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Estate Planning

Estate Planning, Probate and Guardianships

Are you prepared?

The firm’s Trust and Estates practice provides guidance to clients through the complexities of planning a will or trust. We are sensitive to the fact that this process often evokes anxiety and emotion. We strive to inspire the utmost confidence to everyone involved. Our team soundly anticipates potential problems in probate matters and use our experience to develop an estate plan which minimizes probability of those problems arising.

Also, if someone you know is mentally or physically incapacitated due to minority, senility, unconsciousness, or other impediment, our firm has the knowledge and experience to assist our clients in establishing a guardianship case for that individual to manage that person’s affairs.  There are varying degrees of control which a court-appointed guardian may be given over the ward (the incapacitated person), depending on the level of competency.

We also work closely with other professionals, such as physicians, accountants, bankers, and other attorneys around the community which require expertise in unrelated areas.

Our attorneys are admitted to practice before Florida’s probate courts in both uncontested administration of estates and adversarial proceedings.

 

Wills

A Will is a written communication by which a person directs how his or her estate is to be distributed upon death.  The estate consists of property that one leaves behind after death.

Most people do not appreciate the importance of an effective estate plan, particularly when it comes to putting your final wishes in writing in the form of a will.  Some of the reasons include the belief that one’s estate is too small to justify the time and expense of preparing one, the thought of one’s mortality, and even people who recognize the need for a will often don’t have one, perhaps to due procrastination or a disinclination to breach the sensitive subject with loved ones.  The truth is, almost everyone should have a will.  Here are a few of the many reasons why:

First, creating a will allows you to choose the beneficiaries of your estate.  Without a will in pace, the intestate succession laws of the state in which you live determine how your property will be distributed.  For instance, property of a married person with children who dies intestate (without a will) is generally distributed entirely to the surviving spouse or between the spouse and children, depending on whom the decedent (the deceased loved on) had the children (if any) with.  The property of an unmarried, childless person who dies intestate generally gets distributed to his or her parents (or siblings, if parents are deceased).  If no next of kin is found, the property will go to the state (escheat).

These distribution schemes may be contrary to what you want.  In effect, by not having a will, you are allowing the state to choose your beneficiaries.  Further, a will allows you to specify not only who will receive your property, but how much each beneficiary will receive.

Second, having a will may minimize tax exposure.  Many people feel they do not need a will because their taxable estate does not exceed the amount allowed to pass free of federal estate tax. These assumptions, however, should be reviewed given the current state of change in the federal estate tax laws. It is important to review and update your will on a regular basis. Most wills were written with the existence of a federal estate tax at a certain level.

Further, your taxable estate may be larger than you think. For example, life insurance, qualified retirement plan benefits, and IRAs typically pass outside of a will or estate administration. But retirement plan benefits and IRAs (and sometimes life insurance) are still part of your federal estate and can cause your estate to go over the threshold amount. Also, in some states, the estate or inheritance tax differs from the federal laws. A properly prepared will is necessary to implement estate tax reduction strategies.

Third, a will allows you to appoint a guardian for minor children.  If for no other reason, you should prepare a will to name a guardian for minor children in the event of your death without a surviving spouse. While naming a guardian does not bind either the named guardian or the court, it does indicate your wishes, which courts generally try to accommodate.

Fourth, a will names the personal representative (executor) of your estate.  Without a will, you cannot appoint someone you trust to carry out the administration of your estate. If you do not specifically name an executor in a will, a court will appoint someone to handle your estate, perhaps someone you might not have chosen. Obviously, there is peace of mind in selecting an executor you trust.

Last, but not least, creating a will allows you to establish your domicile.  You may wish to firmly establish domicile (permanent legal residence) in a particular state, for tax or other reasons. If you move frequently or own homes in more than one state, each state in which you reside could try to impose death or inheritance taxes at the time of death, possibly subjecting your estate to multiple probate proceedings. To lessen the risk of this, you should execute a will that clearly indicates your intended state of domicile.

If you need guidance with your will, just give us a call.

Trusts

What is a trust?

A trust is a legal entity that is treated under the law as a person that can own assets, whether it be money or even real property. The trust is similar to a will in the sense that a trust includes instructions for the person(s) you have named to administer the trust (a “trustee”) and who you want to receive your assets after you pass (“beneficiaries”). There are a variety of trust that exists, but the most common forms of trust encountered are:

  • Testamentary Trust: a trust created in a will after someone dies;
  • Irrevocable Trust: a trust established during the lifetime of the trustmaker that can usually not be changed; and
  • Revocable Trust: a trust established during the settlor’s lifetime and usually becomes irrevocable upon the death or incapacity of the settlor.

