Estate Planning

Preparing for the First Meeting

We will have a more focused discussion at our initial meeting if we have specific information on your current situation. Therefore, please fill out the questionnaire below and return it in the enclosed envelope at least 5 days prior to our first meeting. If you have questions regarding something on the form, we can answer your questions at the appointment.

Estate Planning - Prepare for Your First Meeting
Download the Form (Word Doc)

Single Estate Planning - Prepare for Your First Meeting
Download the Form (Word Doc) or Fill out the Online Version

What to Bring:

It is also helpful if you provide copies of the following items prior to or at the initial meeting:

• A copy of your current will(s) or trust(s), if you have one, and copies of any other existing estate planning documents, and pre and post nuptial agreements.
• Copies of any deeds to real estate, a recent property tax statement and any mortgages on the property.
• If anyone owes you money, copies of those documents.
•  If you own a business, copies of any partnership or buy-sell agreements.
• The completed questionnaire (if you did not previously return it) or at least a basic statement listing assets and debts and showing who owns the asset and who any beneficiaries are.

This information will allow us to determine how to properly advise you on potential tax, probate, incapacity, and nursing home issues. We can then discuss methods of planning to preserve your assets for your heirs.

What Happens at the Initial Consultation

At the initial meeting we will discuss your individual situation and your goals. I will then apply a variety of laws to your situation and recommend estate planning steps that will accomplish your goals. All information necessary for preparation of your plan is then provided, and a written statement of total cost for your estate plan is given to you prior to the time you decide whether you want to authorize work to be completed. If a written statement of exact cost cannot be given due to
the need for more information from you, the written statement will be provided as soon as all information is received and before work is authorized.

What Happens after the Initial Consultation

One to two weeks after the initial appointment, drafts of the documents you requested we prepare are mailed to you for your review. If there are any changes to be made you will contact our office so those revisions can be done. If everything meets with your approval, you will contact us to schedule an appointment for the execution of your estate planning documents.

Questions which arise after receipt of the drafts of your estate planning documents are answered in a scheduled phone conference. At the second meeting, you are prepared to sign all documents. The estate plan is then complete.

Guardianship

We will have a more focused discussion at our initial meeting if we have specific information on your current situation. 

Types of Trusts

Testamentary

A Testamentary trust is often used when parents want to be sure their minor children are taken care of in the event of a catastrophe. Sophisticated estate planning documents are not really necessary at this point, ie., each spouse wants to leave their estate to the other, but they know that it would be more complicated should they die leaving young children. Typically a will is prepared with a set of provisions built into it allowing for the transfer of assets into a vehicle that would be used to care for these children until they are old enough to handle their own affairs.

Revocable/Living (“Wink Wink”)

Revocable trusts are one of the best tools that estate planning attorneys use in Florida. This trust, also called a “living” trust, is a great way to avoid probate, retain privacy from the prying eyes of Courts, relatives, and creditors, and save money at your death.

A Revocable trust, or Living trust, looks, feels and acts as if your assets are owned like they are currently held. However, upon the creation and “funding” of such a trust, the assets are titled in a new entity, eliminating ownership in your individual name. Therefore, avoiding probate.

You wear several hats under this type of trust: you are

• the “grantor” - the person granting or giving the assets to the trust;
• the “trustee” - the person in charge of managing the assets; and
• the “beneficiary” - the person entitled to all of the assets.

Because the trust is “revocable”, you have the right to amend any provision of the trust or terminate the trust entirely. Further, because the trust is revocable, there are no income tax effects. Your Social Security number is used in reporting all income, reportable on your individual income tax return, the Form 1040. When you receive tax forms from your various financial institutions at the end of the year, the statement will reflect “Your Name, Trustee” instead of just “Your Name”. You file the same tax return each year, and for the most part, there is very little difference once the assets are retitled into the trust.

Upon your death or disability, a successor trustee steps into your shoes. No Court intervenes. This is a person or persons that you have selected.

