Living Trust / Revocable Trust

March 23, 2015

Funding Your Revocable or Irrevocable Trust

In Florida, a trust is not valid until funded. Many trusts need to be funded prior to your death to be used in the way intended. Often, individuals create trusts and forget to fund them during their life and do not receive the benefits that their trusts were designed for. There are 4 major ways to fund a trust.

Purchase items in the name of the trust. New property or items can be purchased in the name of the trust. When you purchase a new item or asset, the sale can be made out to the trust. Anyone can purchase these items, it need not be the creator or settlor of the trust.
Assign items to the trust. Generally, when a trust is created, many items can be transferred to the trust by the use of an assignment of personal property. This document will transfer personal property which does not require a deed or title to the trust. This is good for personal property like clothing, jewelry, and other minor issues. One needs to be careful not to assign firearms to your trust unless it is a gun trust as many traditional trusts do not properly deal with firearms issues properly and can cause legal and criminal issues for those who survive you. If you sign an assignment of personal property, you should exclude firearms unless the firearms are being assigned to a gun trust.

January 22, 2015

2015 Gift Tax: Can I Give My Kids $14,000 a Year?

by David M. Goldman

The amount you can give anyone without having to file a gift tax return in 2015 remains the same as 2014 at $14,000.

Remember that you can give your children, their spouses, your grandkids $14,000 each. In addition, if you are married, your spouse can also gift $14,000 to each person.

Generally, families use gifting to reduce the size of their estate do not need Medicaid long-term care coverage, but if you or your spouse need care and you have gifted money in the past, it may affect your ability to obtain coverage.

June 27, 2014

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

by David M. Goldman

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

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

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

June 26, 2014

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

by David M. Goldman

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

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

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

June 19, 2014

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

by David M. Goldman

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

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

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

August 31, 2013

Florida Asset Protection

by David M. Goldman

One of most common topics we discuss with our business and estate planning clients is asset protection. The best time to do asset protection is when you do not have any known or potential creditors. Unfortunately, this is often the least likely time to consider protecting your assets.

Today we have some innovative trusts that provide asset protection without the risks, expenses, and IRS compliance associated with Foreign ssset protection trusts or Domestic asset protection trusts (DAPT). A domestic asset protection trust is a trust created under state statute (not in Florida) which purports to protect the assets while still giving you access to the assets when there are no creditors. Unfortunately many states will not recognize the protections when there are assets which are located in another state. For example if you have your Florida property or bank account in a Nevada or other state’s DAPT, it is likely that a court in Florida may not offer you the protections you have expected.

Unlike a DAPT which relies on another state’s laws, our Florida Asset Protection Trust is an IGAP Trust which is based on statutory and common law principles regarding Trusts and Property and can be structured to protect the principal or principle and income of the property being held by the trust. The IGAP trust has no adverse tax consequences like some trusts do because it is taxed just as if you owned the property yourself. In addition some asset protection trusts lose the ability to increase the basis in the assets to the value at your death, but the IGAP Florida asset protection trust does not have this problem and receives the same tax treatment as if you owned the property yourself.

July 16, 2012

Should I receive regular payments from a Trust as a Beneficiary?

by David M. Goldman

Beneficiaries or people who think they are beneficiaries of trusts often ask up if they should receive regular payments or distributions from a trust. As with most legal issues the answers “depends on the circumstances and what the documents state”.

Without reviewing your trust to determine if it is a revocable trust, revocable trust that has become irrevocable, or an irrevocable trust as well who the beneficiaries it is difficult to tell whether you are entitled to anything.

Sometimes people think they are beneficiaries when they are contingent beneficiaries and have no rights until a triggering event occurs. Often that is the death of the person who created the trust or their spouse.

September 9, 2011

Protecting the Family Vacation Home

by David M. Goldman

Florida asset protection for homestead- House.jpg Often families have vacation property that has been owned for may years or generations. It would be virtually impossible for most children to acquire or maintain these types of properties in today’s market.

We often use business entities or trusts to hold title to the property and other assets to help provide for the management and expense of owning and operating a vacation home. When the property is going to be inherited by more than one child or family. An operating agreement or trust agreement can provide rules for handling allocation of time, and expenses among the children and their families.

If you have a family beech or lake home or a ski lodge you may want to talk with a Florida Estate Planning Lawyer about how to protect the property from your creditors, the creditors of your children, and disputes between your children regarding the use and expense sharing of the home in the future.

June 24, 2011

Reforming a Trust in Florida

by David M. Goldman

In order for a person to attempt to reform a trust, that person must “have standing.” This designation refers to a person who has an interest in the trust. This person can be a trustee, beneficiary, or a trustee and beneficiary. A settlor, the creator of the trust, gets to pick who will be designated in the other positions. While the settlor is still alive, he or she generally serves as trustee for that trust, and names a successor trustee to step in when he or she dies or becomes incapacitated.

The “interested parties” all have the power individually to petition a court to reform the trust. There are multiple reasons for trying to reform a trust, but which ever reason the interested party chooses as a basis for the reformation, the result must comply with both the current law and the original settlor’s intent.

The settlor’s intent is usually the trickiest to prove in court. If you have found yourself in a position where you believe a trust that you are involved in needs to be reformed, you should contact either a Florida Trust attorney to correctly set up your trust, or a Florida Trust Contests attorney who specializes in the aspects of litigation.

June 23, 2011

Florida Intestate Law Changes: You may now need or want a Florida Will.

by David M. Goldman

If you are a married person in the State of Florida and have not created a Florida Will or Florida Revocable Trust you should fully understand what will happen to your assets when you die.

Previously in Florida, if a husband or wife passed away with only children belonging to the surviving spouse, the surviving spouse would receive the first $60,000 of the decedents probate estate, while the rest was split equally between the surviving spouse and the children or their heirs.

Governor Scott signed the Florida Law on June 21st. The new Florida Law gives everything to the surveying spouse (where one has passed away without a will and is survived only by a spouse and children of that marriage).