A Revocable Trust Is the Best Estate Option Should You Become Ill or Incapacitated

An important comfort to getting older is knowing that your hard-earned and carefully managed assets can be passed on to your family and other beneficiaries. But what happens if age or illness prevents competent supervision of one’s estate? It’s a difficult question to grapple with, but not one without an answer.

A revocable trust offers the best of all options. A revocable trust, or living trust, is a legal document that puts your chosen assets into a trust for your benefit during your lifetime. Income is earned on the assets and trust provisions can be easily adjusted for any number of reasons.

At the time of your passing, a handpicked representative, known as a “successor trustee,” will distribute your estate according to your wishes. A revocable trust can also outline how it should be determined that you are no longer able to manage your affairs. For example, a diagnosis from your personal physician along with a separate, independent medical opinion.

Your successor trustee can then seamlessly step in and manage both your finances and property without missing a beat. This continuity is a major advantage, and cannot be as easily obtained through a standard will and testament.

A will would require your loved ones to rely on other documents such as a durable power of attorney or health care advance directive. Without advanced directives like these, your loved ones would have to seek a court-appointed guardian or conservator. This can be expensive, inconvenient and overwhelming for distraught family members. The court-appointee would also have to report back to the court regarding incurred expenses, the sale of property, and other items.

It bears repeating: Your personally chosen successor trustee will not be subject to court intervention as in the case of a will. And if you dispute a determination of incapacity, the revocable nature of a living trust allows you to retain control of your estate.

A will combined with a durable power of attorney can accomplish similar objectives regarding the transfer of estate management, but since the person giving the power of attorney owns the assets, probate administration would be required at the time of death – something many people try try to avoid.

Probate proceedings involve administration costs, including court fees and likely attorney fees, and are public record. A revocable trust circumvents probate entirely. We are ready to discuss this with you further. We encourage you to schedule a meeting with a member of our legal team to discuss the Florida estate planning that is right for you now and in the future.

Getting a divorce? Don’t forget to update your estate plan

Couples fight over finances more than almost any other topic, and when personal finances are ailing, many marriages tend to go the same way.

If you and your spouse are victims of this phenomenon, there are many steps that can be taken to try to gain control of the fire before it gains control over you. Options range from finding professional marital counseling to a visit to your financial planner to help understand your financial options. Even if you overlook the emotional toll (which obviously is no small thing), the cost of saving a marriage is much less than the cost of dissolving it.

However, even the most determined and well-intentioned couples will sometimes end up going their own ways. If that does happen, it is more important than ever to ensure that you and your family (and your business if you have one) are protected.

It is likely that many of your tax-deferred savings accounts (retirement accounts, life insurance policies, etc.) name your ex-spouse as the beneficiary. It is also likely that if you created any estate planning documents pre-divorce, your ex is named as your health care agent, financial agent, executor, etc. If you had an amicable divorce you may still be okay with this, but what happens if your spouse remarries? What if he or she has children with the new spouse?

If you are recently divorced or going through a divorce, you are going to be overwhelmed, emotional and exhausted. The easiest thing in the world would be to put off your financial or estate planning. One word of warning:  Don’t.

Our experienced and trusted estate planning attorneys have been serving Treasure Coast families for decades, and Michael Fowler is one of only four Treasure Coast attorneys who is Board Certified by the Florida Bar in Elder Law.  Contact us for your initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

Guidelines for Choosing an Executor for Your Estate

When making a decision on who should serve as the executor of your estate, you should take into consideration each of the following:

Family vs. Nonfamily – The executor of an estate is responsible for all administrative duties associated with the estate until it is legally closed.  The executor’s duties begin when a will is admitted to probate, and continues through the payment of any bills or taxes, disbursement of estate assets to beneficiaries and overseeing any potential challenges to a will.  The more complicated the estate, the more complicated the executor’s job.

Many people nominate a family member, but you should settle on a person who is organized, responsible and trustworthy – that person may or may not be a member of your family.  And if you don’t have a close family member who could handle the executor’s responsibilities, you may wish to name an attorney, accountant or corporate fiduciary as your executor.

