Florida Estate Planning Lawyer Blog

In a recent article I discussed disclaimers, which are a refusal by a person to accept an interest in property. According to the Internal Revenue Code § 2518, the following is a list of requirements for a qualified disclaimer to be effective in Florida.

(1) A refusal is in writing,

(2) Such writing is received by the transferor of the interest, his legal representative, or the holder of the legal title to the property to which the interest relates not later than the date which is 9 months after the later of—
(A) the day on which the transfer creating the interest in such person is made, or
(B) the day on which such person attains age 21,

(3) Such person has not accepted the interest or any of its benefits, and

(4) As a result of such refusal, the interest passes without any direction on the part of the person making the disclaimer and passes either--
(A) to the spouse of the decedent, or
(B) to a person other than the person making the disclaimer.

There are different types of disclaimers for different assets. I have included a sample form of what is required to make a qualified disclaimer under a plan Download file. Because of the risk of doing an incorrect disclaimer, it is advisable to have a Florida Estate Planning Lawyer review or create the disclaimer for you.

Most people in today’s society would be happy to discover that they were being left an inheritance in a Florida Will . However, since inherited property under the estate laws of Florida is a gift, the beneficiary does not have to accept the inheritance. Although declining to accept a gift would seem odd to some people, there are a few reasons why it would be beneficial not to claim inherited property.

One reason why a person may not want to accept an estate gift is because the property may be undesirable. Property may become undesirable when there is a large debt owed on the property or significant maintenance would be required to sell the property. For example, an old abandoned gas station that was given to you in a will would probably not be worth taking because of the significant costs to modify the property and the taxes that could come with it.

Other reasons why someone would disclaim property are to prevent your creditors from taking the property, a feeling that it is wrong to benefit from someone’s death, and to reduce your tax burden, or it will only create additional estate taxes upon your death. While it may not be permissible to disclaim the property in all situations to avoid creditors, you should discuss your specific goals with a Jacksonville Estate Planning Lawyer as soon as possible because there are time limits on when a properly filed disclaimer can be done. Whatever your reason may be for not wanting the gift it is important to know a disclaimer must comply with federal law. Contact a Florida Estate Planning Lawyer who can assist you in the process and insure that the disclaimer is done correctly and complies with the appropriate laws of the jurisdiction.

In Florida all sorts of clerks, customer service people, insurance sales people, brokers, account managers, and other employees of financial institutions give customers advice about how to title accounts and name beneficiaries. In an effort to avoid probate, these seemingly harmless changes can cause many problems with estate plans.

Most new account forms at financial institutions ask you to name a beneficiary. This does not have to be completed and sometimes you are better off to leave it blank than to fill in a name or attempt to name a proper beneficiary.

Often when filling out beneficiary designations people do not understand how a share of the assets will be treated if that person predeceases them. Will the share go to their descendants or to other named beneficiaries and is that what was intended.

Other problem can happen when there are future children born who were not contemplated at the time the account was created or if all of the beneficiaries do not agree.

There are good ways of avoid Florida Probate , and it can often be dealt with through proper beneficiary designations, use of a will, or use of a Florida Revocable Trust.

Often a Florida Revocable Trust or Florida Will can simplify the need to change designations in the event of changes in your life such as a divorce, marriage, or birth or death of a family member. With a Florida Revocable Trust or Florida Will you can simply modify one document and it will take care of all of the accounts that are under it. Sometimes it is difficult or impossible to make changes when a spouse becomes incapacitated.

If you would like to review your Florida Estate Planning you should Contact an attorney familiar with Florida Estate Planning

Update:
Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.

Today a client of mine in Mexico contacted me about the transfer of their membership interest in an LLC upon their death. He had recently been told he had the "Pig Flu" or Swine Flu as we call it in the United States. Hopefully his case is not bad and he will make a full recovery.

His question was simple and perhaps the answer may help others so I am writing about it. He wanted to know whether his membership interest would become his business partners upon his death. Generally a business interest will transfer upon death by a will or trust and not have a payable on death designation. While it would be possible to create a payable on death designation on a small business interest it is not very common. As a result I suggested that the simplest way to deal with the transfer of his interest upon his death would be to do so with a will or other estate planning documents.

Every year people unexpectedly die from regular cases of the flu or other illnesses. Many individuals make changes to their estate planning documents when there are significant changes in their life such as a birth, death, child, move, major financial change. Perhaps the Swine Flu should be a wake up call for the majority of Americans who have no estate planning documents. With out Florida Estate Planning Documents the state of Florida will decide who receives your assets and who would raise your minor children. To review your Florida Estate Planning Documents Contact a Jacksonville Estate Planning Lawyer

When a decedent’s assets go into probate in Florida the Florida Probate Case will be in the county court where the decedent maintained his or her domicile.

Pursuant to Florida probate law a judge will normally decide and rule on the validity of a will. The judge will also rule on who the heirs are should there be a question or dispute as to the validity of a decedent’s heirs.

If the decedent appointed a personal representative to administer the Florida will, the judge will determine if the representative is qualified administer the estate. If there are no objections and the judge determines that the representative qualified, the judge will issue letters of administration. These letters of administration allow the executor or personal representative to administer the will. Any issues or conflicts that arise during the representative’s administration will be ruled on by the circuit court judge.

