirs. For more information on IRAs and estate planning, contact Florida attorney David Goldman at (904) 685-1200.

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June 19, 2014

Probate: Do Stepchildren Inherit from the Will like Biological children do?

In today's world, it is common to see blended families full of biological and stepchildren. It is crucial for parents, who wish to leave an inheritance to their stepchildren, make a will or trust because stepchildren do not have the same inheritance rights as biological children.

Florida's probate laws do not treat stepchildren as a person's legal heir, which means stepchildren do not have an automatic right to inherit from their stepparents. Remember that your children may be the stepchildren of your spouse, and depending on who lives longer may be unintentionally disinherited.

This does not mean that stepchildren cannot be included in the will. To ensure a step-child can inherit from the estate, he or she must be specifically named as a beneficiary.

If the stepchild is not specifically named he or she might not inherit anything. For example, a will that states, "I leave 40 percent of my estate to my children," would only transfer assets to the biological children. This statement would only include a stepchild who has been legally adopted (which would not be a stepchild).

In Florida, a child is a person who is legally adopted or the natural child of the decedent. If the will is found to be ambiguous, a court may try to interpret the intent of the deceased by looking to the plain language of the will. Any general statement found in a will referring to children, will be assumed to mean only biological children unless defined otherwise.

If a person dies without a will, stepchildren will not receive any inheritance under Florida's intestate succession law. This law states that if there is no spouse, the estate would first descend to the biological and adopted children of the decedent. When there is no descendant, the property passes to the parents, and if that is not possible, then the property passes to the decedent's siblings. If the decedent has no heirs, then the property would go to the state.

Another issue may arise for children born out of wedlock. There is no issue if the parent includes this child in the will. However, there is an issue if the parent has died and the child needs proof he or she is related to the parent.

This is more often an issue when the child wishes to inherit from the father. If the father is alive, then a paternity test is usually performed to determine if the child is a descendant. This becomes more difficult to prove when the father is dead. In this scenario, a child's best hope is that an autopsy was performed. Then it could be possible to obtain DNA samples from the father's tissues in order to perform the paternity test.

Under Florida law, the intent to include children in a will must be made clear within the language of the document. This is why it is crucial the will be drafted by an estate planning attorney. An experienced attorney can ensure the intent of the will, and the identity of the will's recipients, are made clear to the court upon the decedent's death.

For more information on how to include your stepchildren in the will, contact Jacksonville Estate Planning attorney David Goldman today for a free consultation at 904-685-1200.

June 12, 2014

Florida Probate Law: The Risks of Avoiding Probate Through Changing Ownership

Probate is the system the court uses to administer a person's estate, either through a will or through intestate succession. Clients often ask for ways to avoid the probate process, such as adding a child to their bank account or adding the child's name to the deed.

Adding a Child to a Bank Account

In most cases, adding a child to your bank account is not a good idea. A parent who adds a child to his or her bank account, may interfere with the will, and could put the account's funds at risk.

Generally, a power of attorney is the best way to manage a loved one's assets. A power of attorney is a superior way to handle these assets because it gives far more expansive control to the child over the parent's assets, but requires the child to act as a fiduciary to the parent. A power of attorney can allow a child to manage all assets in the parent's bank account. Additionally, a power of attorney can allow the child to become an agent to call insurance companies in order to settle disputes, and to enter and break contracts on behalf of the parent.

There are many risks involved with adding a child to the account. If the child has creditors or becomes subject to a judgment, those assets can be used to pay the amount owed by the child.

If another person is added to the account, the bank will give both parties full access to the funds within the account. This means the child would be allowed to withdraw funds whenever he or she wanted without restriction. While many parents may think this may never happen, we see it all the time.

Additionally, all the funds in this account would pass outside the probate process. However, if there is a will, the child is not legally obligated to distribute those funds in accordance to the will. These funds would also not pass to other heirs in accordance with Florida's intestate laws.

There may also be gift tax costs for adding someone's name to an account other than a spouse. Besides this cost, when the child is added to the account a gift of up to 50% of the account value takes place. This can cause gift tax returns to be filed with the IRS. There are limits on yearly and lifetime tax-free gifts, which could mean much of the account is subject to taxation. This situation can also be avoided by giving the child a power of attorney. In addition, this gift could disqualify the parent from nursing home coverage if it occurs within 5 years of needing coverage.