Trusts differ from wills in that they are exempt from the probate process (the process of proving a willing court) so long as the trust is properly funded (assets titled to the trusts). Wills, too, can be modified or revoked by the testator (the willmaker) but are subject to the jurisdiction and rules of the probate court upon the death of the testator. Additionally, trusts tend to be more flexible. A living, competent settlor may change a revocable living trust document as he or she wishes, including amount of assets in the trust or how the assets shall be distributed, and can even revoke the trust altogether.

Who are the parties involved?

–        A settlor (also known as a grantor, trustor, creator, or trustmaker) is the person who establishes the trust. Married people may jointly establish a trust and are considered “co– settlers” of their joint trust. Only settlers can make changes to the trust.

–        The trustee manages the assets are in the trust. Once a trustee accepts designation, he or she receives the property and/or assets to be put in trust from the settlor and the trust is created. Almost any competent individual over the age of 18 can be a trustee, even the settlor! A successor trustee may be named if the original trustee is no longer able to continue to serve as trustee (usually due to incapacity or death) and, typically, several successor trustees are named in succession in case one or more cannot act.

–         Beneficiaries are the persons or organizations who will receive the benefit of the trust assets after the settlor dies.

What do I do if I am appointed as a trustee?

Now that you have been appointed trustee, here are a few things you should know:

  • you must know where the original trust document, trust assets, insurance policies and other important papers are located;
  • make sure appropriate titles and beneficiary designations have been changed to the trust; and
  • you need to know who the trustees are currently, if any, and any potential successor trustees.

The most important thing to remember when you step in as trustee is that the trust assets are not your assets.  You are entrusted with the assets for the benefit of others and you are safeguarding them for the settlor (if living) and the beneficiaries who will receive them after the settlor dies.

As trustee, you have certain duties and responsibilities, including:

  • you must follow the instructions in the trust document;
  • you cannot mix or commingle trust assets with your own – you must keep separate checking accounts and investments to be able to account for them;
  • you cannot use the trust assets for your own benefit (unless otherwise authorized by the trust);
  • you must treat trust beneficiaries the same – you cannot favor one over another (unless otherwise authorized by the trust);
  • trust assets must be invested in a prudent (conservative) manner (“prudent investor rule”)  – in a way that will result in reasonable growth with minimum risk; and
  • you are responsible for keeping accurate trust accounting records, filing tax returns and reporting to the beneficiaries as the trust requires, or as required by the Florida Trust Code, among other things.

Luckily, trustees are entitled to reasonable compensation for their services! Refer to the trust document or the Florida Trust Code.

If you would like to discuss the best estate plan for your needs, just give us a call.

Pre-Need Guardian for Yourself and Children

In the event you become incapacitated and you do not have an effective durable power of attorney or other advanced directive, you may be subjected to a guardianship proceeding where the court appoints a guardian to manage your affairs and finances.  There are many tools to help you plan in the event you become incapacitated and can no longer manage your own affairs.

Additionally, in the event you die without a surviving spouse and with minor children, your will or Declaration for Pre-Need Guardian for a Minor can advance your wishes as to whom you entrust with your children.

*Declaration of Pre-Need Guardian

The Declaration of a Pre-Need Guardian is a written document, pursuant to Section 744.3045, Florida Statutes, (See below) which states your preference for a guardian of both you and your property if you should become incompetent to manage your own affairs. It is a formal statement and is filed with the Clerk of Court in your county of residence. The declaration must be signed by you in the presence of two attesting witnesses. The Clerk of the Court will produce the declaration if and when a petition for incapacity is filed. The first choice of guardian in Florida is your preference if it can be proven; if not the courts will appoint a blood relative. This creates a presumption that your nominated pre-need guardian is entitled to serve as your guardian. You can then have peace of mind knowing that if you become incapacitated someone you know and trust will take care of you.

*Declaration of Pre-Need Guardian for a minor

The Declaration of a Pre-Need Guardian for a minor is similar to the Declaration of a Pre-Need Guardian in that it is a written document, pursuant to Section 744.3046, Florida Statutes,(See below) in which you designate someone to become your children’s guardian, if you ever become incapacitated. A Court is bound to appoint the person named in the Pre-Need Guardian for a minor, especially when the document is filed with the Clerk of Court. This document, generally, will not deny a natural parent their right to be a custodian.