In re Estate of Carpenter, 253 So. 2d 697 (Fla. 1971), the Florida Supreme Court stated to raise the presumption of undue influence, a plaintiff must show a confidential relationship between the donor and the donee and active procurement of the gift. Because courts have found that a confidential relationship exists in most relationships, the real issue comes down to active procurement of the gift. Recently Patrick Lannon wrote a summary of case law on the topic for the Florida Bar journal. Carpenter gives a list of seven factors of active procurement of a will, the:

1) presence of the beneficiary at the execution of the will;
2) presence of the beneficiary on those occasions when the testator expressed a desire to make a will;
3) recommendation by the beneficiary of an attorney to draw the will;
4) knowledge of the contents of the will by the beneficiary prior to execution;
5) giving of instructions on preparation of the will by the beneficiary to the attorney drawing the will;
6) securing of witnesses to the will by the beneficiary; and
7) safekeeping of the will by the beneficiary subsequent to execution.

In contrast with inter vivos transfers courts use a balancing test when evaluating the six recurring factors:

1) the donee’s level of involvement in the donor’s affairs;
2) the donee’s level of involvement in the actual gift in question;
3) the relationship of the donee to the donor as compared to the natural objects of the donor’s bounty;
4) the secrecy or openness of the transaction;
5) the effect of the transfer on the donor’s pre-existing estate plan; and
6) the physical health and mental acuity of the donor at the time of the gift.

Generally it is much harder to undue a gift that takes place with a Florida Will than during the decedents life. These factors should be considered with making or planning to make transfers. With an understanding of how these issues are raised, it is possible to structure transfers so to avoid many of the factors of Undue Influence.

If you would like help in structuring transfers of property to help avoid the appearance of an improper transfer of property, Contact a Florida Will Attorney or a Florida Estate Planning Lawyer to review your case.

If you believe you have been harmed by the improper transfer of property, Contact a Florida Probate Litigation Attorney or a Florida Trust Litigation Lawyer to review your case.

Update:
Jacksonville Probate Lawyer, David Goldman has put together a Florida Probate Handbook that is being offered free to readers and visitors of his websites. If you would like a copy, visit the Free Florida Probate Handbook web page, fill out the form, and one will be sent to you within 24 hours by email.

Greedy Trustees can be a problem in Florida Probate Litigation and Florida Trust Litigation. Often the Trustee must be removed to resolve the issues. Adrian Thomas a Florida lawyer who specializes in Florida Trust and Probate Litigation sent me an article where he discusses individual and corporate trustees. Often banks and financial institutions make their money by managing Florida Revocable Trusts and Florida Irrevocable Trusts. In recent interviews by news organizations, some employees talked about abuse of powers and improper investments that placed profits ahead of the best interest of the beneficiaries of the Florida Trusts.

Some of the abuses included:

Charging inflated fees;
Making distributions difficult for the beneficiaries;
Not considering compelling circumstances for distributions of allocation of principal and income; and
Naming themselves beneficiaries or trustees in the wills of elderly Florida Citizens.

The new Florida Trust code is modeled after the Uniform Trust code and now provides legal remedies for the beneficiaries who are being victimized by greedy trustees.

The new Florida Trust Code includes remedies which allow the court to inquire into the appropriateness of a trustee and evaluate a change in circumstances for a judicial modification of the trust. In addition, Section 736.0706(2)(d) allows a trustee to be removed when there is a change in circumstances and the removal would best serve the interest of the beneficiaries.

Many of these problems can be addressed in the drafting of the Florida Living Trust by creating language and terms that beneficiaries can remove or modify the terms when it is in the best interest of the beneficiaries. In addition, judicial modification is a process where the court can modify a trust for similar circumstances. In Aelillo v. Hyland one beneficiary was favored over another beneficiary. The Florida Court removed the trustee because of conflict of interest.

If you feel that your are not being treated fairly by the trustee of a Florida Trust which you are the beneficary of Contact a Florida Estate Planning Lawyer who deals in Florida Probate Litigation or Florida Trust Litigation

In Florida a devise in favor of a beneficiary who predeceases the testator will fail unless there is clear intent or in certain relationships.

Under Florida Statute 732.603 a devise to a grandparent or a descendant of a grandparent of the testator does not lapse but would be distributed per stirpes UNLESS the testator gift is conditioned on the person surviving the testator or the testator provides for a substituted or alternative beneficiary.

A similar result is achieved when the decedent dies intestate (without a will). We often see complicated property distributions when a parent dies and one or more of their children predeceased the parent. In these cases, it is not uncommon to see the Florida homestead or other real property owned by representatives of multiple generations.

To find out more about your Contact a Jacksonville Florida Probate Attorney.

In Florida an encumbered property shall be entitled to have the encumbrance on the property paid at the expense of the residue of the estate only when the will shows that intent. A general direction in a will to pay the debts does not show that intent (Florida Probate Code Section 733.803 , Florida Statutes (2002))

In a recent case a Personal Representative tried to make the argument that since the debt was paid off a mortgage during the probate proceeding and that the above rule only applied if the debt was in place at the time of the distribution. In re Estate of Woodward (Fla. 2d DCA Apr 09, 2008)

The court said that the PR could not rewrite the decedents will and pay off the mortgage. The Florida Probate Code makes it clear that without a specific instruction in the will the property was to pass with the encumbrance.

