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The Risks and Rewards of Home Equity Investments

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Imagine being able to tap into the equity of your home without any payments or interest.

It sounds too good to be true, right?

In today’s financial marketplace, there are options for just about everything, and a growing new form of financing called home equity investments or home equity contracts does just that.

With these contracts, a company provides the homeowner a payout that is paid back in 10 or 30 years or if the home is sold. There are no payments before then. You aren’t charged interest. Instead, you are required to pay an amount dependent on the appreciation or depreciation of the value of your house.

Much like anything in the financial realm, there are pluses and minuses to HEIs, but as estate planners, we’re reluctant to see our clients commit significant sums of money that will need to be paid right when retirement starts or years after.

The attorneys at The Orlando Law Group can help look at all options of a home equity investment and help advise you on your short-term and long-term obligations, along with how it fits with your current estate planning.

How Does This Work?

The nuts and bolts of a home equity investment are relatively simple.

Let’s say the current value of a home is now $500,000, and the homeowner decides to tap into the equity of the home to pay for a new pool. After all, like Clark Griswald found out in Christmas Vacation, the days of a company bonus paying for a pool are over.

Refinancing the home can be troublesome, especially if the homeowner’s credit is not stellar. Interest rates are high, and the homeowner really can’t afford an increase in their mortgage. Likewise, a home equity line of credit includes a new monthly payment, and interest rates are even higher, putting those outside the limits of the homeowner.

Paying with the credit from the pool company? Hopefully, you noticed the extremely high interest rates before signing up.

So, a home equity investment might work for that homeowner.

There are a few companies – backed by venture capital – that offer these types of payments. Those companies pay the homeowner a percentage of your current value, say 10 percent of your home. On the $500,000 home, they would give the homeowner $50,000 for that new pool.

When the homeowner goes to sell their home, or when the term of the investment ends, the homeowner must pay back 20 percent of the value of the home at that time.

Keep in mind, it is virtually impossible to know what that number may be until it’s due!

What could the payouts be for a home equity contract?

 The basis for the payback is entirely dependent on what the real estate market does in that specific location. If the value of your home increases, your payment increases. If the value of your home goes down, your payment will decrease.

However, in Florida, it is very rare to see home values decrease for an extended period of time. In fact, the average home value in the Orlando area in 2020 was just $269,000, and today, it is nearly $400,000.

Over a 10-year period, if home values increase by 10 percent a year, the homeowner could be required to pay back more than $300,000 with a 10-year term.

With a 30-year term, you could be facing a payment of over $3 million.

Of course, the odds of an annual 10 percent increase are not likely. But just an average 3 percent increase over 30 years could result in a payment of more than $350,000 in exchange for $50,000.

Compare that to a home equity line of credit at today’s interest rates. While a homeowner could have a $411 monthly payment on $50,000, the total paid over 30 years would only amount to around $150,000.

A home equity investment can be a substantial amount, so it’s important to be wary when signing up for a home equity investment.

Are these tools legitimate?

Yes, these tools are legitimate, however, they were facing increased scrutiny from the Consumer Financial Protection Bureau under President Biden.

At issue was whether they should be treated like a consumer financing option, similar to a mortgage or a car loan, or should they be treated like a financial investment, like securities or stocks.

Remember, when a homeowner signs a mortgage, it seems the paperwork is endless, including forms about discrimination, truth in lending and much more.

Currently, none of that applies to home equity investments.

We’re watching a few cases that might help provide guidance on these types of tools.

The government under the prior administration had provided an argument to one case that home equity contracts were a form of financing and should be treated as such.

You can read about that on an archived page found here.

Since taking office, the Trump Administration has taken down all warnings about these financial instruments from the CFPB’s website and has had its briefs in cases dealing with these instruments removed as well.

What happens if a homeowner can’t pay

For many people, this won’t be an issue. It is very rare for a home to depreciate, and often, people downsize when they retire. When those people sell their homes, the payment is included in the sale price.

If that $500,000 home increases in value 10 percent every year, at the end of 30 years, the home’s value will be over $6 million. Selling the home will easily cover the payout and still leave the homeowner with millions of dollars.

If that homeowner plans on staying in the home, that means a $3 million payment would have to come from somewhere else, which could be very difficult for many people.

At that point, if the homeowner could not pay, they would be forced to sell the home or have a foreclosure filed against them.

Neither of those options is great for an individual starting retirement.

That is why anyone thinking about entering into a home equity investment needs to work with their estate planning team to determine all the implications for their future.

The attorneys at The Orlando Law Group have helped clients throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida with their estate plans and can work with a team of advisors to ensure future finances are in place.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

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can power of attorney override a will?

Can a Power of Attorney Change a Will?

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When you’re not a lawyer, a lot of legal terms seem interchangeable. But knowing the ins and outs of wills, power of attorney (POA), and other concepts for wills and living wills puts you in a stronger position to defend the wishes of your loved ones—as well as your own wishes. The legal professionals at The Orlando Law Group want to empower all of our clients, and that includes helping local Florida residents like you understand the interactions between wills and power of attorney. Get the answers to frequently asked questions like ‘Can power of attorney change a will?’. 

Can a POA Sign a Will?

Someone designated with power of attorney cannot sign a will on behalf of someone else. They cannot create, sign, or revise a will without the individual’s consent and signature. However, the person given power of attorney does have some decision-making capabilities in how assets are handled and interpreted. Because of this, it’s important to create a detailed, legally sound will that thoroughly establishes what should be done with all of your assets.

Can Power of Attorney Override a Will?

Again, the direct answer to the question ‘Can power of attorney override a will?’ is ‘no’—but it can be more complex than that. If you give someone the power of attorney over your estate, they can make changes to those assets that can significantly alter how your will is carried out.

A power of attorney can also challenge a potentially invalid will, leading to part or all of the will not being enforced. This complication, however, is rare. In most circumstances, power of attorney also dissolves once an individual dies, as all of the assets and associated rights or responsibilities shift to the estate. Many people worry over the question, ‘Can a POA change a will?’ but wills have built-in protections against third-party changes.

Do I Need a Power of Attorney If I Have a Will?

These questions and answers have shown the strict division between wills and people granted power of attorney. In most circumstances regarding assets, wills overrule all other sources, and people with power of attorney have a diminishing impact on the assets. However, both concepts are very important to organizing your life and assets. “Power of attorney” is useful for protecting your assets while you’re still alive, while your will can protect your assets once you pass away. 

Someone granted power of attorney can handle these responsibilities: 

  • Make decisions for you, your health, and you’re assets if you’re incapacitated and/or medically unable to make those decisions for yourself
  • Represent you in the purchase or sale of assets that require in-person representation

You can even have multiple people granted power of attorney on your behalf, such as a finance POA and a health care POA.