Asset Protection

What alternatives are there to probate? It is one of the questions most frequently asked when considering an effective estate plan, with good reason — probate administration and, potentially, litigation, can be very expensive and time consuming. The larger and more complex the estate, the longer it takes to administer the estate resulting in higher legal fees.

There are several ways to avoid probate. However, the avenues to do so all have one thing in common – assets are arranged so that there is nothing in the decedent’s name at the time of death. For instance, joint tenancies, life estates in property, beneficiary designations (i.e., payable-on-death or transfer-on-death), and living trusts.

Assets in the categories listed above are not considered to be probate assets and automatically transfer ownership by operation of law upon the passing of the decedent. If all of the decedent’s assets are non-probate assets, the entire estate would pass automatically to the designated beneficiary.

However, these techniques to avoid probate have their challenges, including tax consequences and limiting control of the asset (i.e., a home in the name of joint tenants would require consent of both tenants/owners to sell the property in the event the property would need to be sold for emergency funds).

Trusts are also a common and effective way of avoiding probate. See our Trust page for more, in depth information on the instrument.

Make an appointment with us for a consultation to further discuss your situation and options when it comes to an estate plan.

Powers of Attorney

The Power of attorney is a written document where a principal (the person giving authority) gives an agent or attorney-in-fact authority to act on the principal’s behalf in private affairs, business, or some other legal matter.  A power of attorney must be signed by the principal, two witnesses and notarized.  There are a few types of these documents with varying degrees of authority bestowed upon the attorney-in-fact.  As with all powers of attorney, the attorney-in-fact is obligated to either act in accordance with specific instructions given to him or her by the principal and/or in that person’s best interest in mind; and if the attorney-in-fact is making independent decisions on behalf of the principal, he or she must think carefully about the situation and be certain he or she could justify any decisions made on behalf of the principal.

*Durable Power of Attorney

A Durable Power of Attorney is a power of attorney where the principal authorizes an attorney-in-fact to act on behalf of the principal.  The Durable Power of Attorney is a special power of attorney in that the authority it grants an attorney-in-fact remains in effect even if the principal becomes mentally incapacitated.  For obvious reasons, this Durable Power of Attorney must be executed before the principal becomes mentally incapacitated, if at all.

The powers granted by a Durable Power of Attorney end when the principal dies or, if still mentally competent, revokes the power from the attorney-in-fact.

*General Power of Attorney

A general Power of Attorney is similar to the Durable Power of Attorney (link) in that a principal authorizes an attorney-in-fact to act on behalf of the principal.  However, it differs in that the power ends upon the death of the principal or upon the principal becoming incapacitated.

*Limited Power of Attorney

A limited power of attorney is a written document where a principal grants an attorney-in-fact authority to act on the principal’s behalf on a limited basis or for a particular event.  For example, a principal may have to leave town on the same day that he or she is scheduled to close on a property.  To avoid having to reschedule the closing, the principal may execute a limited power of attorney for the attorney-in-fact to act on the principal’s behalf only for the purposes of the closing.  Limiting the power avoids the potential abuse of power and restricts what an attorney-in-fact can and cannot do on behalf of the principal.

Advanced Health Directives

Estate planning is not limited to the execution of wills or trusts.  The Florida Legislature found that every competent adult has the fundamental right to self-determination regarding decisions relating to his or her own health, including the right to choose or refuse medical treatment.  To ensure that such a right is not lost or diminished by virtue of incapacity, whether mental or physical, certain procedures are in place to allow a person to plan for such incapacity by executing a document designating another person to direct the course of his or her medical treatment.  Fortunately, even if one did not have these documents in place, Florida Law provides for a health care proxy to make health care decisions on behalf of the incapacitated individual.  You can find the order of preference of this proxy here or Florida Statute 765.401.

The two most common documents are living wills, health care surrogates, and a HIPAA Release Authorization.

If you would like to discuss your options with respect to these estate planning documents, give us a call to make an appointment to speak with our experienced estate planning attorneys.

Living Wills

A living will is a statement of your wishes for the kind of life-sustaining medical intervention you want, or don’t want, in the event that you become terminally ill and unable to communicate.  A living will is typically used by people to identify the point at which they no longer desire certain types of life-prolonging medical treatment.

Living wills are very important legal documents with legal power. Assuming the proper procedure has been followed, a patient’s wishes are taken very seriously, and a living will is one of the best ways to have a say in your medical care when you can’t express yourself otherwise.