If you are a PR or a beneficiary of an estate in Florida and you have a question about whether you can pay off a mortgage, Contact a Florida Estate Planning Lawyer to discuss your circumstances.

Invalid transfer of Florida Homestead with do it yourself deed leads to unintended consequences!

Man wants his second wife to have a life estate in his homestead after his death with the remainder to go to his children and not his second wife's children.

His mistake, he used a preprinted deed and filled it out wrong. The court found that he did validly convey a life estate to his wife, but did not convey the remainder of the property to his daughter because it must have been signed by both spouses.

The property went back to his heirs per stripes after his spouses death and not to his daughter as intended.

Florida's homestead provisions make it difficult to properly convey real property as you desire. There were valid ways of conveying the property correctly, but a preprinted form does not deal with non traditional families or non traditional conveyances.

Some other examples of Do it your self wills and bad news are covered in my articles listed below

Do it Yourself Wills? More bad news and
Do it Yourself Wills? a Good Idea or Not?
Do it yourself Estate Planning: Bad News Part 3
Do it yourself Estate Planning: Bad News Part 4
Do it yourself Estate Planning: Bad News Part 5
Do it yourself Estate Planning: Bad News Part 6
Do it yourself Estate Planning: Bad News Part 7
Do it yourself Estate Planning: Bad News Part 8

This is a common mistake found in Florida Probate cases, when people try to make their own wills, or transfer their assets without getting professional help from an attorney or accountant who is familiar with the effects of gifting and estate planning.

If you have used software, a form, or an online service to prepare your will, a deed, or other document, you Contacta Florida Estate planning Attorney or Florida Estate Planning Lawyer to review your documents for potential problems.

Vazpuez v. Bvrski, 32 Fla. L. Weekly D2415 (Fla. 2d DCA October 10, 2007)

Prior to his death, a decedent entered a contract to sell real property. The decedent died prior to closing on the contract. The purchaser filed a Petition for Administration in which he expressly alleged the obligation based upon the purchase and sale agreement. The purchaser subsequently filed a Petition for Appointment of Guardian Ad Litem to represent the interests of unidentified heirs, and again alleged the obligation based upon the purchase and sale agreement. The personal representative of the estate subsequently filed a petition for authorization to sell the real property pursuant to the contract.
The guardian ad litem objected claiming, inter alia, the purchaser had failed to file a claim in the estate. The trial court agreed and denied the request for authorization to sell the property.

On appeal, the Second DCA reversed, finding that the initial petition for administration and subsequent documents filed in the probate proceeding, while defective as to form, sufficiently stated the character and extent of the claim and were substantially sufficient to place interested persons on notice of the claim.

Bryan v.Dethlefs, 959 So. 2d 314 (FIa. 3d DCA May 16, 2007)

The decedent’s trust stated,

"Upon my death, the then balance of principal and accumulated income remaining in the trust fund shall be distributed to my grandson, Robert R. Bizzell, if he is living at the time of distribution."

The trust provided for distributions to other beneficiaries if Bizzell was not living.
Bizzell survived the decedent, but died intestate prior to receiving complete distribution of the trust assets, Bizzell’s half-sister one of the beneficiaries of his estate asserted the trust instrument vested the assets with Bizzell at the time of the decedent’s death, The appellants argued the trust assets vest only at the time of distribution and all undistributed assets should therefore be distributed to them as the decedent’s beneficiaries.

The lower court agreed with Bizzell’s half-sister and the appellate court affirmed, reviewing that the law favors early vesting of estates and any doubts should be resolved in favor of vesting.

The court determined the trust provision in question mandated distribution upon the death of the decedent and the last clause of the sentence "if he is living at the time of distribution" could lead only to the conclusion that the time of distribution intended by the decedent was at his death.

A Los Angeles judge has decided that the young daughter of former Playboy bunny and television personality Anna Nicole Smith will inherit her estate.

Although Smith's will, drafted before her now 18-month-old daughter was born, gave everything to her son, Daniel, it also said she intended that the assets in trust for him be shared equally if she had future children, reports the Associated Press. Meanwhile, Daniel died, at age 20, three days after Smith's daughter, Dannielynn, was born in 2006. Smith herself died about five months later, in early 2007, of an accidental prescription drug overdose.

She is perhaps best known as the young wife of an elderly Texas oil billionaire, J. Howard Marshall II. The two married in 1994, when she was 26 and he was 89. He died a little over a year later, and litigation over his estate is still ongoing. If Smith's estate prevails or a settlement is reached, her daughter could potentially inherit millions, Reuters points out.

Normally a Florida Estate Planning Lawyer would advise against signing a deed conveying a home or other property without recording the deed.

What happens if a Florida deed or Florida Enhanced Life Estate Deed is signed but unrecorded?
Is the deed valid?
What risks are associated with unrecorded deeds?
Why would someone want to sign a deed but not record the deed in Florida?