Every state establishes its own rules regarding what ‘power of attorney’ entails and the process for establishing one. In Florida, only people aged 18 and older can have an agent with power of attorney (and that agent must also be 18 or older). They can handle responsibilities such as managing investments and real estate, paying bills and other debts, and looking after your business, as well as making health-related decisions. However, it is also best to establish a living will, which can detail your preferences regarding medical interventions, asset management, and other decisions. 

Contact The Orlando Law Group for All Your Legal Needs

No matter how old you are or how complex your estate is, it’s best to establish a will, living will, and power of attorney before you need them. Being proactive gives you more time to think through sensitive decisions and create a legal strategy you’re comfortable with. At The Orlando Law Group, we’re here to help. Contact us today to schedule an initial consultation or to learn more about your legal options in Florida.

Featured Image: Amnaj Khetsamtip / Shutterstock

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Staying Prepared: LGBTQ+ Estate Planning Tips for Changing Times

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With the new administration taking office in January, LGBTQ+ couples across the country are worried their legal marriages might lose their protections that were given in the Obergefell v. Hodges decision and the 2022 Respect for Marriage Act.

Before those decisions, LGBTQ+ marriage protections were a patchwork of state laws and had no federal protections. While some states allowed LGBTQ+ marriages with full rights, others only allowed civil unions or no protections at all.

In addition, the Defense of Marriage Act passed in the 1990s gave federal benefits to only marriages between a man and a woman.

While it is unlikely all of the recent protections will be overturned, it is essential to ensure your estate plans are up to date and clearly state what happens when you die just in case the worst-case scenario happens.

The attorneys at The Orlando Law Group have a long history of working with LGBTQ+ couples before the Obergefell decision and afterward to ensure their assets and wishes are protected regardless of the laws about same-sex marriage laws.

Before Obergefell

For decades, the United States has been working on how it treats LGBTQ+ couples who want to get married.

In the 1970s, after the Stonewall Riots in New York City, there were several key steps forward and backward toward building equality in marriage on a state and federal level.

But it was bleak for couples who didn’t establish estate plans that legally directed the division of assets after death. If there wasn’t a will or trust or any other type of tool for estate planning used, the courts would decide how the assets of the deceased were split.

In many states, including Florida, that meant the surviving member of the couple had virtually no rights to any of the assets if contested by the family of the deceased. It was truly heartbreaking to see story after story of LGBTQ+ individuals watching a lifetime of shared assets being taken away because of the hate of other family members toward the deceased’s lifestyle.

Perhaps even worse was if one person of the LGBTQ+ couple was incapacitated in the hospital. The other half of the couple had no rights unless granted by blood relatives.

However, a legally binding estate plan for LGBTQ+ couples was a way to clearly state to the court the intentions of the deceased and for medical care.

What did Obergefell do?

 Adding to the confusion was that some states – like Massachusetts and Washington – legally recognized an LGBTQ+ marriage whereas some states – like Florida and Wyoming – had statutes preventing LGBTQ+ marriage.

In a straight marriage, if you are married in one state, your marriage is recognized and validated in every state.

But that was not the case with LGBTQ+ marriages. Before Obergefell, if an LGBTQ+ couple was married in Maine and moved to Tennessee, the marriage would not be recognized by the state of Tennessee.

This meant you may not be the first of kin notified in an accident. You could be legally prevented from visiting a loved one in the hospital. The issues were endless.

In 2015, the Obergefell case came to the U.S. Supreme Court. That case came about because Jim Obergefell was prevented from putting his name on his late husband’s death certificate.

Shortly after his husband’s diagnosis of ALS, they traveled to Maryland and were legally married in that state. However, they lived in Ohio, where same-sex marriage was still illegal.

The case relied on the 14th Amendment, passed to give protections to African Americans after slavery. That amendment stated:

No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

 The U.S. Supreme Court agreed and ruled that an LGBTQ+ marriage in one state was legal across the country, just like a marriage between a man and a woman.

However, the federal government still didn’t fully recognize LGBTQ+ marriages.

How did the Respect for Marriage Act impact LGBTQ+ marriages?

In the 1990s, the Defense of Marriage Act was passed and signed into law by President Bill Clinton creating legislation that codified a marriage was between a man and a woman and that LGBTQ+ marriages were not eligible for federal benefits.

Over time and through a variety of legal actions, many of the provisions of DOMA were overturned by the courts and administrative actions.

For instance, in 2013, a court decision gave LGBTQ+ married couples full tax benefits, immigration benefits and military benefits. The next year, the Justice Department gave same-sex couples benefits such as prison visits and the denial of testifying against a spouse.

After the Obergefell decision, it appeared that gay marriage was the law of the land, but after Roe v. Wade was overturned in the Dobbs case, concerns started rising that Obergefell was in line to be overturned, especially after some justices and lawmakers said they thought it should be revisited.

Without the benefits in legislation, it would be easier to reverse progress on rights for LGBTQ+ couples.

The result was the passing of the Respect of Marriage Act in 2022 with bipartisan support. This act officially overturned the Defense of Marriage Act and codified equal rights for marriages of all types by the federal government.

Can we go back to before Obergefell?

 Very quickly, the answer is yes, but it won’t be easy.

First, the court would need to overturn Obergefell to return the issue of marriage to the states, as it did with the Dobbs decision on abortion. There is a key difference between the two cases though.

In the Dobbs case, the court ruled that abortion was not an inherent right as it was not common before the 20th Century. In Obergefell, marriage was determined to be a fundamental right and LGBTQ+ marriage was allowed because of the equal protection clause.

Of course, that decision was a 5-4 decision in a court with a court that had a majority liberal makeup. Today, the court is conservative, so overturning Obergefell is a possibility.

If so, that could allow states to reenact their ban on same-sex marriages, but they would still be legal in many states – and federal benefits would still apply to any LGBTQ+ marriage.

What is unknown, however, is if you were married in Florida from 2015 to today, and Obergefell is overturned, is your marriage still legal? It’s just unclear how far a court would go in overturning the law and we wouldn’t know until the Supreme Court ruled.

There is better news on federal benefits. It takes 61 votes to pass most legislation in the U.S. Senate because of the rules on filibusters. The Respect for Marriage passed with 61 votes, with several Republicans crossing over to vote for the bill.

In the next Congress, it would take several Democrats voting to strip LGBTQ+ couples of their rights – something that would be doubtful to happen.

However, the filibuster rules could also be changed by the Republicans in charge of the Senate, who objected to the change when Democrats controlled the Senate.

It is a possibility and that’s why you need to ensure your estate planning is current and legal.

What to do to ensure an LGBTQ+ marriage is protected

 While we can hope that LGBTQ+ marriage remains the law of the land, it’s best to not let your loved ones’ future be left to hope.

No, you need to take action soon to ensure you have legal protections, such:

  1. A current will that states
    1. how assets are distributed,
    2. how children are cared for after death,
    3. any other provisions that you believe are important, and
    4. instructions for a funeral and burial.
  2. A medical directive that includes who has the right to end life support and who has visiting privileges in the hospital.
  3. Trusts that can provide income for the living partner or children.
  4. Proper titles on houses, cars and other large items.