Adding a child to a Deed

Adding a child to a deed is also a bad idea for many of the same reasons. This is usually done in Florida by a life estate deed. This document would give the parent a present interest in the property and the child a future interest.

In this situation, a parent would retain the present right to live in the home. This right would last as long as the parent, or their spouse, is alive. During this time, the child retains a future interest in the home. This means as soon as the parent dies, the child becomes the owner and possessor of the home.

This situation creates some potential problems because the courts view a life estate deed as a gift to the child. This means the parents could lose a step up in tax basis for the children, face penalties and taxes for failure to perform gift tax returns, and lose eligibility for nursing home coverage.

A child's future interest can also be at risk to creditors and become subject to a judgment. While a future interest may not appear to have a money value on the surface, courts often allow the value of a future interest to be determined based on certain tables. These tables determine a future interest's value by incorporating factors such as the age of the parent, their life expectancy, and the current interest rates.

There are ways of avoiding probate, but doing so without the guidance of an experienced Florida Estate Planning attorney can put your family and assets at risk. For more information on how to plan your estate and power of attorney in Florida, contact Jacksonville estate planning attorney David Goldman at 904-875-1200.

June 11, 2014

Probate Law: Can a minor child be disinherited in Florida?

There are many situations where a parent may wish to disinherit a child, such as when the parent has been estranged from the child for years. Clients often wonder if they are obligated to leave assets to their children or if they are allowed to disinherit them completely.

Florida's constitution protects the rights of minor children through homestead laws, which prohibit the head of the household from leaving his or her residence to anyone other than a spouse or minor child. Under this law, a surviving spouse is given use of the property for the remainder of his or her life, this is known legally as a life estate, and then the home passes to the minor children. Recently a surviving spouse has been given the option of taking 50% of the interest in the home or the life estate. The homestead law only applies to children who were minors at the time of the death.

If a person dies without a will, any property that person owned during his or her life will pass under Florida's intestate succession law. Intestate succession is a law that regulates the decedent's estate for the remaining heirs. The part of the intestate estate that does not pass to the surviving spouse, or the entire estate if there is no surviving spouse, is given to the children of the decedent. This means that without a will, a person's children will receive part of their estate without the decedent's consent.

Pretermitted children can also inherit part of their parent's estate. A pretermitted heir is a person who is likely to inherit under a will, except that the person who wrote the will did not know of the child's existence at the time the will was written or the child was born after the will was written. This child will receive a share of the estate equal in value to what the other children would have received if the testator had died intestate. This means an unknown child, if not mentioned in a will, could potentially receive a larger portion of the inheritance than other known children.

Many clients mistakenly believe they are obligated to leave a child a nominal inheritance, such as a dollar. If a parent wishes to intentionally disinherit a child in Florida, they are typically better to leave the child nothing. Under Florida law, any person included as a beneficiary in a will becomes an interested party and are entitled to notice of the probate. This means that person must sign all consents, receipts and waivers regarding the estate.

There are some alternatives to disinheritance. One such alternative would be to establish a trust for the child, which would allow a trustee to control the trust property and give the heir an allowance or other stipulations. For instance, a decedent could create a trust that requires the heir to attend rehab and be regularly drug tested.

If a decedent does intend to disinherit either a child, it should be expressly stated in the will. Otherwise, a court could interpret the omission to be a mistake or a failure to update the will. Wills should be drafted by an estate planning attorney, who can discuss your objectives and make recommendations as to the options available to convey property to the ones who matter most.

For more information on child disinheritance and estate planning in Florida, contact Jacksonville attorney David Goldman at 904- 685-1200. Also, feel free to email us to receive a confidential estate planning questionnaire.

October 24, 2013

Improper gift to a lawyer in a will or other estate instrument void

New Florida Statutes §732.806, which is effective October 1, 2013, makes an improper gift to a lawyer in a will or other estate instrument void.

The new statutory provision is here: http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0700-0799/0732/Sections/0732.806.html

The new Florida statute in effect tracks 4-1.8(c), Rules Regulating The Florida Bar and incorporates it into the probate code, and makes a violation of the statute a basis for voiding any part of a will, trust or other written instrument which makes an improper client gift to the drafting lawyer or a person related to the lawyer. The statute also provides exceptions to this prohibition, including gifts where the lawyer or other person is related to the person making the gift as well as title to property acquired for value from a person who receives the property which violated the statute.