A Florida Deed is not invalid just because it is not recorded. There is the potential for claims from other people if they record a deed before you record a deed. In Florida, when a deed is recorded there are taxes that must be paid on any outstanding mortgage. For every $1000 of mortgage a fee of $70 is charged. While this may not seem like much, if the loan is $100,000 the fee will be $700 and if the loan is $500,000 the fee is $3500. Often people want to transfer the ownership of their property but expect to pay off outstanding loans prior to their death. To save the fees, clients often ask about waiting to record the deed. We would generally advise against such actions as in Florida the first person to record a deed, who does not have notice of a prior deed, and who pays for the property will be considered the owner.

As people age, they may forget that they signed a prior deed, and sell the property to someone else. If that person records before you do, your claim or right to the property would be invalid. In addition, as people age, they are sometimes taken advantage of and do things against their will. Although there may be a claim for undue influence, these are very hard and expensive to prevail on.

Another potential problem could arise if your father's estate plan distributes the real estate to someone other than you. If your dad's will bequests the property to your sister and you go to record your deed, you might find yourself on the business end of a lawsuit involving the estate.

There is always a chance the rules relating to recording a deed change. The current sales disclosure form that must be filed with deeds needs to be signed by both parties.

Unrecorded deeds can be useful under certain limited conditions, such as death-bed planning. However, personally, I would generally be reluctant to advise using an unrecorded deed. When clients ask about them it is important to let them know the risks associated with them.

Each set of circumstances is unique and sometimes the use of an unrecorded deed in Florida is worth the risk. You should contact an Estate Planning Lawyer to review your needs and circumstances prior to executing an unrecorded deed.

When reviewing your Florida Estate Plan be sure that your will does not conflict with other actions you have taken to avoid probate.

Assets that have joint ownership, payable on death designations or beneficiaries will not pass to the beneficiaries names in your Florida Estate Planning Documents. Often a person's will leave assets split equally among their heirs. When a bank account, IRA, CD, or life insurance policy names someone else as the owner, the asset is not counted as part of the estate and the asset will not be split how the will designates.

This can reduce the amount of assets that other beneficiaries receive compared to the person who is the joint owner or beneficiary of the bank account, IRA, CD, or life insurance policy.

One solution to this problem is the use of a funded Florida Revocable Trust or Florida Living Trust. The technique would be to name the trust as the beneficiary and have the trust make the distributions as you want.

For more details on these or other techniques you should contact to a Florida Estate Planning Lawyer or have your attorney review all of your account designations along with your Florida Estate Planning Documents.

The Florida Bar has released consumer information on Florida Probate where they describe many of the issues related to Probate in Florida. They discuss the following:

1. WHAT IS PROBATE?
2. WHAT ARE PROBATE ASSETS?
3. WHY IS PROBATE NECESSARY?
4. WHAT IS A WILL?
5. WHAT HAPPENS TO PROBATE ASSETS IF THERE IS NO WILL?
6. WHO IS INVOLVED IN THE PROBATE PROCESS?
7. WHERE ARE PROBATE PAPERS FILED?
8. WHO SUPERVISES THE PROBATE ADMINISTRATION?
9. WHAT IS A PERSONAL REPRESENTATIVE, AND WHAT DOES THE PERSONAL REPRESENTATIVE DO?
10. WHO CAN BE A PERSONAL REPRESENTATIVE?
11. WHO HAS PREFERENCE TO BE PERSONAL REPRESENTATIVE?
12. WHY DOES THE PERSONAL REPRESENTATIVE NEED AN ATTORNEY?
13. HOW ARE ESTATE CREDITORS HANDLED?
14. HOW IS THE INTERNAL REVENUE SERVICE ("IRS") INVOLVED?
15. HOW IS THE FLORIDA DEPARTMENT OF REVENUE INVOLVED?
16. WHAT RIGHTS DO THE SURVIVING FAMILY HAVE IN THE PROBATE ESTATE?
17. WHAT RIGHTS DO OTHER POTENTIAL BENEFICIARIES (OTHER THAN THE SURVIVING SPOUSE AND CHILDREN UNDER CERTAIN CIRCUMSTANCES) HAVE IN THE PROBATE ESTATE?
18. HOW LONG DOES PROBATE TAKE?
19. HOW ARE FEES DETERMINED IN PROBATE?
20. WHAT ALTERNATIVES ARE AVAILABLE TO FORMAL ADMINISTRATION?
21. WHAT IF THERE IS A REVOCABLE TRUST?

If you have questions about a Florida probate case please contact a Florida Probate Lawyer.

Professor Gerry W. Beyer author of the Wills, Trusts, & Estates Professors Blog, as reported on a mistake in estate planning where a Another Self-Help Estate Plan Gone Awry. In this case a man decided not to consult with anestate planning lawyer. He transferred the family home to his stepchildren son and $150,000 of securities to his son.

The house was highly appreciated and as such was a poor asset to select to use as a lifetime gift. Because it was transferred during life, the children had to use the father's basis instead of the price of the home at the death of the father. This resulted in over $80,000 in capital gains liability.

In addition the house, because it was transferred within 3 years of death, was still included in the father's estate value and did not reduce his estate taxes.

The moral of the story: Spontaneous self-help by a Testator / Grantor can backfire and deprive heirs of large percentages of an estate and prompt family tensions. Professional planning would have made a huge difference to this man's family.