Once your living will has been drafted, make sure it’s signed and on file with your estate planning attorney. You should also provide a copy to:

  • your regular physician;
  • Family members;
  • close friends;
  • the medical records department of the hospital you’re likely to visit; or
  • if you are in a nursing home or are seeing a medical specialist, they should get a copy as well.

Finally, you can put a card in your wallet that says you have a living will and whom to call to get a copy.

If you would like to discuss your living will, give us a call to make an appointment.

Health Care Surrogate

A Health Care Surrogate can be any competent adult who has been given authority to make all health care decisions on behalf of the principal during the principal’s incapacity.  In the absence of a living will, the surrogate can make decisions to withhold or withdraw medical treatment.  The Surrogate must be satisfied that principal will not regain capacity so that they can exercise that right and that principal has an end-stage condition.

The document appointing a health care surrogate must be:

  • in writing;
  • signed by the principal (person designating the surrogate) in the presence of two witnesses, or, if the principal is physically unable to sign the instrument, the principal can direct one of the witnesses to sign it in the presence of the other;
  • designated surrogate cannot be a witness;
  • exact copy of the instrument must be provided to surrogate;
  • at least one of the witnesses shall not be the principal’s spouse nor blood relative.

The surrogate’s authority shall commence when the attending physician enters into the principal’s medical record that the principal does not have the capacity to make informed health care decisions.  If there is a question as to capacity, a second physician shall also evaluate.  Authority remains in effect until a determination that the principal has regained his or her capacity.

If you have a surrogate you would like to appoint to make decisions about your medical treatment and would like to have something in writing, give us a call to make an appointment to discuss your options.

HIPAA

HIPAA’s (the Health Insurance Portability and Accountability Act of 1996) purpose was to provide consumers with greater access to health care insurance, provide privacy to health care data, and provide national standardization and greater efficiency in the health care system.

The act prohibits your health care providers from releasing your health care information unless you have provided your health care provider with a HIPAA release form.

Unless you have provided a signed release form, your health care providers are prohibited from discussing any aspect of your medical information with anyone who is not directly involved in your care.

If you have questions or would like to discuss a HIPAA release form, give us a call to make an appointment.

Health Care Proxy

A Health Care Proxy comes into effect where an incapacitated individual or developmentally disabled patient has neither executed an advance directive nor appointed a surrogate to execute an advance directive or the designated or alternate surrogate is not available to make medical decisions.

The order of priority for proxy candidates is as follows (see Florida Statute 765.401):

  • Court appointed guardian;
  • Patient’s spouse;
  • Patient’s adult child or the majority of adult children reasonably available for consultation;
  • Adult relative who has exhibited special care and concern for the patient, who has maintained regular contact with the patient, and who is familiar with the patient’s activities, health, and religious or moral beliefs;
  • Close friend; or
  • Clinical social worker licensed pursuant to Chapter 491 of the Florida Statutes, or who is a graduate of a court-approved guardianship program.
Probate Administration

When a person dies, his or her assets will not necessarily be distributed automatically to those entitled to them.  The probate process is a court-supervised proceeding that allows a deceased person’s (a “decedent”) assets to be distributed to named beneficiaries in a will (testate) or heirs at law if there is no will (intestate).

Depending on the circumstances, there are different kinds of probate proceedings.  However, the issues in and around the probate arena can be extremely complex and usually require the assistance of a probate attorney.

There are three basic types of proceedings to administer a decedent’s estate and the one used depends o the size of the decedent’s estate:

1)    Formal Administration:  this process is used when there are considerable assets and it is necessary to appoint a personal representative to act on behalf of the estate (i.e., sale of a property, liquidating of stocks, dealing with creditors of the estate, etc.).

2)    Summary Administration:  this process is used when the value of the entire estate does not exceed $75,000.00 or when the decedent has been dead for more than two years.

3)    Disposition of personal property without administration:  this process is used to request release of decedent’s assets to the person who paid for final expenses, such as funeral bills or medical bills that accrued in the last 60 days.

As mentioned before, going through the probate process can be a frustrating and daunting experience for the inexperienced.  The best thing to do is to hire an estate planning or probate attorney to assist you with the administration, especially if there is potential for litigation (i.e., will contest, elective share, etc.).  Give us a call to discuss your situation; we are happy to help.

Testate

If the decedent dies with a will, the custodian of the will must deposit the original will with the clerk of the court immediately.  The custodian of the will must deposit the original will with the clerk of the court in the county where the decedent resided (domiciled).