There are several other aspects of an estate plan that should be looked at to try to ensure protection in case the Respect for Marriage Act and/or Obergefell decision are overturned. While no action is completely immune from new legislation or court rulings, having your wishes in legal documents gives the courts an instruction manual for your final wishes.

While there is nothing imminent on same-sex marriage at this time, it is a possibility change could be coming. Besides, even if same-sex marriage remains the law, estate planning is an essential step for all couples.

After all, if estate planning is not complete, the courts will be forced to guess what couples and individuals want to have after their death, regardless of who you love and marry.

The attorneys at The Orlando Law Group can help LGBTQ+ couples with estate planning, legal protections and more in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

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Think about using your full lifetime gift exemption today

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For individuals and couples with a high net worth and a significant amount of assets, it is essential that you look at all ways to ensure your estate goes to your heirs and not to Uncle Sam.

After all, at the end of 2025, the 2017 Tax Cuts and Jobs Act, commonly known as the Trump Tax Law, will most likely expire. Along with that expiration is a significant exemption for estate taxes that could be cut in half.

Plus, depending on who is in control of the federal government after the election, the estate tax exemption could decrease even further.

Included in that is a significant reduction in the estate tax exemption, reducing the amount one can pass on to heirs by more than $7 million.

Plus, depending on who is in the White House and who controls Congress, the exemption could be much lower.

One way to help lower the tax burden, allowing your heirs to keep more of your estate is by utilizing the lifetime gift exemption in the next two years.

The attorneys at The Orlando Law Group can work with you to find ways to limit your estate’s tax liabilities, regardless of who is in office.

Why should we act now?

We’ve discussed this in other articles, but it will be very difficult to extend the estate tax exemption past 2025, which is set to sunset at that time.  That is because the exemption is not something easily overturned.

Right now, the lifetime gift exemption is $13.61 million for an individual and $27.12 million for a couple. On January 1, 2026, that number drops back to $7 million for an individual and $14 million for a couple.

Plus, Kamala Harris has said she would like to lower that even further if she wins the November election

The time to act on your estate plan and the transfer of any wealth accumulated must happen soon to ensure you are protected.

How does the lifetime gift exemption work?

The lifetime gift exemption is just like any other gift exemption, except it can only be done once.

Many people are familiar with the annual gift exemption where you can provide your children and their children with an annual gift of $18,000 per individual or $36,000 per couple.

With a lifetime gift exemption, those are no longer allowed. Instead, you are making a one-time gift of up to $27 million to your heirs from one couple.

Of course, you can just write a check, but we do not advise that even if an heir is responsible and an adult. Instead, we suggest looking at establishing a trust that includes specific distribution rules for your heirs.

For instance, a Spousal Lifetime Asset Trust, an irrevocable trust or any of the types of trusts we outline in this article.

Why should I give the full gift now?

While there may be concert concerns about relinquishing so much of your assets at one time. And, to be clear, there is no going back. It is a permanent gift, nonrevocable after it is done.

But look at this graphic from Merril Lynch that shows how much could be saved.

Plus, those assets can still build in value and interest, but the capital gains tax and any income taxes that could be paid in the future from the gift are less than the estate tax.

Of course, it’s also important to carefully decide which assets to put in the estate. Putting an asset that could significantly increase in value could create more tax burden for your heirs.

When do I need an attorney?

When you are giving this type of gift, it is important to ensure the legal documents and requirements that go with that gift are clear and concise – and legal.

The attorneys at The Orlando Law Group can work with you, your financial planner and your accountant to ensure you and your heirs will lose as little as legally possible to the IRS.

The attorneys at The Orlando Law Group can these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Have you considered including SLATs in your estate planning?

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By the end of 2025, the rules about estate planning most likely will be considerably different. That’s because the 2017 Tax Cuts and Jobs Act, commonly known as the Trump Tax Law, will most likely expire.

Included in that is a significant reduction in the estate tax exemption, reducing the amount one can pass on to heirs by nearly $7 million.

Plus, depending on who is in the White House and who controls Congress, the exemption could be much lower.

That said, there are steps you can take now to significantly lower the tax burden on your estate when you pass away. One item you should be looking at is the creation of the Spousal Lifetime Asset Trust or SLAT.

By creating these types of trusts, you can help shield significant assets from the Internal Revenue Service while still utilizing these assets.

The attorneys at The Orlando Law Group can work with you to find ways to limit your estate’s tax liabilities, regardless of who is in office.

Why should we act now?

We’ve discussed this in other articles, but it will be very difficult to extend the estate tax exemption past 2025.  That is because the exemption is not something easily overturned. After all, the law was written with sunset provisions in place.

To overturn the exemption, a new law must be passed by Congress, a virtually impossible task considering how close the majorities are in the Senate and the House of Representatives.

Many groups are working hard to show how the Tax and Job Cuts Act of 2017 helped spur the economy and to convince Congress to eliminate the sunset provisions that were part of that act.

Still, don’t bet millions on that being successful.

The time to act on your estate plan and the transfer of any wealth accumulated must happen soon to ensure you are protected.

What is a SLAT?

Think of trusts as creating a separate bank account for your assets, although it is one that you will not have direct control over. There are very specific types of trusts, each with contractual rules on distributions, taxes, beneficiaries and more.

A SLAT is a type of trust that is designated to have a spouse as the controlling interest of the account. All types of assets can be put into the trust, from cash to insurance policies to real estate.

Once it is set up, the beneficiary spouse can have regular payouts from the SLAT that can be used for nearly anything.

The assets in the SLAT also continue to earn interest, allowing for your assets to grow and not be taxed when you pass away, creating even more transfer of wealth.

Charles Schwalb gave a great example of how SLATs work in this article.

Say Sarah and Neil have joint and separate assets totaling $35 million, which are likely to further appreciate while they’re still alive.

Were they to transfer $13.61 million each into two SLATs benefiting each other, they would be able to exclude the full $27.22 million—plus any future appreciation and income—from their taxable estates while still benefiting from those assets.

They would then have available their remaining $7.78 million in shared assets, plus their SLAT distributions, to support their ongoing income needs.

The earlier you can establish SLATs for your assets the bigger the advantage!

Can we have two SLATs for our assets?

As referenced in the article, a husband and a wife can establish a SLAT for their spouse. However, this can be extremely complicated to avoid specific IRS rules.

One of the best things to do is stagger the establishment of a SLAT. Create a SLAT this month for one spouse and then create the other one six months later.

Then, you can make them different by putting different trustees in charge of the trusts. You can set up different beneficiaries when you die, for instance, one goes to your son and the other to your daughter.

The key here is that you cannot have two trusts that are similar to each other. The IRS will cancel them out, but our attorneys can help set up unique trusts for you and your spouse.