Some other examples of Do it your self wills and bad news are covered in my articles listed below

Do it Yourself Wills? More bad news and
Do it Yourself Wills? a Good Idea or Not?
Do it yourself Estate Planning: Bad News Part 3
Do it yourself Estate Planning: Bad News Part 4

This is a common mistake found in Florida Probate cases, when people try to make their own wills, or transfer their assets without getting professional help from an attorney or accountant who is familiar with the effects of gifting and estate planning.

If you have used software, a form, or an online service to prepare your will, you should have it reviewed by a Florida Estate planning Attorney for potential problems.

Mitchell Port a California lawyer posted a link to an article on the California Tax Attorney Blog about an article on the State Bar Website which provides information on estate planning. Although this is a California bar website, many of the same issues and considerations are important to Florida residents interested in Florida Estate Planning. Much of the information is also found on The Florida Estate Planning Lawyer Blog which primarily deals with Florida issues.

1. What Is Estate Planning?
2. What Is Involved in Estate Planning?
3. Who Needs Estate Planning ?
4. What Is Included in my Estate?
5. What Is a Will?
6. What Is a Revocable Living Trust?
7. What Is Probate?
8. To Whom Should I Leave My Assets?
9. Whom Should I Name as My Executor or Trustee?
10. How Should I Provide for My Minor Children?
11. When Does Estate Planning Involve Tax Planning?
12. How Does the Way in Which I Hold Title Make a Difference?
13. What Are Other Methods of Leaving Property?
14. What If I Become Unable to Care for Myself ?
15. Who Should Help Me With My Estate Planning Documents?
16. How Do I Find a Qualified Lawyer?
17. Should I Beware of Someone Who Is a "Promoter" of Financial and Estate Planning Services?
18. What Are the Costs Involved In Estate Planning?

If you or a family member fees that a Florida Estate Plan will benefit you please contact a Florida Estate Planning Lawyer.

If you live in a Jacksonville Florida, like many other cities around the country where the (CLEO) Chief law Enforcement Officer of your city will sign a Form 4 for NFA purchases of Class 3 items, there are several solutions.

Class 3 Weapons include suppressors, short barrel rifles, machine guns, and other destructive devices.

The most common solution is to create a revocable trust to hold title to the firearm or class 3 items you desire to purchase. Florida now requires a nexus to the state of Florida to create a Florida Revocable Trust or Florida Gun Trust

A Gun Trust, Firearms Trust, Limited Liability Company, or Florida Corporation are all legal entities that are established under Florida State Law. Each of these entities can purchase and hold firearms. There are some advantages and disadvantages of each legal entity. Generally the Florida NFA Gun Trust is the least expensive to create and maintain. In addition the Florida Gun Living Trust provides complete privacy from the public as Revocable Trusts are not required to be registered or filed with the state. The lack of any required filings means, the only people who know the terms of the trust are those you choose to tell.

Florida Business entities typically cost $150 a year for the state filings in addition to the cost of a CPA to prepare and file the federal filings.

Although most Florida Revocable or Living Trusts can hold firearms or other class 3 items, many are not properly setup to deal with the issues involving firearms and other items which are regulated by the National Firearms Act (NFA). If the NFA is violated, the owners are subject to criminal charges, substantial fines, and forfeiture of not only the class 3 items in question but all firearms in the possession or ownership. ($250,000 penalty, 10 years in prison, and forfeiture of items)

The Florida NFA Gun or Firearms Trust must give the Trustee instructions and special powers so that they can legally manage for unplanned events. Weapons and other assets in a Firearms Trust can not be distributed like other assets upon the death or incapacity of the person who placed the items in the trust(The Grantor or Settlor).

Many individuals are using Quicken or other simple trusts to purchase class 3 items. Before doing something like this you should consider the adverse effects that can be created by this technique.

1) You put your family and friends at risk of criminal and civil penalties in the event of your death or incapacity.
2) What happens if these items are transferred to someone who is not able to accept them because of eligibility, residency, age, or mental condition.
3) What happens if your trust merges with another trust, which will survive.
4) What happens if you will transfers NFA assets to your trust upon your death, can the trustee say no, most trusts do not allow for this.
5) What happens if the beneficiary is under age?
6) Will you know the mental state of the beneficiary, at the time of transfer and who and how will a problem be dealt with?
7) What state will the beneficiary live in at the time of the transfer? Can they accept, or possess these items, if not, what will be done?

If your trust doesn't deal with these issues or you do not understand why they are important, you should speak to a Florida NFA Gun Trust Lawyer to find out the answers. Feel Free call, email or ask any questions using the contact form

Read more articles on Gun Trusts, NFA Trusts, or using Trusts to hold Guns, Weapons or Class 3 items.

One common mistake that people make when they have a spouse or children is to transfer their retirement accounts into their Florida Living Trust.

Generally, retirement accounts are not subject to probate because you can name beneficiaries. If you name individual beneficiaries, each beneficiary is given the most flexibility in the way they take and report the proceeds from the IRA.

If you name a Florida Living Trust, the beneficiaries might have to take all of the distributions in the year after death. This can happen when one of the beneficiaries is a charity or not an individual.