Cost of an Executor – Florida statues allow “reasonable compensation” for executors as follows:

  • 3% for the first $1 million of estate value;
  • 2.5% for estate values of $1 million to $5 million;
  • 2% for estate values of $5 million to $10 million; and
  • 1.5% for estate values over $10 million.

Family members frequently waive executor fees but they get reimbursed for any out-of-pocket expenses like travel expenses.

Whomever you choose as your executor, be sure they understand what the job entails and they agree to serve in that capacity for you before you finalize your will.  Be sure you name one or more alternates, and keep up with your primary executor – if they die before you do and you have not named an alternate, the court will make the decision for you.

The Estate, Trust & Elder Law Firm, P.L., provides attorney services ranging from estate planning for young families to probate and advanced and crisis long-term care for seniors.  Contact us for your initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

Valid challenges to a Florida will

In order to challenge a Florida will, it may be necessary to prove that the person making the will — the testator — lacked what is known as testamentary capacity. In other words, that the person making the will lacked the ability to understand the consequences the will at the time it was created.

Adults over the age of 18 are presumed to have testamentary capacity. Some of the ways to prove a lack of testamentary capacity include:

The testator was senile, suffering from dementia, had a substance abuse problem or was mentally ill at the time the will was drafted and signed.

The testator did not understand the value and extent of his or her property.

The testator does not have a close relationship with the beneficiaries of the will.

The testator does not understand what the provisions in the will mean.

The testator does not know the value of the property included in the will.

Additional challenges to the validity of a Florida will can include:

Undue influence, forgery or fraud. It is not uncommon for challenges to a will to charge that the will was procured by undue influence, forgery or fraud. This is especially true if the testator is elderly when the will is created.

Discovery of a newer will. If a newer will is discovered, it can trump an older will. If you are updating your will, it is important to state that it invalidates all previous wills and the old will should be destroyed.

Witnesses. Florida law requires that a will be signed in the presence of two independent witnesses who are not named in the will as beneficiaries. If a will lacks the necessary number of witnesses, or is witnessed by someone who stands to benefit from the provisions in the will, it may be found invalid.

At The Estate, Trust and Elder Law Firm, P.L. we help our Treasure Coast clients develop and implement comprehensive estate planning strategies personally tailored to their unique situation, needs, and goals. Contact us for your initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

Estate planning tools to avoid guardianship

When a person becomes incapacitated, either mentally or physically, and needs legal protection, it is often necessary to go through the court system to have a guardian appointed – that is, unless you utilize some useful estate planning tools in advance to eliminate the financial and emotional pain of this burdensome legal procedure..

 Guardianship is a legal proceeding whereby a court appoints someone (the guardian) to become responsible for exercising all the legal rights of an incapacitated person, known as a “ward.”

The guardianship process can be difficult for many families, and can be avoided through careful estate planning; here’s how:

Advance medical directive – also known as health care power of attorney, this legal document lets you name someone to act on your behalf in case you become incapacitated and cannot make your own health care decisions.

Financial power of attorney – gives an agent you name the power to make financial decisions for you in case of your incapacitation. Financial powers of attorney can either be durable – meaning it goes into effect as soon as the document is executed – or springing, meaning the power of attorney only goes into effect if and when you have been declared mentally incompetent by a court or one or more doctors.

Revocable living trust – one of the most efficient ways to avoid guardianship is by establishing a revocable living trust, funding it with your assets and naming someone as disability trustee. You control the trust as long as you are competent; if you should become incapacitated (how this is to be determined should be spelled out), the disability trustee can take over and manage your assets for your benefit.

With the proper guidance, you can protect your finances and spare your loved ones the frustration of having to make costly and difficult decisions.  Contact us for your free initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

How to avoid probate with a life estate

There is one way that heirs can inherit real estate while avoiding the cost and hassle of probate: through the use of an estate planning tool known as a life estate.

A life estate is a deed that allows the real estate owner to remain in his or her home during their lifetime. Upon the owner’s death, the property passes directly to the heir or heirs named in the life estate, who only need to provide the court with a copy of the owner’s death certificate to take ownership.