What happens if we divorce?

No one likes to think about the unthinkable when setting up an estate plan. We like to think we will be together forever.

The reality is that when creating a SLAT, you need to take steps to protect any assets in the event of a divorce. One of the toughest aspects of divorcing with a SLAT is the tax implications.

Without taking proper steps to deal with divorce, the spouse who set up the trust continues paying income tax on interest in the SLAT. That’s even if only your ex-spouse can access the funds.

Yes, you can put the procedures into the SLAT’s documents in the event of a divorce, but that is not always easy and may need separate attorneys. And, if each spouse has a unique SLAT of equal value, there may not be an issue.

However, when dealing with a SLAT, it may make sense to draft a postnuptial agreement that clearly defines what happens to all trusts – not just your SLATs – when you divorce.

For instance, you could set up a third-party trustee who can distribute all assets of the SLAT to be divided up as marital assets.

Of course, that wipes out all the tax advantages for your children.

When do I need an attorney?

SLATs and all trusts are extremely complicated legal documents. A wrong step along the way or a poorly worded contract that doesn’t fit your unique situation can cost you and your beneficiaries millions in taxes.

Estate planning is truly a team effort with your financial planner, your accountant and your attorney. Each of those three has very specific roles and responsibilities that come with estate planning.

At The Orlando Law Group, our team of attorneys and advisors can work with your team to handle all legal aspects of your estate plan. After all, an estate plan is a set of legal documents for the courts to understand your wishes for your estate after your death.

The attorneys at The Orlando Law Group can these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Take Advantage of the Estate Tax Exemption Today

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As we look to 2025 with a new president, one of the most pressing topics is what will happen to the Tax and Job Cuts Act of 2017 passed during President Donald Trump’s first administration. Much of that bill is expected to expire in 2026, including several aspects of estate planning.

The biggest change could cost your estate millions of dollars if you do not act now – a significant decrease in the estate tax exemption.

Before the Trump tax law was passed, families did not have to pay estate taxes on roughly the first $6.5 million in an estate. The new law increased that exemption to the 2025 level of $13.6 million.

Without any change, the exemption will go down to approximately $7 million in 2026. That simple change could cost your heirs millions of dollars.

The attorneys at The Orlando Law Group can work with you to find ways to limit your estate’s tax liabilities, regardless of who is in office.

How Does the Election Affect My Estate Tax?

The reality of the situation with the tax law is that it may not matter who is in the White House for this exemption. That is because the exemption is not something easily overturned. After all, the law was written with sunset provisions in place.

To overturn the exemption, a new law must be passed by Congress, a virtually impossible task considering how close the majorities are in the Senate and the House of Representatives.

What do each of the presidential candidates promise?

Trump has promised to make the exemption permanent.

Kamala Harris proposed following the current tax plan proposed in the American Housing and Economic Mobility Act of 2024, dropping the exemption to just $4 million.

However, that bill was introduced in Congress months ago and has yet to have one vote or committee hearing. Unless there is a major change in Congress, a similar fate would most likely happen to any large tax bills introduced with either Trump or Harris in office.

That’s why many groups are working hard to show how the Tax and Job Cuts Act of 2017 helped spur the economy and to convince Congress to eliminate the sunset provisions that were part of that act.

Still, don’t bet millions on that being successful.

The time to act on your estate plan and the transfer of any wealth accumulated must happen soon to ensure you are protected.

What Can I Do Today?

The biggest thing that needs to be done as soon as possible is to put together a full estate plan, including a will, any trusts that can be developed, charitable giving and more.

A high-income individual who will be affected by the estate tax exemption should have done this already. If not, stop reading and call The Orlando Law Group immediately.

If the will is done and the estate plan is complete, it is time to review to make sure you pay as little taxes as necessary under current and future rules.

One of the things you can do is establish legacy charity gifts in your estate plan. These are targeted gifts for your favorite non-profits who can all use your gifts to help others.

After all, do you want the Internal Revenue Service to take your money, or would you rather it go to help children, to help the homeless or help the environment? By having those gifts established in your estate plan, it will lessen the impact of taxes.

Another thing to do is develop and annual plan of gifting to your heirs. For instance, every year a couple can give $36,000 to each of their heirs. It’s not a lot of money compared to the change in estate tax exemption, but it will help lower the taxes on those gifts.

You could also set up a 529 account for your grandchildren’s college education. This fund is tax-free and can be used for a wide range of needs around higher education.

Finally, make sure you transfer assets into a trust. This creates a separate entity that is not taxed while you are alive and only taxed with funds or assets are removed from the trust.

When do I need an attorney?

Estate planning is truly a team effort with your financial planner, your accountant and your attorney. Each of those three has very specific roles and responsibilities that come with estate planning.

At The Orlando Law Group, our team of attorneys and advisors can work with your team to handle all legal aspects of your estate plan. After all, an estate plan is a set of legal documents for the courts to understand your wishes for your estate after your death.

The attorneys at The Orlando Law Group can these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Update Your Estate Plan After Major Life Events

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Estate Planning is the process of creating legally enforceable documents that determine how your assets will be distributed upon the event of your death. Your estate plan, just as it sounds, refers to your personal plan for your estate, including who inherits what, which assets and how those assets will be distributed to your beneficiaries or heirs.

There may be many reasons why a person should update their estate plan, but generally, you should look to update your estate plan after a major life event, such as getting married, getting divorced, or after having a baby. Keeping your estate plan up to date allows you to best ensure that your wishes for your estate are followed and that your legacy is protected. Read on to learn about some of the common reasons or major life events after which someone may need to update their estate plan.

  1. Marriage: Starting a life with your spouse brings with it many life-altering changes. But during this exciting time of wedding planning, honeymoon booking and even preparing for the eventual arrival of children, it’s vital that you don’t forget to keep your estate plan up to date. Doing so allows you to name your new spouse as an emergency contact or beneficiary for existing insurance benefits, and to ensure that he or she is taken care of in the event of your death.
  2. Divorce: Splitting up a marriage can be messy and costly. Updating your estate plan following the dissolution of a marriage is vital to ensure that your assets are split as per your wishes. Many people take their ex completely out of the equation, while some prefer to leave them something in their will. No matter what your decision may be, it is incredibly important to get your wishes on paper as soon as possible.
  3. Cash Infusion: If you receive a large salary increase at work or come into money through inheritance or chance, you’ll want to update your estate plan to accommodate a larger bank account.
  4. Having a Child or Having a Grandchild: Adding on to your family is a joyous occasion that calls for immediate alterations to your estate plan. Your new addition needs to become a beneficiary, and guardians must be named in your will. (This is also a great time to draft a will if you haven’t yet!) As you add on to your family over the years, you should continuously update your estate plan. It’s best to amend the documents so the new family members are named and specifically included in your estate plan.
  5. Your Life’s Circumstances or Relationships Change: A change in your life’s circumstances or your personal relationships could refer to the addition of a new child, grandchild, niece or nephew, or perhaps a new romantic relationship of close friend, which could lead you to want to alter your estate plan to specifically include new friends, romantic partners or family members in your estate plan. However, there may also be times when it is appropriate to remove someone who formerly was included in the estate plan, such as someone who has been irresponsible with money in the past or who is estranged from the family. You may also decide to include a charitable organization in your will.
  6. A Death in The Family: If you outlive some of the people named in your estate plan, you will need to update once again. If your Power of Attorney, Health Care Proxy, or Executor passes away you will need to name new ones. Also, should a beneficiary die, their inheritance should be reallocated immediately to other living heirs.
  7. Sickness: If you are diagnosed with a chronic or fatal illness you should begin planning before your condition worsens. As per your estate plan, you can decide who will make medical decisions on your behalf in the event you become physically unable. You can also use this opportunity to fill out a Do Not Resuscitate order if your state allows it.
  8. Changing Laws and Locations: Federal and state laws are constantly in flux and can impact your estate plan. Also, since different states have different laws, it is important to check with a legal professional once you move to a new area to see if any changes need to be made to your existing plan.