The other main problem is when there is a great difference in age between the oldest and youngest beneficiary. Often this happens when the spouse is one of the beneficiaries and there are children or grandchildren that are also named beneficiaries. When this happens it is possible to make all of the distributions the same as with the oldest beneficiary.

These problems can be solved or avoided if the retirement accounts are properly setup, separated, or if the problem beneficiaries are dealt with timely.

Generally its best to either name beneficiaries with retirement accounts individually, separate the retirement accounts while you are still alive, or name a separate revocable trust for these benefits that is different that the main revocable trust.

For more information on how to deal with retirement accounts in probate you should talk with a Florida Probate Lawyer who is familiar with Retirement benefits. It is even better to plan things upfront by using a Florida Estate Planning Lawyer.

As a Florida Estate Planning Attorney, I often get involved in planning for Disabled Florida Adults and Children. Often these individuals are receiving government benefits or expect to receive the in the future due to a physical or mental illness or disability. In some cases clients expect their spouse to need these benefits soon. If the individual receives income that is to create or acquires or maintains assets above a certain level, they will be unable to qualify for these government benefits.

Often the solution is to create a Florida Special or Supplemental Needs Trust. This trust can hold assets and income that would typically disqualify an individual. This money can then be used to supplement their lifestyle. The Connecticut Estate Planning Blog has a two part article on this topic and the rules there seem to be very similar to those in Florida. If you have someone in your family who is currently disabled, or you expect to need government benefits in the future, you should discuss this with a Florida Estate Planning Lawyer so that you can determine what the best option for your particular situation is.

Your Florida Estate Planning Lawyer will tell you that being appointed the PR / executor of an estate is not easy. The PR takes a personal risk and large responsibility to the estate of the decedent, the IRS, and the beneficiaries.

The main job of the PR is to manage the administration of an estate. Many small estates in Florida are distributed without the need of a Personal Representative or Executor. If the decedent had valid Florida Will, the PR can be name from the will, if not the court will appoint a PR based on qualifications and an order of priority. Generally the spouse is the first to be chosen as a PR, next the adult children along with any children who have legal guardians can be the PR. There is a statutory scheme to determining who will be the PR in a Florida Probate Case.

The PR will be responsible for locating the will, and additional documents to help determine what the debts and assets of the decedent are. In Florida probate requires a Florida Attorney. Once you are appointed as the PR, the court will issue you Letters of Administration. This document allows you to act on behalf of the estate. When you take actions, you will have to notify any interested parties (beneficiaries and creditors). The assets of the estate may be used to pay valid claims. One very important job of the PR is to file all current and final tax returns. This is one area where the PR has personal liability for unpaid taxes, penalties, and interest. Once all of the assets have been accounted for, creditors paid, and beneficiaries determined, the PR will distribute the remaining assets as instructed in the will or by the intestate statutes. The PR is also responsible for filing the accounting (a balance sheet showing the amount of the assets and whom they belong to).

The personal representative is entitled to compensation for the work that they do. The personal representative is also able to hire professionals or others to advise and administer aspects of the estates.

Often in the process of Florida Estate Planning, Florida Elder Law, or Florida Probate I get asked about the effects of Florida's Spousal Share Statutes. The statutes reserve 30 % of the decedents estate for a spouse in the event that the decedent did not provide at least that amount in their will or other Florida Estate Planning Documents. This right can be waived by the spouse in pre or post nuptial documents. Often for wealthy clients, or those who are legally seperated but not divorced the spousal share can become a big issue. If you think that a spousal share might be an issue with your estate planning, you should discuss it with a Florida Estate Planning Lawyer.

Last week a Florida Appeals Court looked at, Whether Florida's Spousal Share Statutes were constitutional or not?

Generally Florida Statutes are constitutional unless they are not rationally related to furthering a valid governmental objective. Lane v. Chiles, 698, So.2d 260, 262 (Fla 1997) In this case the court looked at whether the potential loss of property rights were rationally related to providing a share in the assets of the decedent.

The Florida Appeals Court upheld the statute and found that the statute was rational related to the purpose. The Florida Probate Litigation blog has an excellent analysis of the case In RE Estate of Magee Download file.

As a Jacksonville Estate Planning Lawyer, I learned that Florida did not recognize common law marriages. About a week ago, the founding partner of Wood Atter, came into my office and asked me about an estate plan involving a couple that were married under the common law many years ago.

Later I discovered that common law marriages prior to 1969 were valid in Florida. I asked some divorce Lawyers some questions and learned, that once married under the common law, you must still be divorced in a court. The divorce is the same process as with a traditional marriage.

Then I began to think that with the number of people who separate and never get divorced, there must be some estate plans had the potential for disruption because of an unreported common law marriage.

For example, a Husband and Wife were married under common law in Florida prior to 1969. They are later separated but not officially divorced. There would not be an official record of their marriage, so when one dies, there is an opportunity for the property of the estate to be distributed incorrectly.

If you were married through common law and now live in Florida It is important for you to have a Valid Florida Will that represents your wishes, if you are sepearted from your spouse and married either under the common law or by the state, you need to evaluate your Florida Estate Plan to make sure you assets are distributed as you desire.

Florida has some unique benefits for the spouse, if you were married under the common law and not divorced in a court, and your spouse died in Florida, you are probably entitled to some or all of your spouses assets. You should talk with an Jacksonville Florida or other estate planning attorney where your spouse lives or where your spouse died.