With a life estate, the parent becomes the “life tenant” of the home, and the children are designated as “remaindermen.” Probate is avoided because ownership of the property transfers by deed to the remaindermen upon creation of the life estate, while the life tenant is still alive.

The life tenant still has responsibility for maintaining the property and making mortgage and property tax payments while still in the home, even though the parent and children are co-owners of the property. The children do not obtain sole ownership of the home until the life tenant dies; however, the ownership interests are still considered assets that could be attached by creditors for unpaid debts or awarded to an ex-spouse in a divorce.

If the life tenant decides to sell the home, he or she must obtain the permission of all remaindermen to do so or the children can return their interest in the home to the life tenant by consent. However, any remainderman can sell their interest in the property without the consent of the other owners.

Our experienced and trusted estate planning attorneys have been serving Treasure Coast families for decades, and Michael Fowler is one of only four Treasure Coast attorneys who is Board Certified by the Florida Bar in Elder Law. Contact us for your free initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

Five steps to ensure your estate plan meets your needs

Creating a comprehensive Florida estate plan is the first step in protecting assets for you and your family. But don’t stop there. Here are some tips to ensure your estate is properly organized:

If you have a safe deposit box, name a trusted co-owner of the box so your family can access it without having to get a court order. When you die, your Durable Power of Attorney dies with you, so your executor will not have immediate access to the box.

If you are in the habit of hiding valuables in your home, tell a trusted family member where those hiding places are.

If you use a name that is not your legal name on your bank account or other financial accounts – i.e., Bob Brown instead of Robert Brown – be sure that your alternate name is on your estate planning documents.

If a Florida resident passes away in another state, be sure their Florida address is noted when the death is reported. An out-of-state address on a death certificate can lead to problems at probate.

Be sure the person you have named as your executor or trustee is willing and able to serve. There are many instances when estate planning documents have not been updated, and a named representative has passed away or become disabled, requiring the court to get involved.

Although estates may be smaller after the economic downturn of the last few years, there’s now more room for flexibility, and if you play your cards right, more of your estate will end up going to your heirs rather than to the government.

So what does it mean to play your cards right?

Be specific about the distribution of your estate. Questions about your estate will inevitably lead to fights between family members. Being clear in your will or trust means fewer questions and fewer fights.

Build flexibility into your estate plan. A revocable trust as opposed to an irrevocable trust will give your executor more flexibility to manage assets when they need to be managed.

Reassess (and possibly re-title) how you hold your assets and plan to take advantage of the current exemption ($5.49 million per person, $10.98 million for couples.)

Make gifts now, rather than after you’re gone. Gifting while you are still alive can remove taxable assets from your estate, and since the estate tax exemption is so high, it’s a good time to give. You may also want to consider how much you can accomplish with a pen and checkbook, including paying tuition and medical expenses for your grandchildren with no tax consequences.

But the first thing you need to do is dust off your existing estate plan and take it to a Florida estate planning attorney for review. If you haven’t done so in awhile, it’s time to reassess, revise, and take control again.

At The Estate, Trust and Elder Law Firm, P.L. we help our Treasure Coast clients develop and implement comprehensive estate planning strategies personally tailored to their unique situation, needs, and goals. Contact us for your free initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

Do I need a will?

When your life changes, your will needs to change as well. You can do this by either modifying your will with a codicil, or by creating a new will. To eliminate any possibilities for confusion, you should consider drawing a new will when you experience a big life change such as:

Divorce – In most states, a divorce decree will nullify any gift made to a former spouse; however, to ensure your assets go where you want them to go, you should draw up a new will following a divorce.

Marriage – No matter if it’s your first marriage or your fourth, you and your new spouse should both create a new will. If there are now stepchildren you want added as beneficiaries, you will need to provide for them by name in your will, unless they have been adopted, in which case they will be considered your legal children.

Birth – Your will should include the establishment of a guardian for any minor children.

Death – If you have named someone as a beneficiary in your will and they before you do, a new will should be created so the assets can be redistributed.