As you can see, there are many reasons a person would want to update their estate plan after a major life event. However, the importance of timeliness in updating your estate plan should not be underestimated. If you fail to keep your estate plan up to date for whatever reason, or if you suddenly become unable to update your estate plan (such as after falling ill or becoming incapacitated), your estate could end up in the hands of someone that you did not intend it to be for. The last thing you would want is for your estate and assets to go to someone you did not want it to go to and to fall out the hands of those you did want it to go to just because you did not speak to an estate planning attorney and update your estate plan.

If you need to make any changes to your estate plan after a major life event, you should do so as soon as possible so that you do not miss the chance to do so and to put your mind at ease knowing that your estate is in good hands. If you have not already created your estate plan or had a will prepared, you should consult with an estate planning attorney to get your documents drafted as soon as you can.

The attorneys at The Orlando Law Group represent individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Estate Planning for LGBTQ+ Couples

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Overview

It has been a little over seven (7) years since Obergefell v. Hodges made same-sex marriage legal in all 50 states. This historic Supreme Court decision opened the legal benefits of marriage to same-sex couples all across the country, including easing the process of estate planning. Today, married same-sex and LGBTQ+ couples’ estate planning is largely the same as estate planning for any other married couple. However, LGBTQ+ couples are less likely to get legally married and they may have children where only one or none of the partners is the child’s biological parent. This can complicate the estate planning process and is why estate planning is even more important for LGBTQ+ couples.

With the overturn of Roe v. Wade, there has been increased discussion about the future of other privacy rights, including same-sex marriage. In his sole concurring opinion, Justice Clarence Thomas indicated that the Supreme Court should reconsider previous rulings regarding privacy rights, including those that established the right to contraception, same-sex marriage, and protections for same-sex relationships. While no one wants to think of what would happen if they passed away, it is necessary to make sure your possessions get passed along the way you prefer, and not caught in the convoluted purgatory of probate. Read more about estate planning steps you should consider, particularly in light of recent political developments.

The Importance of Estate Planning

Careful and well-thought-out estate planning is essential for anyone who wants to protect their assets and loved ones regardless of sexual orientation; however, experts agree that it is likely more critical for same-sex couples and families due to marriage equality laws. While there is no need to draft estate planning differently from heterosexual spouses, same-sex couples need to make an effort to check the estate planning documents they already have to make sure they have language consistent with current laws, and, if couples do not already have one, to begin developing an estate plan. A typical estate plan may include:

  • A Last Will and Testament – the primary document regulating your wishes as regards inheritance and guardianship of persons (such as minor children) and property;
  • A Trust – protects assets for the benefit of yourself and/or specific persons;
  • A Living Will (also called a Designation of Health Care Surrogate) – specifies your intent in regard to decisions on your physical well-being and end-of-life arrangements;
  • A HIPAA Release and Authorization – allows person(s) designated by you to receive your confidential health information;
  • A Durable Power of Attorney – enables a trusted Agent to make financial and/or medical decisions for you in the event that you are incapacitated; and

If you die without a will or trust, state laws of intestate succession will determine who inherits from you, potentially leaving your partner of many years with nothing. This can be particularly important if you are estranged from your family or expect any family conflict over the assets you will leave. In Florida, Florida Statute Sections 732.101-109 explains that when someone passes away without a will, or trust, all assets go to their closest relatives. The first to inherit is the surviving spouse; however, there must be a valid, legal marriage to be a surviving spouse. This is particularly important for LGBTQ+ couples, as the recent U.S. Census Bureau Data reports that about 42% of couples in the nearly 1 million same-sex households in the United States were unmarried partners. Without sufficient estate planning in place, an unmarried partner is likely to be overlooked in asset distribution. Taking control of your estate and the division of your assets through estate planning means that you can protect yourself and your assets and provide for your loved ones by your own intentions, and not that of the state. Estate planning is important for everyone, regardless of relationship or family status. For members of the LGBTQ+ community, it is even more important to treat these matters formally, without relying on default rules of state law.

Even if you already have an estate plan, it is imperative that you revisit that plan in order to ensure that it remains relevant under your current family and financial circumstances. If your estate planning documents were created before same-sex marriage was legalized across the country and you have since married, it is important for all of your documents to have consistent language that reflects that. The Human Rights Campaign offers a comprehensive step-by-step guide on estate planning for LGBTQ+ couples and their families for free that explains this importance.

Extra Assistance with a Special Deal

We recognize the sense of urgency that many couples are facing in light of the Supreme Court decision and hope to alleviate some of this burden by offering a special deal to LGBTQ+ couples in their estate planning matters. We are currently offering FREE health care estate planning documents including Combination Living Wills and HIPAA Release and Authorizations as well as Durable Power of Attorneys to LGBT+ couples in order to help you and your family plan for the future. Call 407-512-4394 to discuss scheduling a consultation with an estate planning attorney to take advantage of this opportunity for the months of August and September.

Overall

This article is not a substitute for consulting with an estate planning lawyer at our firm who is well-versed in the issues facing LGBTQ+ individuals, couples, and families. Thorough and proper estate planning is vital to ensuring that your wishes are carried out during your lifetime, and that your assets are passed along to your loved ones in the manner you desire after your death, which can potentially be more complex for the LGBTQ+ community. Our experienced estate planning attorneys understand the challenges LGBTQ+ individuals of all marital statuses face. If you have questions about anything discussed here or involving estate planning, feel free to give us a call at 407-512-4394. We bring experience and sensitivity when assisting members of the LGBTQ+ community in planning for asset protection, incapacity, and end-of-life issues.