Although it is possible to create your own will using Quicken, an online service, or by just creating one on your own, a Florida Estate Planning Lawyer would likely caution against doing so.

A "Do it yourself will" can have many undesired results. The California Estate Planning Blog points to one of these. In their article they describe a man who died and bequeathed his home to five people, one being his wife. His will did not give the spouse the right to remain in the home for her life. Upon the request of any other beneficiary, the wife would either have to buy the additional interest, or be forced to move from the home. If you want to read the full details you can follow this link.

Often individually do not fully understand the consequences of the choices they make in a wills. In addition a Florida Will must comply with the Florida Statute of Wills to be valid. Most states have their own requirement for a will to be valid. A valid Florida Will requires that the person be competent, over the age of 18, understand what they are doing, know their possessions at the time they make the will, have two unrelated witnesses, and notarize the document.

Often there are problems with the execution of a will that do not become apparent until a Florida will is contested or submitted for probate. If a will does not have a proper self-proving affidavit, the work that must be done to prove the will is increased. This can cause the family to incur additional costs and delays in the probate process. Florida also allows a Florida Will to have some options that are not always available in other states. Once such option is the right to attach a separate writing memorandum. The separate writing memorandum can save money by not requiring a will to be redrafted everytime a change is needed. If you are not taught how to use this feature of the will, you could believe you are transferring items that cannot be transferred by the memorandum.

People have compared doing your own will to repairing your own car, doing your own surgery and coloring your own hair. While it is true that a person can eventually learn to do each of these, the results are not always as desired the first time. My favorite comparison is to coloring your hair, as I have personal experience with this and my wife. Often when one colors their own hair it does change the color, but not exactly as intended. Sometimes it good enough, but often it takes a professional to fix what was done.

The problem with a Florida Will or other Florida Estate Planning Documents is that you do not get the chance to see your results, much less correct them. Once you die, it is almost impossible to make a change. You cant say my dad used quicken and he told me that this is what he wanted even though his will doesn't exactly do that. Besides creating a Florida Will with a Jacksonville Estate Planning Lawyer should not be expensive.

With Florida Estate Planning it is important to consider the effects of a gun on the probate process.
Neil E. Hendershot a Professor at Widener University School of Law in Harrisburg and author or PA Elder, Estate & Fiduciary Law Blog, had a Student submit an article regarding the possession and use by elderly persons of firearms. The article has a great title "I Bequeath my machine gun to . . ."

After reading this article, it is even more apparent that one who owns Class 3 Weapons, needs to be conscious of the effect of their demise on their Personal Representative and/or heirs.

Uncertainty in proper disposition of such a firearm could lead to one’s client being convicted of possession of an unregistered firearm, punishable by up to 10 years, $250,000 in fines and the forfeiture of the weapon and any “vessel, vehicle, or aircraft” used to conceal or convey the firearm.

This article discusses the process of determining if and to whom a firearms is registered. What to do with an unregistered firearm, the preferred procedures for the destruction of specific machine guns. The benefit of destruction compared to turning them in. ( The parts are valuable, and the ban may be lifted one day).

No matter what state you are in, if you or someone you know has a Machine Gun, or other weapon regulated by the National Firearms Act (NFA), they should speak to an Estate Planning Attorney or Florida Probate Attorney who is familiar with the Act to protect their estate, Personal Representatives, Trustees, and Beneficiaries from the penalties associates with the wrongful possession or transfer of a weapon in violation of the NFA.

A Florida NFA (Gun / Firearms) Revocable Trust may be the solution for you.

On September 13, 2007, Professor Gerry Beyer posted an entry on the Wills, Trusts & Estates Prof Blog, which he edits, entitled "Dead People With Guns", referencing this post: One of the growing estate planning niches is preparing for the death of gun owners and handling the estates of gun owners.

Here are two sites which have detailed information about the issues and the solutions:

Neil E. Hendershot, "I bequeath my machine gun to . . ." , PA Elder, Estate & Fiduciary Law Blog, Sept. 12, 2007: * * *

David M. Goldman, Florida Gun Trusts or National Firearms Trust , Florida Estate Planning Lawyer Blog, July 30, 2007, National Firearms Gun Trust: * * *

The second site discusses the legal tool of a "Firearms Trust" (or "Gun Trust"), which provides special powers to a trustee not normally considered or granted, to carry out specified purposes of maintenance & disposition of weapons.

To discuss how this case may affect you, talk to your Florida Estate Planning Lawyer
In the recent case of Stone v. United States, No. 3:06-cv-00259, United States District Court for the Northern District of California (May 25, 2007), the declined to give a discount to the value of artwork.

The Court reasoned that artwork in not fungible. From that, and the testimony of the experts (and commenting that unlike this case, sales of fractional interests in real estate sales had comparable sales evidence of discounts) the Court concluded, in general, that a hypothetical willing seller of an undivided interest in art would rather sell the whole piece and split the proceeds, then sell a fractional interest at a discount. Such a sale might be by agreement or might be by partition. But, because a partition could be sought, no hypothetical willing seller would accept anything less than full value.