The previous (common law) rule in Florida probate was that gifts made to lawyers in violation of Bar Rule 4-1.8(c) were not automatically void; however, the gifts created a rebuttable presumption of undue influence by the drafting lawyer.

F.S. §732.806(1) states:.

732.806 Gifts to lawyers and other disqualified persons.-- Section (1) Any part of a written instrument which makes a gift to a lawyer or a person related to the lawyer is void if the lawyer prepared or supervised the execution of the written instrument ( a will, a trust, a deed, a document exercising a power of appointment, or a beneficiary designation under a life insurance contract or any other contractual arrangement that creates an ownership interest or permits the naming of a beneficiary.), or solicited the gift, unless the lawyer or other recipient of the gift is related to the person making the gift.

F.S. §732.806(7)(a) further states in section (7) For purposes of this section: (a) A lawyer is deemed to have prepared, or supervised the execution of, a written instrument if the preparation, or supervision of the execution, of the written instrument was performed by an employee or lawyer employed by the same firm as the lawyer.

As of this month (October 1, 2013), improper client gifts made by a lawyer to him or herself in a testamentary instrument are now void as a matter of law.

October 19, 2013

How to Create a Living Will in Florida

Life is full of instances where taking a decision seems to be extremely challenging. The task is even more difficult if the decision concerns the medical treatment for a loved one that is incapable of deciding for him or her self. Deciding health care matters for patients that cannot do so is emotionally wrenching for families and represents an ethical dilemma for physicians. This difficult scenario is better illustrated with the Terri Schiavo case.

Terry Schiavo Sad Case.

Ms. Schiavo was sustained by artificial hydration and nutrition through a feeding tube for 15 years after suffering a cardiac arrest, triggered by extreme hypokalemia caused by an eating disorder. Ms. Schiavo's husband, Michael Schiavo, faced a public legal struggle with his wife's parents and siblings about whether Ms. Schiavo's life-sustaining medical treatment should be continued or stopped. Mr. Schiavo and the two neurologists that he selected to testify in court stood for the position that Ms. Schiavo's condition met the criteria for a persistent vegetative state and believed that her treatment should be stopped. Ms. Schiavo's parents, siblings and the neurologists testifying in court for Ms. Schiavo's estate stood for the position that Ms. Schiavo's condition could improve in the future and believed that treatment should be continued.

After years of legal battle, Mr. Schiavo was able to terminate his wife's life-support treatment. By then, however, his family had been tainted by bitter moments trying to guess Ms. Schiavo's desires regarding life-sustaining medical treatment. This could have been avoided if Ms. Schiavo had left her written wishes about receiving life-support treatment in a living will. With a proper living will, Ms. Schiavo could have decided under which circumstances she desired life-support machinery, and under which ones she did not.

5 Steps to Create an Efficient Living Will


  1. Appoint a health care agent: You appoint someone as your health care agent with a durable power of attorney known as Designation of Health Care Surrogate. Your agent will have the legal authority to make health care decisions for you if you are no longer able to speak for yourself.

  2. Attach a signed HIPAA release form: You must provide your health care provider with a HIPAA release form so that he can discuss your medical information with your agent. It is wise to provide a release form to all of your physicians and insurance carrier.

  3. Draft instructions for health care: Write instructions for your future health care outlining your wishes about life-sustaining medical treatment in the event that you can no longer speak for yourself. Your agent will be directed to implement your written instructions. This will be your living will.

  4. Revise: Your written instructions must be absolutely clear to be enforceable. Moreover, your written instructions must clearly answer the question about life-sustaining care.

  5. Notify your attending physician: Once you draft your living will, it is your responsibility to notify your physician that you have a one. Also, it is important that you discuss your health care desires with your physician. He or she is likely to be the one carrying for you if your instructions become relevant and is more likely to honor requests that have been communicated to him or her directly.

