March 30, 2012

2012 Tax Planning Seminar

David Adams of David N. Adams, Inc is having a Tax Planning Seminar to discuss the new tax laws which are set to start in 2013. The topics discussed will include information on current and future:

  • Income Tax Rates
  • Capital Gains Tax
  • Tax Strategies
  • Taxation of Dividend Income
  • New Medicare Tax
  • Estate Tax Schedules
He has invited his clients as well as our clients and readers of this blog to attend a Free Dinner at Maggiano's where these topics will be discussed. I will be a guest speaker at the event. If you would like to attend, please contact his office to RSVP.
The event will be 6:30-8:00 pm
Maggiano's Little Italy
St. Johns Town Center
10367 Midtown Parkway
Jacksonville, FL 32246

Seating is limited! Please call 904-339-0015 to reserve your seat today!

This information is not intended to be a substitute for specific individualized tax, legal or investment planning advice as individual situations will vary. Event partially sponsored by SunAmerica Capital Services and Cole Capital Corp., Member FINRA/SIPC.
Securities and investment advisory services offered through SagePoint Financial, Inc, Member FINRA/SIPC and a registered investment advisor. Fixed and/or Traditional Insurance Services Offered through David N. Adams, Inc. which. is not affiliated with SagePoint Financial, Inc. or registered as a broker-dealer or investment advisor. 324 6th Avenue North, Jacksonville Beach, FL 32250

March 29, 2012

How Many Death certificates Do I Need? What are the Differences?

The number of death certificates you will need will vary greatly depending on the amount and number of assets that the person had at the time of death. Most insurance companies, banks, & many creditors will request a death certificate. In addition, you will need a death certificate (short form - one without the cause of death) to open a probate case in Florida. While insurance companies will typically ask for a long version, most other creditors and institutions are ok with a short version. The Probate court will not accept a short version. For this reason it is a good idea to get 3-5 long versions and 5-10 short versions. You can always get more and many companies only need to see a copy of a death certificate.

March 28, 2012

Effects of Splitting Anniuty can be Harsh!

Sometimes clients who are in a divorce are ordered to split up assets. Some of these assets can have large penalties when surrendered. Once such example is an annuity. Often annuities have surrender charges and can also have tax penalties when they are held within an IRA. You might have a high yielding annuity that has a 10% surrender charge as well as a 10% additional tax penalty for removing funds early.

If your incremental income is taxed at 35% and you had to pay a 10 % penalty and 10% surrender charge, you could lose over 50% of the assets value to taxes and penalties. In addition, it may be hard to achieve the returns that many older higher yielding annuities are earning.

If you find yourself in such a situation, you may want to see if you can swap assets so that you can keep the annuity but pay the other party their share of its value without the penalty and tax consequences.

March 27, 2012

IRS Safe Harbor Rates for April 2012

The IRS recently announced safe harbor rates for April 2012. Safe harbor rates are the minimum interest rates that can be used to avoid gift tax treatment that is associated with below market rate loans. The minimum interest rates for April are still very attractive.

0.25% per year for loans for 3 years or less;
1.15 per year for loans greater than 3 years and up to 9 years; and
2.7% per year for loans greater than 9 years.

Some uses for these loans include business financing, business startup expenses, loans for a mortgage, or loans from irrevocable trusts to an estate of the deceased to cover administrative expenses and taxes. These Loans should always be documented by promissory notes and payments must be accounted for on a regular basis or they can be disallowed.

March 27, 2012

Indiana to repeal death tax as of Jan 1, 2021

Indians's Gov. Mitch Daniels signed to repeal the inheritance tax for deaths after Dec. 31, 2021. The relief is retroactive to January 1 and increases amounts exempt from the tax for 2012 deaths.

Currently 22 states and the District of Columbia impose an estate / inheritance tax in 2012. See Forbes article on Another State Death Tax Kicks the Bucket, Will More Fall? for more information on this topic.

If you live in a state that has an estate tax or inheritance tax you may want to consider the additional taxes that your estate or beneficiaries might be subject to in your planning.

March 26, 2012

Family is Unhappy with Bank but is Prohibited from Changing Banks.