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Pet Trusts

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Did you know that the American Veterinary Medical Association found that 85 percent of dog-owners and 76 percent of cat-owners think of their pets as family? We love our pets like family, so we should treat them as such. As a part of our families, pets deserve continuing care in the event of our incapacity or passing. One of the best ways to do this is to establish a pet trust. Trusts are not only for dogs and cats. A trust may be established under Florida law for all kinds of animal companions, including horses, turtles, birds, and more! Trusts can be extremely beneficial for long-living animals such as certain reptiles and birds that can live over 100 years and require specialized care. We at the Orlando Law Group care for our pets immensely, as you may be able to tell from our Facebook and Instagram pages showcasing the “Pets of OLG.”. As such, we want to let you know that a pet trust may be the exact thing you need in order to ensure your pets are well cared for after you have passed. Using a pet trust, you can leave money to be used for the care of your pet(s), put someone in charge of managing and spending that money, and include a set of written instructions created by you to ensure that your furry friend is well taken care of in the event of your incapacitation or death. Read on to learn more about setting up a Pet Trust in Florida!

Setting Up a Pet Trust

Once, pet trusts were considered a far-fetched idea. Now, Florida (along with the other 49 states) has established statutory provisions (F.S. §736.008) providing for the ability to create a pet trust for our beloved animals. A pet trust outlines who will care for your pets, for how long, and the exact maintenance terms desired. Florida is unique compared to some of the other states, in that it allows the trust to continue until the death of the last remaining pet, instead of limiting the length of the trust to 21 years. Importantly, a pet trust can only be set up for animals alive during your lifetime.

Should you have more than one animal that requires care, that is permitted as well. You have the ability to appoint a caregiver for your animal(s), as well as a trustee who will enforce the terms of the trust and ensure that the funds you have set aside for your pets are used the way you intended. The trustee can verify that your pets are being cared for by their appointed caregiver in the way you have outlined, by way of receipts and/or medical bills, and if those funds are not being used in accordance with the terms of your trust, your trustee may have the ability to remove the person appointed to care for your animals and replace them with an alternate person. Within the pet trust, you can also specify your choices for an alternate person or persons to care for your pets in the event that your first choice of caregiver is removed by the trustee, incapacitated or passes away. Additionally, unless the trust documents specifically state otherwise, if the amount in the trust exceeds what is needed to pay for the animal’s care, it will be administered either as part of the grantor’s estate or to the grantor himself/herself if living. A pet trust works the same as a revocable living trust. You, the grantor, create a legal trust entity and fund the trust by placing the necessary money and assets into a separate account in the trust’s name.

You are the one who knows your pet best, so it is important to leave a detailed plan for the care of the pet. Some important information you can have in your pet trust could include necessary medication for your pet to be administered, should they have any medical issues; their likes, their dislikes, which veterinarian you prefer they go to, their activity level and, any past, present, or future concerns you may have regarding your pet(s). You may also include whether you would like your pet cremated or buried after they have passed. All of these are important to ensuring the well-being of the pet, and outlining such will allow you to make sure your animal(s) will be properly cared for.

A pet trust is the best way to ensure that your pets are never sent to a shelter, sold or placed in the wrong hands in the event of your passing. Because the trust includes necessary funds to pay for your pets’ care, having a pet trust takes the burden off of your family or loved ones to financially provide for them after you are incapacitated or have passed away. Additionally, the detailed wishes in the trust guarantee that your pet is cared for just the way that you want even after you are no longer around.

There is much more to know about pet trusts before you are able to decide whether they are the correct estate planning tool for you. If creating a pet trust is something you may be interested in, be sure to consult with a knowledgeable estate and trust attorney.

Protecting Your Pet is Just a Phone Call Away.

Do you love your pets like any other member of your family? Do you ever cringe at the thought of your pet passing away? Do you ever wonder what would happen to them if you passed first? Don’t leave planning for your future and that of your furry friends to chance. All it takes is one phone call to the Orlando Law Group to ensure that your wishes are followed, and your loved ones (both animal and human) are cared for when you are gone. Call us at 407.512.4394 to receive only assistance regarding your estate planning but peace of mind as well. Our experienced attorneys would be happy to help you with any estate planning matters and questions you may have.

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A Will Can Protect

Having A Will Is The Best Decision You Can Make: Here’s Why

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Justifying Your Legacy With A Will

Here’s the truth – you have a legacy that should be protected. Unless you own absolutely nothing and have no possessions, then you have a legacy to care about. The second thought, and one that we often avoid is, “What would happen to everything you own upon your death?” We can attest to the fact that many who have gotten a will with us have all mentioned the same thing: “Why didn’t we think of this sooner?” We believe that’s because people do not fully comprehend the complexities that can occur when you die without a will.

We are the Orlando Law Group, an 11-year-old, full-service law firm located in Central Florida helping our community with all of their legal matters. In this blog, we will discuss the merits of having a complete estate plan, and how that can protect your legacy and its transference to your loved ones. No one wants to think of what would happen if they passed away, but it is necessary to make sure your possessions get passed along the way you prefer, and not caught in the convoluted purgatory of probate.

What Happens When You Die Without A Will?

Dying without a will is called dying “intestate.” If you die intestate the Florida Intestacy Statutes will determine the distribution of your assets at death. This was brought into the mainstream news when Black Panther actor Chadwick Boseman tragically passed away in August of 2020. He, after a four-year battle with colon cancer, died without a will, with an estate at an estimated value of $938,500, according to papers filed in Los Angeles County probate court. The truth is it isn’t uncommon to die intestate. In some situations, you may be content with the plan that the lawmakers determined for you, and in other situations, you may not be so happy with it. Along with not being able to decide who gets your property after you die, there are many other pitfalls that come with dying without a will that you may not be able to foresee.

Time Consuming Constraints

While dying with a will does not mean that the distribution of your property is a quick and painless process, dying without a will is surely a long, drawn-out process. If you die without a will in Florida and probate is required, a Personal representative (commonly known as an “Executor”) must be appointed. If you were to die with a will, you would have designated a personal representative in the will. Without a will, you do not get to choose your Personal Representative. This could potentially open the door for disputes among the beneficiaries as to who should be appointed as Personal Representative. They will quiet literally be forced to guess what your wishes would have been.

Expenses Rising

When you create your will, your attorney will discuss ways to avoid probate. Although probate is not especially expensive or complicated, the fights over who will administer your estate and be in charge of distributing your assets most certainly are, not to mention the fact that they can cause permanent rifts in the family. The cost to not having a plan that comes from you can be grave, and that is where so much of the value in having an estate plan can help. It takes the pressure off of your loved ones to wonder what you would like done with everything you own. Now, instead of guessing and speculating, they can carry out your wishes to specification. For many families, it is a way to come together to make sure your will is carried out, rather than argue and battle over what they thought you would have wanted. Probate is a complicated matter, but if you would like to read more about probate, we discuss exactly that in our blog right here.