Important Considerations
Often a living will is part of a more complex document which also contains a designation of health care surrogate and a HIPAA release.
You must sign your living will in the presence of two subscribing witnesses. The witnesses cannot be your spouse or your blood relative. If you cannot sign your living will, then one of the witnesses must subscribe your signature in your presence and at your direction. While you are not required to seek legal advice to prepare a living will, it is a good idea to do so to ensure that the actual instructions for your wishes are stated accurately. For assistance in drafting a living will in Florida, call the Law Office of David M. Goldman PLLC at (904) 685 - 1200.

October 15, 2013

How to Create a Durable Power of Attorney in Florida

In Florida, a Durable Power of Attorney (DPA) is a document that allows you to designate someone to act on your behalf if you ever become incapacitated. The person creating the DPA is known as the "principal" and the person receiving authority to act on your behalf is known as the "agent" or "attorney-in-fact." Depending on the DPA, your agent will have authority to handle your financial transactions or to oversee your medical care.

Steps to Create a DPA

DPA for your finances: With this type of durable power of attorney, you can give a trusted person as much authority over your finances as you like. Your agent can handle simple tasks like sorting through your mail, or more complicated ones like watching over your investments. To create a Financial DPA follow the following steps:

  1. Choose your agent: Your agent must be a natural person who is 18 years of age or older. Your agent can also be a financial institution that has trust powers, has a place of business in the state of Florida, and is authorized to conduct trust business in Florida. Although your agent does not have to be a financial expert, you should trust that he or she has and will use common sense in making decisions that are in your best interest.
  2. Draft the DPA: A DPA must contain the phrase "this durable power of attorney is not terminated by subsequent incapacity of the principal except as provided in chapter 709, Florida Statutes." Otherwise, the document is a power of attorney and the authority granted to your agent to act on your behalf will terminate if you ever become incapacitated. Your DPA must also state how much authority do you grant to your agent to handle your finances, be signed by you and by two subscribing witnesses, and acknowledged by you before a notary public. Lastly, the document must state that your agent can exercise his or her power under the DPA only in the event that you become incapacitated.
DPA for your health: The name of this type of DPA is Designation of Health Care Surrogate (DHCS). To create a DHCS, follow the same steps to create a financial DPA but mention in the document that you grant the authority to your agent to oversee your medical health care in case you ever become incapacitated. Also, you must attach the following documents to your DHCS:
  • HIPAA release form: This form authorizes your health care providers to release your medical information to your agent.
  • Living will: This document allows you to draft instructions to your agent as to how to decide whether or not you will receive life support.
Why Do You Need a DPA Life is unpredictable. A sudden accident or illness can prevent you from being able to manage your financial affairs. Or even worse, it can leave you unable to tell the doctors what kind of medical treatment you desire. If this happens to you and you do not have a DPA, your relatives or loved ones will have to go to court to request a judge to name someone to manage your affairs. This proceeding can be expensive and will create a record available to the public. Moreover, the person selected by the judge might not know your desires and might even act contrary to them.

A DPA prevents this daunting scenario by allowing you to name someone you trust to handle your affairs if you are unable to do so, and allows you to draft instructions to that someone so that he or she can act according to your desires. Your instructions must be clear; therefore, it is wise to call an estate attorney for assistance with this matter. For an estate attorney in Florida, call the Law Office of David M. Goldman PLLC at (904) 685 - 1200.

May 26, 2013

Man without will dies and State may get 40 Million

Thumbnail image for will and testament.bmpForbes has reported that nearly 2.5 million Americans die each year without a will. While many states have default rules that define who will receive your assets, sometimes they do not cover your specific circumstances. Richard Blum, a Holocaust survivor and New York real estate developer appears to be one such example.

If you die without a will or living trust ("intestate"), state law will determine how your assets which are subject to probate are distributed, and the result may not be what you would want.

In Florida this generally means your probate assets will go to your spouse, then your children, then to parents, then to siblings and so on. While this may be fine for the traditional family, we see more families with children from outside the current marriage or relationships where they may not be a relationship that is legally recognized by the state.

Richard at 97 may have outlived his children and because it has been difficult to find siblings and or other relatives, his estate may end up going to the state of New York.

Some might say, if we have no family or relatives, then why not give it to the state. Other would prefer to help friends, caregivers, or a charity.

For families with minor children, a Florida will is how you select a guardian for your minor children if something was to happen to you. If you would like to create a will in Florida, contact us and we can evaluate if a will is the best solution for your circumstances.