Be careful of agreements that you sign with banks. This family is being held hostage by a bank that made the beneficiaries sign an agreement that required all 94 of them to agree prior to moving their money to another bank. The Tompkins family had been customers of Riggs Bank for nearly 50 years when a money-laundering scandal at the Washington lender prompted them to take their business elsewhere (to Chevy Chase Bank)....The family blames Chevy Chase for poor investment returns, among other things. They can\'t move the accounts, now worth $100 million or so, because of a fundamental error they made seven years ago when signing up with Chevy Chase: They failed to read the fine print. In their haste to flee Riggs, which was eventually sold to another bank, the family signed an unusual agreement that prohibits it from pulling the money from Chevy Chase unless all 94 family members who are beneficiaries of the trust agree. Having failed to secure familial unanimity, 10 of the grandchildren are now suing Chevy Chase Trust for the right to pull the funds.
March 15, 2012

Estate Planning Tips For Gun Collectors - Gun Trust Lawyer®

If you own firearms and have done estate planning, you might want to review your planning with a Gun Trust Lawyer®. About 5 years ago, I recognized the problems that are inherent with traditional estate planning (wills, revocable trusts, or the default planning offered by each state) as they relate to firearms.

Most Estate Planning is designed to deal with financial instruments and not the issues that surround the purchase, transfer, possession, and use of firearms.

Did you know that you will or trust probably contains language that instructs your family and friends to break the law after you die? Before you put your family and friends at risk of violating the law or giving a firearm to someone who you would not want to hand a gun, you should talk to your Florida Estate Planning Lawyer about creating a Gun Trust.

While gun trusts are great for regular firearms they have additional advantages when it comes to the purchase, use, possession, and transfer of the more restricted firearms like those sold by Dealers with Class 3 SOT licenses.

To learn more about Gun Trusts, visit the NFA Gun Trust Lawyer® blog

March 5, 2012

Attempt to Avoid Probate Earns Medicaid Applicant Penalty Period

Often in an attempt to avoid a relatively small probate fee, individuals can create huge penalty periods and taxable issues for themselves. Take for instance, a woman in New York who, two years before applying for Medicaid, transferred money from her account to an account with a co-owner. Transferring individually owned funds to an account with joint tenants is a common way to avoid a Florida Probate.

While her estate planning attorney seems to have given the advice, he was not aware of the problems that estate planning techniques to avoid probate can have on Medicaid eligibility.

Not only can transfers like this have problems for the individual making the transfer, but they can also create problems for the beneficiary or the new co-owner who will now have additional assets in their name, that may disqualify them from government benefits like Medicaid.

Before you try to save a few dollars and do what worked for your parents or friends, you may want to discuss your circumstances with a Jacksonville Estate Planning Lawyer who is familiar with Medicaid and Elder law issues.

February 29, 2012

What are Florida Advance Directives?

Advance directives.jpgYou asked and a Jacksonville Estate Planning Lawyer will advise you that according to Florida Law, an "Advance directive" means a witnessed written document or oral statement in which instructions are given by a principal or in which the principal's desires are expressed concerning any aspect of the principal's health care, and includes, but is not limited to, the designation of a health care surrogate, a living will, or an anatomical gift.

A Health Care Surrogate is chosen by the principal to act for the principal and to make all health care decisions for him or her during the principal's incapacity. The health care surrogate has the authority to consult with appropriate health care providers, to provide informed consent, to provide written consent, to be provided access to the appropriate medical records of the principal, and to apply for public benefits, such as Medicare and Medicaid on behalf of the principal.

The written designation of health care shall be signed by the principal in the presence of two adult witnesses. The person designated as surrogate shall not act as witness to the execution of the document designating the health care surrogate. At least one person who acts as a witness shall be neither the principal's spouse nor a blood relative. It is strongly suggested that the execution of the designation of health care surrogate be done in front of a notary.

A Living Will made be executed by any competent adult. It is a declaration concerning the providing, withholding, or withdrawal of life-prolonging procedures in the event that a person has a terminal condition, has an end-stage condition, or is in a persistent vegetative state. A living will must be signed by the principal in the presence of two witnesses, one of whom is neither a spouse nor a blood relative of the principal. It is strongly suggested that the execution of the living will be done in front of a notary.

In determining whether a patient has a terminal condition, an end-stage condition, or is in a persistent vegetative state, or may recover capacity, the patient's attending or treating physician and at least one other consulting physician must separately examine the patient. The findings of each such examination are then documented in the patient's medical record and signed by each examining physician before life-prolonging procedures may be withheld or withdrawn.

An "Anatomical gift" or "gift" means a donation of all or part of a human body, to take effect after the donor's death and to be used for transplantation, therapy, research, or education. Chapter 765 of the Florida Statutes has a comprehensive listing of provisions that detail everything one needs to consider when contemplating an anatomical gift.