Alleviating a Stressful Situation

We at The Orlando Law Group like to look at an estate plan as a gift from you to your family. It sounds odd, and the truth is that they will not realize it’s a gift until they’ve seen what can happen without one. When you observe families that have gone to literal legal war over estates, you realize that it all could have been avoided with the power and authority coming from the deceased. They could have set the record straight on how they wanted their possessions handled, but because they did not, their family is left to try and figure everything out. Emotions become raw, and greed can get the best of even the best of us when we are emotionally vulnerable.

It does not have to be this way. For the most part, having a comprehensive estate plan and someone designated to carry it out creates peace during a time of grieving. You want your loved ones focused on remembering what a beautiful life you lived, not worried about what you would have wanted your estate plan to be. With all that we have gone through in the last year, we know first-hand how precious life is. We fully comprehend how fast a situation can change, whether that be through an unexpected diagnosis or through a freak accident. We say this to help everyone understand what we understand: that a will is not for the dying, but rather for the living.

If you have questions about anything discussed here or involving estate planning, probate, or any of your legal needs, feel free to give us a call at 407-512-4394. You will reach our Waterford Lakes office, which can connect you to any of our other numerous locations. Our attorneys have a wealth of experience when it comes to what is involved in a comprehensive estate plan, and they would be happy to answer any questions that you have. Thanks for reading, and if we could leave you with one thought it is this: “Your legacy matters, so don’t wait to take measures to protect it.”

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What you need for probate

What You Need For Probate – The Process of Proving a Will

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When a loved one passes away, the grief one feels drowns out the ability to execute on the necessary actions to preserve their wishes. The legal tools by which we do so are often overlooked and misunderstood, and that is mainly due to the fact that there isn’t enough education on how to protect and pass on your assets effectively.

Probate is the process of transferring your assets into the name of the beneficiaries you wish to provide said assets to, upon your death. It also provides creditors with an opportunity to make a claim against your estate for any unpaid debts.

Assets such as a home, a vehicle, or a bank account will have to be provided in an itemized list to the Court. More often than not, someone will pass away without an Enhanced Life Estate Deed, thus eliminating the ability to pass on their home outright to their desired beneficiaries. Probate is necessary to transfer specific interests of an estate into the name of the selected beneficiaries properly.

It is also important to note that the size of the estate will determine the type of administration that will occur.

Some of the items that will be required to complete the probate process are:

1. The Original Certified Death Certificate

2. A statement reflecting that the Funeral home was paid in full

3. The Original Last Will and Testament

4. A List of creditors/ debtor’s name, the account number, and the amount due

5. List of assets including a description and their estimated value; bank account info including bank name, account number, balance; and the address of the homestead

6. The Beneficiary names, addresses, and relationship to decedent

7. Who will be Personal Representative and their address

8. If any ancillary probates have been opened in another county or state

We will then draft the initial probate documents, which include but are not limited to the following:

The Petition for administration, a notice of designation of email addresses for service of document, Oath of Personal Representative/Designation of Registered Agent and Acceptance, a proposed order admitting the will to probate which appoints the identified individual as personal representative, letters of administration, waivers of service of the notice of administration, consent to probate, and a notice to creditors, which provides them with a certain period of time in which to make a claim for any debt owed by the descendant.

If the home was/is homesteaded, we will need to draft:

  1. Petition to Determine Homestead Status
  2. Proposed Order
  3. Creditors need to be served via certified mail

If the estate requires a formal administration, we will then draft:

  1. Publication of notice to the creditors;
  2. Proof of publication;
  3. Notice to the department of revenue/department of social security with death certificate and notice to creditors;
  4. Proof of service of notice to creditors;
  5. Inventory;
  6. Affidavit of no estate tax due;
  7. Statement regarding creditors;
  8. Waiver of accounting;
  9. Petition for discharge with estate assets and plan of distribution;
  10. Order for discharge

The Importance of a Last Will and Testament

A last will and testament is essential when outlining how you would like your assets to be divided upon your passing, especially any digital assets such as photos, crypto currency, media platforms and revenue derived from such.

Take the untimely and unfortunate death of Chadwick Boseman as an example where a last will and testament was not created:

  • Chadwick Boseman, known for his roles in the “The Black Panther,” “Get on Up,” and “Marshall,” passed at the young age of 43 due to colon cancer. He died intestate, which means that he passed without leaving a Last Will and Testament behind outlining how his estate would be distributed or who would be nominated as the administrator of such.
  • His wife, Taylor Simone Ledward petitioned the court to be appointed as administrator of his estate and the distribution of assets would be subject to the intestacy laws of California, which provided for his spouse and his parents to be apportioned their interests in accordance with such.
  • In this instance, had his probate matter taken place in the state of Florida, the intestacy statute would have provided the entirety of Chadwick’s million dollar estate to his spouse, since he passed without any descendants (children, grandchildren, great grandchildren, etc.).
  • It is important to note that legal fees are removed from the totality of the estate, as well as costs and court fees that are incurred in furtherance of the probate matter itself.

Our Ultimate Point?

Do yourself and your loved ones the favor of planning ahead of time. The complication of, not only wondering what your wishes were, but also relying on the courts to settle the matter in probate is so much stress to put your loved ones through. Having a comprehensive estate plan does them a favor by knowing beyond a shadow of a doubt where you want your assets to go.

If a family member does pass away, with or without a will, then reach out to us. We will do our best to help you through that process so that their wishes are carried out.

So much of our objective here at The Orlando Law Group is about preventing complication before it happens. With an estate plan, you also achieve significant peace when concerned about the future, which is always, to some degree, unknown. Your legacy matters, and you deserve to have full control over it. If you have not completed a full estate plan, make sure to contact us and we would be glad to help.

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Estate Planning

How Estate Planning Protects Your Legacy

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You’re proud of the estate you’ve built up. You’re proud of the home you call your own. The treasured belongings you’ve accumulated. The cash assets that you’ve worked so hard for. The investments that you tend to daily, and the business interests that have come to define your professional life. Estate Planning matters so much to you and your legacy. Your possessions should be dealt with appropriately after you’ve passed on. But how can you do this, when you’re no longer here to distribute your assets among your nearest and dearest?

We can help you with all aspects of Estate Planning.

Estate Planning is the process of creating legally enforceable documents that determine how your assets will be distributed upon the event of your death. This includes who inherits, which assets and how they are distributed. It also determines who controls the distribution of assets once you’re gone and encompasses tax considerations that must be incorporated into these documents, to ensure that your loved ones get the best possible deal, and as little of your estate as possible is subsumed by taxes.

I’ve already made a Will, isn’t that enough?

Making a Will is extremely important to ensure that you do not die intestate — meaning that the state controls what happens to your assets after you die. Nonetheless, there’s more to proper Estate Planning than making a Will. In fact, it’s just the tip of the iceberg.

If you’ve lived in the state of Florida your whole life, you’re likely aware that many people from out of state choose to move here in their later years. And it’s not just for the hot weather and the ceviche. Unlike other states, when Floridians die, their estate is very rarely subsumed by the estate. There are also no estate or inheritance taxes in the state of Florida.