Irrevocable (total loss of control)

Special Needs (autistic, dementia, disabled)

Revocable trust

Each of you would establish a revocable trust. A revocable trust or revocable living trust, looks, feels and acts just like you own the assets as you do now. However, upon the creation of such a trust, your assets are transferred into a new entity, eliminating ownership in individual name (requiring probate). You wear several hats under this trust: you are

• the “grantor” - the person granting or giving the assets to the trust;
• the “trustee” - the person in charge of managing the assets; and
• the “beneficiary” - the person entitled to all of the assets.

Because we would be creating two separate trusts, each of you would serve as Trustee of your trust. We discussed the possibility of having John Smith act as the successor, should you be unable to serve. The beneficiaries of each trust would be both of you.

Upon the death of the first spouse (we are going to use Jeff for ease of explanation), the surviving spouse (Virginia) would have control of all of the assets in her trust, and have the “use” of the assets in the Jeff’s trust for her lifetime. When Virginia dies, the balance in her trust would be distributed to Joseph, and the balance of Jeff’s trust would be distributed to Leanne.

Because the trust is “revocable” you have the right to amend any provision of your trust or terminate your trust entirely.

Further, because the trust is revocable, there are no tax effects. Your Social Security number will be used in reporting all income. So when you receive tax forms from your various financial institutions at the end of the year, the statement will reflect “Virginia Paris, Trustee” instead of “Virginia Paris” and “Jeffrey Paris, Trustee” instead of “Jeffrey Paris”.

You will file the same tax return that you do now, and for the most part, you will see very little difference once the trust is funded with your assets. If you file a joint tax return, you will continue to do that as well.

Trustees

The trustee’s job is to manage the trust as you are managing your assets now, pay your expenses, and on your death, a successor would come in to pay all of your expenses and distribute your assets according to the provisions of the trust.

Distribution Plan:

Keep in mind as I discuss distributions below, that these events occur only after you are gone. As discussed during the meeting, upon your death, your Trustee would disburse your trust assets (tangible, real property, and intangible).

Types of Probate

Formal Administration (Traditional)

• Required when the assets of the estate exceed $75,000;
• When the decedent has been deceased for less than two years;
• When there are unpaid creditors or complicated asset structures;
• Personal Representative appointed and Letters of Administration issued;
• Example: Estate valued at $250,000; deceased dying 10/1/2017

Summary Administration (Abbreviated)

• May occur if assets of the estate are less than $75,000 or consist only of exempt assets
  (homestead, automobile, personal effects);
• When a decedent has been dead for more than two years;
• Beneficiaries or heirs of estate act as informal personal representative
• Example: Homestead property, bank account of $12,000

Disposition Without Administration (No Probate)

• When decedent has few assets;
• When final expenses (funeral and last illness) exceed whatever assets decedent had;
• Payor of expenses is entitled to reimbursement upon presentation of proof of payment
• Example: Stock account of $4,000; funeral bill of $8,000

Claims of Creditors of Decedent

• No individual is responsible for the debts of a decedent unless they have chosen to be
• Personal Representative publishes a Notice to Creditors in a local business newspaper, giving creditors certain amount of time to file claim;
• Florida Statutes determines which creditors are paid first, if not enough assets in estate;
• Personal Representative authorized to negotiate claim;
• Personal Representative may object to claim if there is a legitimate basis for objecting.

Ancillary Administration (Assets in Florida, Decedent Not a Florida Resident)

• Similar to Formal Administration in that Personal Representative must be appointed;
• Letters of Ancillary Administration issued;
• Same duties and responsibilities as Personal Representative as it relates to FL property;
• Documents from domiciliary estate (home State of decedent) are required to begin Ancillary Administration in Florida;
• Domiciliary Executor usually appointed as personal representative, if qualified; otherwise court will appoint a new personal representative;
• No need to be present in Florida unless contest arises
• Example: NY decedent Snowbird owned Condo in Miami Beach