Now that you know what "Advance Directives" are, contact a Jacksonville Estate Planning Lawyer to have your advance directives prepared today.

February 27, 2012

Elder Law Lawyers look to Alzheimers Research

happy_elderly_couple_americare.jpgAs Jacksonville Elder Law Lawyers, we are always looking for the most effective and least restrictive ways in which to serve the needs of our Jacksonville elderly. We keep current of the Florida statutes and the numerous Florida cases which interpret matters involving Florida's senior citizens.

Elder law encompasses many aspects, including estate planning, guardianship, medicaid issues, and of course, health care issues. As Florida Elder Law Attorneys, we also look to various research and articles throughout the nation which focuses on issues related to aging.

Recently an interesting article caught our attention dealing with coconut oil and it's effect on those suffering with dementia and Alzheimers. We want to share information we learn of that may have a positive impact on your lives. This article addresses alternative medical treatment.

Coconut oil, once thought to be harmful due to elevating cholesterol levels, actually has numerous positive influences on human health. While pure non hydrogenated coconut oil does in fact raise cholesterol levels it is the good (HDL) cholesterol that is influenced. Although there is little evidence at this point to support it, some leading researchers believe that Alzheimer's, dementia, ADHD and other central nervous system impairments can be helped with the use of pure coconut oil.

Glucose is the primary nutritional source for brain cells. Some conditions impair the body's ability to utilize glucose and as a consequence brain cells do not function optimally and will ultimately die.

Recent research along with antidotal testimonials suggest that the median chain triglycerides can provide a source of ketone to brain cells that acts as an alternative to glucose. Some patients with Alzheimer's and dementia have seen improvement in cognitive, emotional and physical function with the use of pure coconut oil.

If you would like information or direction with an elderly person in your life, consult with a Jacksonville Elder Law Lawyer.

February 2, 2012

7 Documents you Want Prepared Before you Die

untitled.bmpYou have heard it all before again and again. The reason for the repetition is . . . there really are 7 estate planning documents that should be prepared before one dies.

A Jacksonville Estate Planning lawyer will provide you with story after story that have no happy endings. These stories begin with people who talked about contacting a lawyer to have legal documents prepared, but never did.

The documents you need to consider today are:

  1. Last Will and Testament: This document allows you to name a guardian for your minor children in the event of your death, distributes your property to the people you want to inherit, allows you to donate to charity, among other provisions.
  2. Living Will: If you remember the Terri Schiavo Florida case, you will recall 7 years of court battles regarding life-prolonging procedures keeping Terri alive, after being diagnosed as in a persistent vegetative state. If a Living Will (which allows you to declare what, if any life-prolonging technology you desire) was in place, this costly, exhaustive and emotional fight would never have happened.
  3. Do-Not-Resuscitate Order (DNR): This document is state specific and it must be prepared in strict compliance with Florida Law. If prepared properly, it alerts medical professionals not to perform cardiopulmonary resuscitation on a patient when he/she stops breathing or the heart stops beating in specific medical conditions (end state renal disease, terminal cancer).
  4. Designation of Health Care Surrogate: This document allows you to name the person(s) you want to make health care decisions for you in the event that you are incapacitate or too ill to make these decisions yourself. If this document is not in place, the default health care substitute chosen may very well be someone you do not want to serve.
  5. Authorization to Release Health-Care Information: We have all heard of HIPAA (Health Insurance Portability and Accountability Act of 1996). This federal privacy rule provides protection for personal health care information. This law is so strict that if you have not executed a HIPAA Release even your health care surrogate or proxy will be unable to obtain and review your records.
  6. Trust Documents: There are numerous trusts for different types of situations. In general terms, a trust is utilized whereby property is held by one party for the benefit of another. For a listing of the various trusts available and their purpose, visit Jacksonville Trusts Attorney.
  7. Letter of Instruction: This document can be as simple or detailed as you desire. It can contain directions as to your burial and cremation wishes, organ donation wishes, and who you would like to care for your pets.

Don't let another day pass, contact a Jacksonville Estate Planning Lawyer.

January 31, 2012

Gay and Lesbian Parents Need Estate Planning

Rainbow families.jpgRaising and caring for your children is difficult enough without the additional complications that arise when you are bringing up children in a same-sex relationship. Inherent rights afforded to "straight" or heterosexual couples are non-existent for gay couples. The lack of legal rights for those in relationships not recognized by the State of Florida, will effect your property rights, your health care decisions, the distribution of your assets after death, and most importantly, your children.

If you are not the legally recognized or biological parent of a child, there are several legal documents you can utilize to provide you the authority you need.