Reviewing your will when life changes – such as a birth, a death, or divorce – will help ensure your will is valid and does what you intend for it to do. Here are some other things you can do to ensure your Florida will is valid:

Make sure it can be found. A common mistake many people make is to lock away their will in a bank safety deposit box, not realizing that it will require a court order to open that box and your loved ones will be without the necessary documents to open probate.

Be careful about who you choose as executor. Naturally you want to name someone who is responsible, but be sure they actually want the job before you name them. In addition, name a second person to serve in case your first choice is unavailable.

Avoid contradictions in estate planning documents. You want to be sure your will doesn’t contradict the choices you have already made for those listed on beneficiary forms for your life insurance policy, retirement accounts, etc.

Name a back-up guardian. One of the most important functions of a will is naming a guardian for minor children. But what if you only named one person, and that person couldn’t take on the responsibility? Naming a second choice for guardian will bypass this potential problem.

Be specific. If you want to disinherit someone, you must state that specifically in your will. In addition, if you have gotten divorced and remarried but have children from your first marriage, you will want to make provisions for both your current spouse and your children from the first marriage. Not doing so could leave your children unintentionally disinherited.

Seek professional guidance. While there are many online options for creating a will, these are not tailored to your specific needs. Seek professional guidance from a qualified estate planning attorney so you can avoid common mistakes that could invalidate your will.

Our experienced and trusted estate planning attorneys have been serving Treasure Coast families for decades, and Michael Fowler is one of only nine attorneys in the state of Florida who is double board-certified in wills trusts and estates and in elder law. Contact us for your initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

Do All Florida Wills Have to Go Through Probate?

Do All Florida Wills Have to Go Through Probate?Most people think that if somebody dies with a will, getting their inheritance will be fairly simple and easy. However, if a person dies in Florida with or without a valid will, the estate still may be required to go through probate depending upon how particular assets are titled.

Probate is the court-supervised method by which the will is validated, heirs are determined, debts are paid and assets are distributed. If no will exists – also known as dying “intestate” – probate is necessary for a judge to determine who will receive the deceased person’s assets under Florida Law unless they are titled in a probate avoidance format.

While Florida law clearly states that a surviving spouse with no children will be the sole beneficiary if no will exists, things can get very complicated after that. Even if there is a will, the court still needs to ensure that the will is valid and that there is no conflict between the will and Florida law, especially when homestead property is involved.

Either way, you will need the assistance of a skilled attorney to help navigate this process since the State of Florida does not allow do-it-yourself probate.

When you are already grieving the death of a family member, the complicated demands of the Florida probate process can be overwhelming. This is why the easiest course of action for your family is to consult with a probate attorney, who can help you navigate this process so you don’t have to go it alone.

The Estate, Trust & Elder Law Firm, P.L., provides attorney services ranging from estate planning for young families to advanced and crisis long-term care for seniors. Contact us for your initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.

How Succession Planning Helps Floridians Avoid Probate

How Succession Planning Helps Floridians Avoid ProbatePart of savvy estate planning in Florida might include making sure your assets are set up with “right of survivorship” or POD (pay on death) designation (also called “succession planning”) in order to avoid probate entirely.

Some common examples of this include:

An insurance policy or annuity is not subject to probate if it is payable to a specific beneficiary. However, if the policy is payable to the deceased, Florida considers it part of the estate.

If there is a joint bank account or investment and the account includes right of survivorship, the account automatically goes to the surviving owner.

If real property is titled as “joint tenants with right of survivorship,” it is not considered a probate asset. If the real estate is titled as “tenants in common,” Florida considers it a probate asset unless it is a “homestead property” – more commonly known as a primary residence. For example, an investment condo in Fort Meyers that provides rental income could be a probate asset depending on the title’s language.

Property jointly owned by a husband and wife as “tenants by the entirety” is not a probate asset and goes directly to the surviving spouse.

Assets placed into a properly drafted and fully funded Florida Living Trust can pass directly to the named beneficiaries without court supervision.

Those are just a few examples of property that can become probate assets in Florida. An attorney experienced in Florida wills, trusts, estate planning and asset protection can answer your specific questions.

With the proper guidance, you can protect your finances and spare your loved ones the frustration of having to make costly and difficult decisions.  Contact us for your initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.