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MORE ABOUT ESTATE PLANNING AND PROBATE
The law in this field is ever changing so we try our very hardest to stay in tune with changes in the law. If you would like to speak to a local Fort Lauderdale estate planning attorney regarding your plan call us today at (954) 417-4879 to discuss the preparation of your will, trust, durable power of attorney or probate matter.
WILLS
In simplistic terms, a will is a document whereby an individual designates the individuals, charities or other entities who will receive his property upon death, who will manage his estate (in Florida known as the Personal Representative) and can include other provisions such as how a trustee under a trust created pursuant to the will should manage the trust’s property, who should be appointed guardian over any minor children and even may contain wishes concerning funeral arrangements. If a person dies intestate in Florida without having prepared a will (intestate) Florida Statute 732.102 will determine the manner and persons to whom the individual’s property is distributed. This may or may not be consistent with how you would have devised your property had you left a properly executed will. If there is property of the decedent that has not passed by operation of law (like a joint tenancy of bank accounts, contains a beneficiary designation or that has been titled in the name of a trust or other entity (an LLC or partnership) a probate proceeding will have to be instituted and the property will be distributed according to the terms of the decedent’s will if one exists or via the intestacy statute.
A properly drafted will remains an integral part of any estate plan. With the advent of the popularity of revocable trusts, wills are now often considered secondary or insignificant. However, even if probate avoidance is your main concern and goal, and even if you have successfully removed most of your assets out of the probate estate, either through titling property jointly, using beneficiary designations on bank or brokerage accounts, and life insurance plans, and/or through revocable trust planning, a will serves as a necessary back-up document. Even with a revocable trust, a will should be drafted that pours you estate assets over into the trust to be distributed in accordance with the terms of the trust in case you have neglected to properly transfer property into the trust as planned.
Estate planning utilizing wills can take many shapes. Wills can include provisions for the creation of testamentary trusts in the event you have minor or disabled children, or in the event a potential heir has judgment creditors or is too unsophisticated financially to handle receiving an inheritance all at once. Additionally, to adapt to constantly changing federal laws regarding taxation of estates and trusts, wills can be drafted with flexibility in order to best maximize estate and income tax savings for your family or other beneficiaries of your estate.
While it is easy to buy self-help will forms online, it takes a thorough understanding of many facets of Florida law and federal income and estate tax laws to include the proper provisions in in the will. A review of how the client’s assets are titled must be performed in order to ensure sure provisions of the will are not undermined by other property laws which will take precedence over contrary provisions contained in the will. A simple example would be property owned as joint tenants with rights of survivorship. Making things more complicate are constitutional and statutory provisions such as the restraint on the devise of the homestead if the decedent is survived by a spouse or minor child, elective share rights, and rights afforded pretermitted children and spouses. To properly draft a will that carries out your wishes, a full picture must be grasped. These rules are often confusing, even for attorneys in the field who study them constantly.
Revocable Trusts
Revocable Trusts have become synonymous with probate avoidance, cost savings, and other benefits. Trusts can definitely offer benefits depending on the types of assets you own and the number and type of family members involved in the equation. Despite, these benefits, it is necessary to understand collateral issues related to trusts, and certain steps must be followed to ensure that assets are properly titled in the name of the trust.
After death, even though the trust will ordinarily help you avoid probate, there are still creditor issues involved which must be taken into consideration, and if distributions are made prematurely, could subject the trustee to personal liability for amounts disbursed prior to taxes being paid, and creditors satisfied.
It is imperative that both the income taxes and estate tax of the decedent, if any, are paid, prior to the trustee making distributions or he or she could be personally liable for the amounts that are due the IRS. The trustee is also supposed to file a notice of trust in the county of death to alert potential creditors of the deceased grantee, that a trust may be available for to satisfy outstanding claims.the grandchildren would share unequally. The one child of A would receive 50 percent of the estate (representing his parent’s share), while b’s children would split their parent’s portion and would only receive ¼ shares of the estate.
When no relatives can be located who qualify to inherit the decedent’s property under the intestacy statute, the estate escheats to the state. In this situation, the property is sold and the proceeds of the sale are distributed to the State Treasurer.
If you would like to control the way your property is distributed when you are gone, some minimal level of estate planning is required, even if that only entails re-titling your property or naming beneficiaries on your financial accounts.