Once probate is opened, and the appropriate proceeding has been selected, the court proceeds with the probating of the will.  The will usually provides for the appointment of a personal representative (executor) of the estate, which must file documents and petitions to admit the will to be probated.  The personal representative is charged with settling and distributing the estate’s accounts and assets, respectively, in accordance with the terms of the decedent’s will and must do so as expeditiously and efficiently as is consistent with the best interest of the estate.

After satisfying any claims from creditors and distribution the remaining assets to the beneficiaries, the personal representative is discharged from his or her duties.

Intestate

Intestate proceedings may be necessary to distribute the decedent’s assets if the decedent died without a will.  Probate proceedings are initiated by filing a petition seeking to administer the decedent’s estate.  A filing fee is also required.  The decedent’s assets will then be distributed to heirs at law according to the Florida Statutes.

Probate Litigation

Will contest

Under Florida law, a will (link to “Wills”) must be properly drawn and its provisions regarding the disposition (probate)(Link to probate) of the decedent’s assets must be followed.  However, this process is not always as smooth and easy as one may think.  There are different instances in which a will may be challenged, including:

  • Undue influence
  • Fraud
  • Lack of Capacity
  • Forgery
  • Improperly executed will
  • Duress

Allegations of the foregoing in the creation of a person’s will often come in the later stages of a person’s life, when the person is susceptible and vulnerable to such actions.  Family members, caregivers, or friends may cause a person to amend a will or create a new will through improper influence or may actually forge a new instrument.

Disputes can also arise throughout the probate proceedings, such as a personal representative not carrying out the wishes of the decedent or improperly handling the estate.

The firm’s probate litigation practice will investigate all facts and circumstances around the case, using experts and professional investigators if necessary.

Elective Share

The elective share provision of the Florida Statutes derive from the legislature’s intent to provide for protection for surviving spouses and children in the event of a family’s primary “breadwinner”.  To that extent, an elective share allows a surviving spouse to receive up to 30% of a decedent’s estate if he or she is not satisfied or stands to receive less than 30% of the estate under the terms of the decedent’s will.

A surviving spouse has six (6) months from the date of publication of the estate or two (2) years from the date of the decedent’s death to make an elective share claim.

Elective share issues, such as property entering the elective estate and the valuation of that property, are quite complicated.

Whether you are pursuing or defending an elective share claim, our attorneys are prepared to assist you in your case.  Call our office to make an appointment to discuss your case.

Lost Wills

This is a fairly common occurrence. Many people go through the trouble of drafting a Last Will and Testament, but then they put it in a “safe place” where no one can find it. There is a legal process to allow probate of a photocopy of a Will where a witness to its signing swears that it is a true and correct copy of the original Will. Or, the court-appointed personal representative of the estate may go to each bank where the decedent may have done business and inquire as to whether there is a safe deposit box under the name of the decedent.

Of course, if no Will can be found, then the court will be at a loss to apply the desires of the person who wrote the lost instrument. Florida law has specific legislation (Florida Statute Sec. 732.101-732.103) as to how a deceased person’s assets are distributed to heirs when the decedent left no Last Will and Testament.

Give us a call today to discuss your case with us.  Our attorneys have the knowledge and experience to develop the strongest possible case on behalf of the beneficiaries/heirs or the personal representative of an estate.

Guardianship Administration

When an individual (a “Ward”) cannot take care of himself or herself, a court may appoint a guardian to take care of that person and/or that person’s affairs. A legally incapacitated individual is a minor or an adult who is impaired by reason of mental illness, mental deficiency, physical illness or disability, chronic use of drugs, chronic intoxication, or other cause to the extent that he or she lacks sufficient understanding or capacity to make or communicate informed decisions. A guardian has the powers and duties stated in Florida Statutes section 744.361. The Ward retains the rights stated in Florida Statutes section 744.3215.

The extent of authority that a guardian has in handling the affairs of the ward depends on the type of guardianship. There are three types: guardianship of the person, guardianship of the property, and guardianship of the person and property. The court may appoint the type of guardianship it deems appropriate considering the level of incapacity of the ward. Click here (link to guardianship faq) to see a more in depth look as to the inner workings of a guardianship proceeding.

Guardianship is only warranted when no less restrictive alternatives, such as a durable power of attorney, a trust, a health care surrogate or proxy, or another form of pre-need directive, are found by the court to be appropriate and available.

The best thing to do when facing a situation where the services of a guardian may be needed is to contact an attorney. Give us a call to discuss your situation.