A Last Will and Testament will enable you to name your choice of guardian for your minor child in the event of your death or incapacity. A Pre-Need Guardian Designation lends additional proof of your choice of guardian for your child(ren). An Authorization and Power of Attorney for Child Care will enable the person of your choice to have the authority to make decisions for and care for your children when you are unavailable. Unavailable may mean incapacity, or being out of town, or otherwise engaged elsewhere.

For additional documents and methods of ensuring that the "non-legal" parent's relationship with his or her children are protected, contact a Jacksonville Gay and Lesbian Estate Planning Lawyer to schedule a time to talk.

January 31, 2012

When if Formal Notice Used in a Florida Probate

There are certain times when a Probate case can use Formal Notice to reduce the time required and other times when it is required. Formal notice is defined by the Florida Probate Code to be notice which is sent by via certified mail to each interested person. Sometimes notice can be by publication when the whereabouts of a particular interested person or entity cannot be determined. This notice by publlication requires a much longer time period to the party to object than the 20 days when an interested party is serverd by formal notice. Some examples of when Formal Notice can or will be used include:

Petition for Administration
Petition to Determine Beneficiaries
Petition to Revoke The Probate of A Will
Petition to Probate Lost Will
Petition to Construe Will
Petition to Remove A Personal Representative
Petition to Surcharge Personal Representative
Petition to Cancel a Devise

January 30, 2012

Is Non Probate separate Property That Increases in Value During a Marriage Part of the Elective Share Calculation?

The 2nd District Court of Appeals for Florida held in McDonald v Johnson that the increase in a company stock value that happened during the marriage can be used to determine the value of an elective share calculation. The lower court ruled that the surviving spouse had no right to discovery of a company's financial information because the company stock was not subject to probate. The 2nd DCA found that Section 742.2155(6)(c) excluded non-martial assets as defined in Section 61.075. Because the increase in value of an asset that happens during a marriage is a martial asset, they concluded that the spouse was entitled to do discovery that was necessary to determine if it would be to her benefit to claim an elective share.

Section 732.2155(6) provides as follows:
Sections 732.201-732.2155 do not affect any interest in property held, as of the decedent's death, in a trust, whether revocable or irrevocable, if:

(a) The property was an asset of the trust at all times between October 1, 1999, and the date of the decedent's death;
(b) The decedent was not married to the decedent's surviving spouse when the property was transferred to the trust; and
(c) The property was a non-marital asset as defined in s. 61.075 immediately prior to the decedent's death.

The courts reasoning is as follows:

We conclude that the fact that section 732.2155(6)(c) cites to section 61.075 without a specific citation to the subsection defining non-marital property indicates the legislature's intent that the entire statute, which defines both marital and non-marital property, is to be considered in determining whether the property in the revocable trust was non-marital at the time of death. The definition of marital assets includes "[t]he enhancement in value and appreciation of non-marital assets resulting either from the efforts of either party during the marriage or from the contribution to or expenditure thereon of marital funds or other forms of marital assets, or both." § 61.075(6)(a)(1)(b), Fla. Stat. (2010). In other words, if the value of the MCC stock in the decedent's revocable trust increased pursuant to the terms of section 61.075(6)(a)(1)(b), that increase would not be excluded from the elective share under section 732.2155(6)(c). Thus, to the extent the information sought by the surviving spouse is necessary to her determination whether the MCC stock value was enhanced during the marriage due to the efforts of the decedent, it is relevant.

January 15, 2012

Gay Marriage a Looming Possibility in Washington State

gay-marriage-rights.jpgFlorida Gay couples await the possibility of a seventh state to legalize gay marriage, as the Washington State Governor introduced legislation on gay marriage early this month. At a news conference Governor Chris Gregoire stated, "Our gay and lesbian families face the same hurdles as heterosexual families - making ends meet, choosing what school to send their kids to, finding someone to grow old with, standing in front of friends and family and making a lifetime commitment."

For gay couples all over the country, including Florida, a state marriage license is very important. It gives same-sex couples the right to enter into a marriage contract in which their legal interests, and those of their children, if any, are protected by civil law.

For now, those in gay relationships in the Sunshine State will have to make do by protecting their own interests. This can be accomplished through a variety of legal documents. If you are a lesbian or gay man living in or around Jacksonville, Florida, take time to contact a Jacksonville Gay and Lesbian Issues Lawyer who focuses on LGBT documents to ensure that your rights, whether they pertain to health care, property, or your death are protected.