Florida DR-219 Form is Repealed as of 06/1/2008
Beginning June 1, 2008:

•The requirement to complete and file Form DR-219 is repealed.
•The Department of Revenue will not process DR-219 forms received.
•Destroy all blank DR-219 forms in your inventory.

The repeal of the requirement to complete and file Form DR-219 does not impact documentary stamp tax payment and filing requirements. Documentary stamp tax continues to be due on all documents that convey an interest in Florida real property. The tax must be paid at the time of recording with the Clerks of Court or County Recorders if the document is recorded prior to the 20th day of the month following the month the document is delivered. The tax must be paid directly to the Department of Revenue by the 20th day of the month following the month the document is delivered if the document is not recorded before. Delinquent payment of tax will continue to be subject to penalty and interest charges.

The Florida Supreme court has ruled affirmatively on the question presented to it.

Whether, under Florida Statutes section 689.07(1) as it existed before
its 2004 amendment, this Deed–which is a recorded real estate
conveyance deed to a named trustee of a private express trust
identified in the deed by name and date, and contains other language
referring to the unrecorded trust agreement, the settlors, and the
beneficiaries–conveys only legal title to the property in trust to the
grantee as trustee.

In Raborn v. Menotte, 974 So. 2d 328 (Fla. 2008), the court held that a deed which identifies the grantor as the creator of and the grantee as trustee of a named trust shows sufficient “contrary intention” and grants legal title as trustee to the grantee.

This case was brought to my attention by an article by Gerry Beyer on the WIlls, Trust, & Estates professors Blog.

Spendthrift clauses can be confusing to trustees. The general idea with a Florida Spendthrift clause is that the beneficiaries cannot assign their interest in the trust to a creditor ( voluntarily or involuntarily)

Here is the test found in a typical clause under the new Florida Trust Code

Spendthrift Provisions. Each trust created by this Trust Agreement shall be a spendthrift trust to the fullest extent allowed by law. Prior to the actual receipt of trust property by any beneficiary, no property (income or principal) distributable under any trust created by this Trust Agreement shall, voluntarily or involuntarily, be subject to anticipation or assignment by any beneficiary, or to attachment by or to the interference or control of any creditor or assignee of any beneficiary, or be taken or reached by any legal or equitable process in satisfaction of any debt or liability of any beneficiary, and any attempted transfer or encumbrance of any interest in such property by any beneficiary hereunder prior to distribution shall be void.

The most common application of a Spendthrift Provision is to protect against involuntary assignment or bankruptcy.

While this may be fine with a small estate, this question often comes up with larger estates.
Why would I want to void my child’s right to his 5 Million dollar distribution to avoid paying his creditors $25,000. Would it not be better in such a case to pay of the creditor and let my child enjoy and use the benefits of the trust rather than treat his a being predeceased?

Although it is not clear, the trustee can take this into consideration and make the distribution even though the creditor will receive a small portion of the decedents estate.

In these types of cases, I prefer to include language that a trustee can, in their discretion, make a payment when they know that a portion will go to a creditor of the beneficiary. Some times there is a limit placed on the amount and other times there is no limit placed on the maximum amount that can be used to pay a beneficiaries debts.

The Louisiana Estate Planning Law Blog has an article Whether you should include a “Spendthrift Trust” in your will? where they discuss using a spendthrift trust to prevent your children from loosing the money you leave to them.

If you want to make sure your children do not spend or loose all the money or assets you leave to them. It is also common to include a spendthrift provision in a NFA Gun or Firearms Trust to protect the items from being lost to a creditor. To find out more about how a Spendthrift Clause can help you Contact a Florida Estate Planning Lawyer
about including a Spendthrift Provision in your Florida Estate Planning Documents

It could be happening again in Florida, The Palm Beach Post has a report on a similar case. If you do not have a Florida Living Will now is the time to get one.

Karen Weber did not have a Florida Living Will when she suffered a seizure back in November. Her husband wants to disconnect the feeding tube that has kept her alive for the past 7 months.

The courts have not ruled on Ms. Weber’s condition and it is Mr. Weber’s intent to keep it a private matter.

Who could forget the circus that can arise when such an emotional issue is tried in the court of public opinion.

If you need a living will you can get a free one, I have previously posted a Free Florida Living Will on this site.