Contact our Fort Lauderdale or Boynton Beach office today to speak with an attorney regarding wills, trusts, powers of attorney or any other matter related to estate planning or probate.
Florida law provides that any trust executed on or after July 1, 2007 is revocable unless the instrument specifically provides otherwise. The power to revoke the trust usually does not pass to the contingent beneficiaries subsequent to the grantor’s demise. Otherwise, the right of revocation is usually personal to the grantor unless he or she vests the power of revocation in another person. Furthermore, pursuant to Florida Statute, 709.2201 and 709.2202(1), an agent may amend, revoke or terminate a trust, if the principal signs next to that enumerated power in the power of attorney document and the trust itself contains language “explicitly provides” for those rights to the grantor’s agent.
Manner of revocation- Under Florida Statute, 736.0602(3), a settlor may revoke or amend a revocable trust “by substantial compliance with a method provided in the terms of the trust.” If the trust does not contain language indicating the required method of revocation, the statute provides that the settlor may revoke or amend by executing a will or codicil that explicitly refers to the trust or devises property that otherwise would have passed pursuant to the terms of the trust or by “any other method that manifesting clear and convincing evidence of the settlor’s intent.”
A Florida court may permit termination of a trust when all persons with an interest in the trust consent to its termination. The court may be reluctant to do so however, if termination would defeat the intent of the settlor. Courts have differed on whether contingent beneficiaries are necessary and indispensable parties in a proceeding to terminate a trust. As a general proposition, courts are reluctant to terminate a trust merely because the beneficiaries are requesting that relief. This is a result of the general principle that a settlor has the right to dispose of his property in any way he or she pleases. Thus, courts may allow the beneficiaries of a trust to terminate a trust if the purpose for which the trust have been materially satisfied. If both the grantor and all trust beneficiaries consent to termination, the trust can be terminated even if its purposes have not been accomplished.
There are many other situations in which a trust can be modified or terminated which will be discussed in depth in further articles.
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Durable Power of Attorneys
Powers of attorney in Florida are governed by the Florida Power of Attorney Act (“the FPAA). The following is a brief outline of the provisions of the statutes regulating the validity and enforceability of powers of attorney in Florida.
Definition
A power of attorney is defined in Florida Statute 709.2402, as a writing that grants authority to an agent to act in the place of the principal. The statute provides that “durable powers of attorney” are not terminated by the subsequent incapacity of the principal, while non-durable powers of attorney are terminated in the event the principal becomes incapacitated. According to the statute, the term incapacitated means that an individual “is unable to take those actions necessary to obtain, administer, and dispose of the individual’s property and income.”
Documents
While originals of the document or often required for recording in the county recorder’s office when a power of attorney is being used to convey real estate, the statute provides that a photocopy of the document has the same legal effect as the original. Powers of attorney executed after October 1, 2011 must be signed by the principal and by two subscribing witnesses and acknowledged before a notary public or as otherwise provided in F.S. 695.03. People often ask whether powers of attorney executed in other states are valid in Florida. The statute provides that foreign powers of attorney are valid if executed in accordance with the laws of the state in which they were executed.
Termination
Powers of attorney terminate under following circumstances, among others. 1) when the principal dies; 2) upon the principal being adjudicated incompetent by a court, unless the court orders otherwise; 3) the principal revokes the power of attorney, or 4) if a power of attorney is not durable, upon the incapacity of the principal.
Revocation
A power of attorney may be revoked by either executing a subsequent power of attorney which includes specific language providing for the revocation of the previous power of attorney. A principal may also revoke a power of attorney by a signed written document expressing the revocation.
Summary
The above is a brief summary of powers of attorney in Florida and does not cover all of the tangential issues involved in enforcing powers of attorney and the relation of third parties to the principal and agent acting pursuant to the powers.
Learn more about Durable Powers of attorney and Lady Bird deeds here in our Blog
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Call us: (954)417-4879
If you would like to discuss your estate plan or probate case with a local Fort Lauderdale attorney please contact our office today at (954)417-4879. We are a full-service estate planning law firm who can assist you with drafting your will, revocable trust durable power of attorney and any probate related matter.
IS YOUR FAMILY PROTECTED WHEN YOU'RE GONE? GET PEACE OF MIND BY CREATING AN ESTATE PLAN THAT YOU AND YOUR FAMILY CAN RELY ON TO SECURE ITS FUTURE.
CALL US TODAY AT (954)417-4879 to discuss your estate plan.
