Florida Estate Planning Lawyer Blog

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.

July 28, 2014

Banker Suicides indicate Stress of the Profession.

by David M. Goldman

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.

July 18, 2014

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

by David M. Goldman

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.

July 17, 2014

Can a surviving spouse claim loss of consortium after the other spouse dies?

by David M. Goldman

A recent ruling by the Fifth Florida Appellate Court on Friday allows surviving spouses to claim loss of consortium separately from others claims after the spouse dies.

The surviving spouse Margaret Randall filed the case, Randall v. Walt Disney World Co., in 2006 after her husband Barry Randall allegedly suffered injuries to his head and neck from riding a roller coaster. Besides personal injuries, Ms. Randall also claims loss of consortium. Loss of consortium is the inability of one spouse to have normal martial relations. Judges will sometimes award the surviving spouse damages for his or her loss of intimacy with their spouse.

The issue here was could Mrs. Randall claim loss of consortium after her husband died. Mr. Randall died shortly after the lawsuit was filed, which Mrs. Randall claims was a result from the rollercoaster injury. In Florida, the rules of civil procedure requires that when a party in a lawsuit dies a personal representative of the deceased’s estate must be substituted within 90 days. This is a rather harsh rule that must be performed on time or else the deceased party will be dismissed from the lawsuit.

July 16, 2014

The Benefits of Creating a TAP Trust for Protecting Retirement Assets

by David M. Goldman

A TAP trust is an extremely versatile trust designed to hold a variety of assets. This type of trust helps the grantor avoid needless estate taxes without the restrictions of other trusts.

The TAP trust can hold a variety of assets that include: real estate, stocks, insurance policies, bonds, and a few other business interests. A TAP trust can even own an IRA after the grantors death.

A TAP trust can set up as a grantor, or non-grantor trust. This distinction will decide h A non-grantor trust is taxed like a separate taxpayer with all income directly taxed to the trust at a trust income tax rate. However as a grantor trust, all income is taxed on the personal income tax of the grantor at an individual’s tax rate.

July 15, 2014

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

by David M. Goldman

The 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.

June 27, 2014

Protecting your IRA from Creditors and Preditors After the Supreme Court Decision

by David M. Goldman

The U.S. Supreme Court recently held that the funds contained in an IRA are not “retirement funds” and thus not protected from creditors during bankruptcy. The next question many attorneys now have is how this ruling will affect tax law?

The Supreme Court justices felt there were three legal characteristics that lead the Court to conclude inherited IRA’s are not retirement funds within the meaning of 11 U.S.C. Section 522(b)(3)(c).

Inherited IRA holders are not able to invest more money into the account.

June 26, 2014

Some of the Benefits of using Trusts for Estate Planning and Asset Protection

by David M. Goldman

Establishing a trust is often an important part of the management of your assets and estate. A trust can help to ensure decedent’s assets are passed to their heirs precisely the way they are intended.

Trusts can either be irrevocable or revocable. The person who creates a revocable trust can change the trust at any time. An irrevocable trust can be more restrictive, but can offer greater protection for an individual and their family.

The most important part of establishing a trust is choosing the right trustee. The trustee is an important person because he or she will be responsible for the record keeping, accounting, tax planning, and the investment decisions. It is important for this person to be someone who is trustworthy. Often, individuals manage their own trust, but it is important to pick a backup trustee or successor trustee who is trustworthy.

June 25, 2014

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

by David M. Goldman

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.

June 23, 2014

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

by David M. Goldman

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.