Turning to specifics, after dissecting the testimony of estate’s expert asserting a 51% discount, the Court said that “a small discount is appropriate to account for legal fees” (here, legal fees would have been about 1%) and a further discount of 2% for costs of sale should be added. No appraisals would be necessary. “Some discount” would be appropriate for the uncertainties involved in waiting to sell the art. The Court would give no discount for lack of control, lack of marketability, lack of liquidity, the time value of money or other discounts commonly discussed in such cases.

The Court stopped short of making a final determination of the appropriate discount. Instead, it ordered the parties to seek to reach an agreement on valuation. But the tone of the Court’s opinion suggests that, if pushed to decide, the Court would “just say no” to big discounts.

Letters Of Administration: In a Florida probate that involves full or ancillary administration, Letters of administration are issued by the probate judge to a personal representative, showing that the personal representative has the authority to act on behalf of an estate.

Once letters are issued the Personal Representative many not do anything they want. The letters, while allowing the PR to act create liability for the PR as well as a fiduciary duty to the beneficiaries and creditors of the estate including the IRS. A PR should not forget to file the 1040 tax return for the last year, the 1041 tax return for income made during the administration of the estate, the 709 estate tax return, and make sure that any minimum required distributions from IRA's or other retirement accounts are removed by December 31 in the year that the decedent died. The PR becomes personally liable for any unpaid or late filing fees including interest that are due to the failure to file these returns timely.

In Florida Probate, if an individual acquired assets while living in a community property state, those assets, their proceeds, and income received from the assets may be subject to a different distribution than assets or income that was acquired while living in a non community property state such as Florida. One way to resolve this issue is to have both spouses contribute the property to a revocable living trust.

Community Property:

Property acquired during a marriage and while living in one of the 9 community property states (see below). As a general rule, everything derived from the earnings of either spouse is shared equally by a husband and wife. Each spouse owns only one-half of the community property because the other half belongs to the other spouse. Community property rules can be modified by pre-marital and post-marital agreements made by the spouses. See also separate property, commingle, quasi-community property, and commingle. Florida law is a separate property state. Property that was Community property may retain its character as Community Property though when someone moves from one state such as Arizona to another such as Florida.

Community Property States:

States in which community property laws apply. Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington State and Wisconsin are considered community property states.

A new problem has begun to surface in Florida Estate Planning. What happens if you use email, or other online services? Will your loved ones be able to act upon your behalf if you are incapacitated or unable to act on your own?

With the rising use of the internet, it doesnt matter if you are in Jacksonville Florida or another city.How can you give your heirs access to information that may be stored online but secured by a password, but without the risk of unauthorized access.

If you put your passwords in your Florida will, they could change, or people who should not have access to them might gain access. Likewise biometrics (fingerprint or retinal scans) could also pose problems if there is not a password in addition to the biometrics.

The best solution seems to deal with a password vault where there is a master password. This way if your passwords change, the person who has access to the master password would always have the current password.

The master password could be on a document that is referenced within the will or other estate planning documents.

With the increase in electronic communications it’s important to choose a Florida Estate Planning Attorney who is familiar with the technology and how to deal with these recent problems in estate planning.

Another solution is to create a Digital Asset Revocable Trust. This trust can be the owner of all of your digital assets or the assets you wish others to have access to upon a disabling event or your death. Since most of these digital assets are licenses, the trust will survive your death and others will be able to access the information. You still need to plan on how to transfer the information or knowledge to the successor trustee or beneficiary.

In Florida probate is a court-supervised process that is designed to determine how to transfer the assets of a decedent upon their death. Property subject to Florida probate administration is that owned by a person at death, which does not pass to others by operation of law, contract or designation (such as life insurance policies, retirement accounts and transfer on death bank or brokerage accounts)

Probate administration transfers legal title of property from the estate of the decedent (the person who has died) to his or her proper beneficiaries as determined by a will, if no will by the state laws of intestacy and if there was a surviving spouse they may receive some statutory rights not provided for in the will such as homestead or an elective share.

The term probate means to prove. In the probate administration process the petitioner / personal representative seeks to prove the existence of a valid will or to determine and prove who the heirs are if there is no Will so the property passes by intestate succession.

Continue reading "Florida Probate Process - " »

Florida Estate Planning:

The process of preparing and planning for a persons financial, health care and personal affairs. It includes documents to designate an agent in the event of a future disability such as a Living Willl or health care surrogate to assist with health care matters if one is unable to do so, a power of attorney to help with financial matters, and wills and trusts to pass financial property to family, friends and possibly other organizations. Estate Planning can ensure that a person is able to pass their property exactly as they desire instead of how Florida law or their home state would dictate it pass and then if trusts are prepared they can direct how the property will be handled long after the grantor is dead. Estate Planning is critical for all people and not merely those with a large estate. It determines who the guardian of minor children would be, who the personal representative/trustee (if there was also a trust) would be that handles the affairs and a guardianship from having to be imposed where the court would take control. Florida probate could be avoided as well through the use of trusts and or proper designations for the way that property is held saving time and money. Also if it is a large estate money could be saved that would otherwise have to be paid for estate taxes. Once all the persons assets exceed a certain exemption amount the estate is taxed at over 40%. With proper planning substantial amounts of money can be saved.