If you need help with Florida Estate Planning Documents please Contact a
Florida Estate Planning Lawyer

Florida LLC’s are one of the best choices for a new business entity. When thinking of forming a company, may people only look for low taxes and protection from liability.

Unfortunately, many are misinformed as to the protection that a corporation can offer. While it is true that a corporation and a Limited liability company can both protect a persons personal assets from corporate liability (in most cases), only the properly created Florida LLC can protect your business assets from personal liability.

If someone sues you and wins, they can take your stock in your corporation just like they could take your stock in GM. Once they own your stock, they can sell the company, fire you, and liquidate the company. If this happened to you it could cost you your livelihood.

To protect against this many people now use limited liability companies in Florida. If the LLC is properly created you can be protect from judgments, reduce the risk of lawsuits, and still be taxed as a partnership or an S-Corp. Yes you can be a LLC but choose to be taxed as a S-Corp.

While legal Zoom will let you create a Corporation or LLC online in almost any state, they can not evaluate your personal circumstances, and make recommendations on how to set up the LLC to offer you the protections under Florida Laws. I have seen many LLC’s created by Legal Zoom which failed to take advantage of these protections.

In addition, I have noticed that the people who use these services do not understand the importance of acting like a business entity. They rarely have meetings or authorize actions by the board members or officers. These actions can create prevent the business entity from protecting the owners, directors, and shareholders from personal liability.

Part of what your lawyer should do is understand your circumstances, and design an entity to protect your needs and interests. At the same time, the attorney should educate you on how to take advantage of the protections offered. just because your form an LLC or Corporation does not mean you are protected.

To discuss how to use your business entity to protect your personal assets and protect your business assets from the owners personal liability you should Contact a Florida Business and Asset Protection Lawyer

Florida Dog Bite Liability.jpgSeven weeks ago, I got a new puppy. I was thinking of a way to protect myself from Florida’s Strict Liability for Dog Bites. Most states have a one free bite rule, but Florida does not and makes the owner of the Dog liable for all damage by the dog from the first bite.

In walks the Florida Revocable Trust. I began thinking that if you set up a separate revocable trust that owned the dog, you could transfer the liability of the dog’s future actions to the revocable trust.

I began reading the Florida Statutes and sure enough the statute states that the “owner” is the party liable. Figuring that this must be too easy, I kept reading. It seems that when the state creates statutes, the often hide the real details in some other part of the statute. Sure enough after a few minutes I found that “Owner” as defined in the statute means any person, firm, corporation, or organization possessing, harboring, keeping, or having control or custody of an animal or, if the animal is owned by a person under the age of 18, that person’s parent or guardian.

So while the trust would be liable as the owner, so would the person who the animal was staying with and the person keeping the animal, and the person in control or custody of the animal at the time of the attack.

So what did I learn from this exercise? You should be very careful when offering to take care of someone’s pet while they are out of town as the person in control and / or custody is just a liable as the person or entity that owns the animal. More over your homeowners insurance may cover your liability as an owner, but I am not sure if they would cover damage caused by a pet that you did not own.

The only other way to protect yourself from liability is to have good insurance and / or protect your other assets.

To discuss potential sources of liability that you can help protect your self and your families assets from, you should contact a Florida Asset Protection Lawyer or read more on Jacksonville Asset Protection

For families living in Florida, choosing a guardian for their minor children is a primary reason why a Florida Will is such an important document to create and keep updated.

Often choosing who will care for your children is a difficult decision. Many families find it the hardest decision that they make in terms of estate planning. This is one area where it is common for the husband and wife to have completely different views of who should raise their children in the event that both the husband and wife die prior to the children reaching the age of 18.

First it is important to know that the planning is more important than agreeing with your spouse. Although it can create some tension between spouses, it is important to know that should one of you predecease the other, and then the surviving spouse gets to make their own decision anyway. Also, as long as one of you lives until the children reach the age of 18, it will not matter who you choose.

It is more important to discuss the reasons with each other and if possible come to a decision as to what is important to each of you than to try to come to a decision that one of you does not agree with.

The Georgia Wills, Trust, and Estate Planning Blog has an article on choosing the right guardian for your children where the break down the process into three steps. This three-step approach should make the process easier to accomplish without damaging the marriage.

Step 1 Make a list of people – make it long and include everyone that would make a better home for your children than the foster care system.

Step 2 Decide What Matters the Most – choose factors that are important and rank them in an order of priority. Some examples are maturity and patience, parenting style, religious beliefs, values, ability to care for additional children, and do not forget their willingness to serve (don’t forget to ask them)…

Step 3 Match People to the Priorities – rank and evaluate your choices. Listen to each other and try to come up with a coherent reason for the choices you will make as a couple, or individually. Remember you may not be exactly happy with your spouses’ choice, but if you live longer you get to change your mind anyway. Perhaps its better to come up with someone you can both agree upon in case you both die simultaneously.

To choose a guardian properly, you should make a valid Florida will. Please contact a Florida Will Attorney or Florida Estate Planning Lawyer to help you prepare valid documents that accomplish your goals.

Before making a Florida will you should think these things before drafting or having your Florida will modified.

In Florida to create a valid will the person needs to know what assets they have, who they are giving them to, and have an understanding of who they would go to if they were not listed in the Florida Will.

In addition, there are specific execution requirements to make sure the resulting document is a valid Florida will. The Jersey Estate Planning Blog has a nice summary of what should be considered when creating a will.

I have adopted the issues to Florida, but in general they mention the following issues to consider when making a Will:

1) What assets will put into the Florida will.
2) Who you are going to leave your assets to;
3) Who will administer your will?
4) Who will care for (minor children) both financially and physically?
5) Who will witness the execution of your Florida Will

In addition, you may consider what how you would like your body dealt with upon your death. Although this can be placed in your Florida will, it is advisable to let others in your family, those who will make the decisions, know what your plans are. Generally, your will cannot be looked at by the time these decisions need to be made.

A Florida will is a very important document and careful attention should be paid to what it states and how it is executed. Unlike other documents that you may sign during your life, this document cannot be changed once you die. I like to contrast it to dying your hair, if you do not like the color you can seek the help of a professional, try again, let it grow out, or even cut it off and wait for your hair to re grow. With a Florida will or a will in any state, you do not have any of these options and your family, heirs, and beneficiaries do not get the chance to make changes because of unforeseen changes or poor choice of words.

Most people think a Florida Will is an expensive document to create, but generally they are not much more than what you would pay an online service. Many online services allow you to create documents that have unintended consequences. I have a section on this blog with many examples of estate planning problems created by the wrong choice of words. Before you create a Florida Will you should contact a Florida Estate Planning Lawyer or a Florida Will Lawyer to discuss your needs and objectives.

Florida QPRT (Qualified Personal Residence Trust): Options:

Often clients want to make sure their homes go to their children. In Florida, a homestead will automatically go to your descendants and be protected. One of the problems is that although the home is generally not subject to Florida Probate, the value of the home at the time of their death is subject to estate tax. Once option of leaving a home to children is to use a special trust designed for the home. There are many advantages and disadvantages of using a Qualified Personal Residence Trust in Florida (QPRT).

Andrew Ewalt recently wrote an article on this on his Legal Blog where he listed the basic Pros and Cons. It is important that there are risks involved with a QPRT and each persons situation needs to be evaluated to determine if this is the right way to deal with the transfer of one’s Florida Homestead. QPRT’s are not for everyone, and many who used them in the past have ended them because of the changes in tax laws and how they impact their individual estate plan. As with all Florida Estate Planning it is important to review and update you estate plan on a regular basis.

The Advantages of a QPRT that Andrew list are

1. A QPRT removes any appreciated value of a house from a parent’s estate which can help reduce estate tax liability.
2. The parents can continue to live in the house during the term of the trust.
3. Both residence and vacation homes can qualify.
4. Often more than one home can be protected.
5. When the trust term ends the children receive the home.

The potential disadvantages of a QPRT are:

1. Capital gains tax can be a significant factor on the sale of the home because the cost basis of the house remains the same as it was for the parents. (as the capitol gains is suppose to increase shortly, this can be a significant issue)
2. If the parents die before the trust terminates the home will not be devalued for estate tax purposes. Thus it is very important the parents survive for the term of the trust.
3. Children will become their parents landlord when the trust terminates. As such children could evict their parents or increase the rent to live in the home.
4. These trusts are very complicated. In order to set one up you will need a lawyer.

If you live in Jacksonville or have property in Florida that you are considering placing in a Qualified Personal Residence Trust (QPRT) you should discuss your personal situation by Contacting a Jacksonville Estate Planning Attorney

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