Nonetheless, while living in Florida is advantageous in this regard, that doesn’t mean that your estate deserves any less than comprehensive and responsible planning.

That’s where we come in.  

As well as helping you to make a Will and nominate an executor for your estate, we can offer a range of other Estate Planning services.

These can help you to avoid disproportionate taxation, and ensure that your assets are dealt with as fairly and equitably as possible in line with your wishes. These services include…

Assigning Power of Attorney

While a Will can help you to distribute your assets after you’ve passed on, Estate Planning also means putting an infrastructure in place to protect your estate when you’re no longer able to do so yourself. Such as if you fall sick, or are diagnosed with a condition like dementia, which will affect your ability to make decisions.

When this happens, you will need to assign Power of Attorney to someone you trust. There are different kinds of Power of Attorney for different circumstances. For instance, if you know that you will be in the hospital for a limited period of time, you may wish to assign a temporary or Ordinary Power of Attorney. However, if you know that you will be unable to make decisions for the remainder of your life in the future (such as a dementia diagnosis), you will need to assign a Lasting Power of Attorney.

We can give you the support and advice you need in choosing someone to look after your estate when you will be unable to do so yourself.

If you fall ill, you may be unable to make decisions in your own best interests. However, due to the nature of patient confidentiality, your doctor may not be able to communicate directly with the person you have chosen to look after your best interests.

An advance directive is a legal document that specifies the kind of medical and personal care you would want if you should become unable to make your own decisions or communicate them to medical professionals.

Anyone over the age of 18 can be chosen to execute an advance directive, and this document is binding in the state of Florida.

Your advance directive allows you to specify:

  • Who can make and communicate decisions on your behalf.
  • Any circumstances under which you would not like your life to be prolonged.
  • Any other wishes pertaining to your medical wellbeing that you are unable to communicate or decide yourself.

It also ensures that doctors can communicate directly with the person you have chosen.

Finding the right trust for your needs

There are many different kinds of trusts, and each serves a slightly different legal purpose. Some are designed to keep assets out of the hands of creditors, while others are intended to avoid probate court and incur tax advantages.

However, legal guidance is often needed to ensure that the right trust is selected for the client’s needs and to ensure that it achieves its intended purpose in terms of Estate Planning. We can advise on choosing the right trust to suit your specific needs, goals, and circumstances.

Validating Holographic Wills in your estate plan

If you have recently moved to Florida from out of state, you may already have a Will in place. However, if this is a Holographic Will, it may not be valid in the state of Florida.

A Holographic Will is completely handwritten and signed by the testator, but unless it has been signed by the testator in the presence of two witnesses (both of whom must be in the presence of the testator and each other when signing), it is not legal in Florida. Even if it is valid elsewhere. We can make the arrangements to ensure that a Holographic Will is legally valid.

Why you can trust the Orlando Law Group

We understand that the matter of Estate Planning is a delicate and somber subject. Nonetheless, you can trust in our years of experience, our diverse legal expertise, and our steadfast dedication to our clients and our community.

For over a decade, we’ve helped Floridians of all kinds including individuals, businesses, and associations manage a wide range of legal affairs.

Want to know more about how our team can service your legal needs? Please don’t hesitate to get in touch with us today. 

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estate-planning

Estate Planning: The Will to Plan Now Makes for an Optimistic Tomorrow

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During this time, we’ve been focusing on ways that we can help you feel safe, confident, and connected despite the difficulties so many are experiencing. We know that, for many individuals, the only way to combat uncertainty is by taking care of the things you can control. That’s why we believe that a Will is actual mental medicine for your tomorrow.

It’s the best way to know that your assets are protected and that your legacy will continue the way you want it to. The good news is that, even if you do not feel comfortable coming into our office, we can handle the process completely online using an online notary.

We have had a massive influx of these clients in the past week, and each one has helped us understand that right now, planning is giving them a sense of calm about their present and their future. This overall sense of settled is something that is hard to come by right now, and we are so grateful to help families and individuals get these forms in order.

You can call through video chat, which has now become the standard means of communication around the world, and we will take you through each step and follow our thorough approach to getting everything you need communicated and taken care of with the help of RON (Remote Online Notarization).

Below, you will find three benefits of getting these forms completed with our assistance. Right now, it’s about the control we can have over our future. We don’t know what tomorrow may bring, but with a Will and a plan, we know that we have some control over what the future holds in store.

Three Benefits to Getting a Will Completed Today:  

  1. Peace of Mind – There are a few things in our world that are priceless. One of them is peace of mind. For many of us, stress holds space in our minds unless we plan a way to add some control to our future.
  2. Healthcare Assistance – Knowing that you have the specific people designated to make Healthcare decisions and having them aware adds a level of comfort to any situation.
  3. Avoiding Conflict Between Family Members – By having everything in order, you avoid any potential conflict that might arise. You want your family to be able to focus on grieving, not making difficult decisions.

Another aspect of estate planning that helps you feel confident is the employment of Healthcare Directives. The Healthcare Surrogate Form gives your agent the authority to make healthcare decisions for you. If a doctor finds you mentally incapacitated, these forms will be vital to making decisions about your health.

We cannot stress the fact that these forms protect you and your family from unwanted stress, conflict, and complications. Below, you will find three concrete reasons why Healthcare Directives work in your favor. 

Estate Planning: Three Ways Healthcare Directives Help You: 

  1. Worry Less – When you’re sick, you don’t have to worry about making any financial decisions. At any point, if you needed someone to help you with making those decisions, they can do that. 
  2. Less Limits – People aren’t being allowed into hospitals at this time unless they are sick. This can complicate measures, and by having structures and documents already in place, you don’t have to scramble last minute, which can add to your worry.  
  3. Better Systems – Stress can create sickness. Getting these documents in place can diminish your stress at a time where stress feels like a constant state of being. There are aspects of the future that we can’t control, but this is something you can, and the comfort of control truly helps your immune system stay strong.

A Will was built to allow you to have the most control over your legacy. It is just as much about you preserving your goals for your assets as it is about allowing there to be no conflict between loved ones in the event of your passing. It brings our clients great comfort to have these documents in place, and we feel it is our honor to give them a tomorrow they can enjoy more and worry less about.

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Reverse Mortgage

The Reverse Mortgage: An Overview

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A reverse mortgage is a loan available to homeowners aged 62 years or older that allows a homeowner to borrow against the equity they have in their house in the form of a lump sum, fixed monthly payment, or line of credit.

Unlike a typical mortgage, with a reverse mortgage, the bank pays the owner of the house monthly mortgage payments, and when the owner of the house passes away or chooses to sell the home, the entire reverse mortgage balance becomes due and payable.

As long as the borrower is 62 years of age or older and lives in the home, he or she is not required to make any monthly payments towards the loan balance. The concept of the reverse mortgage originated as a way to help retirees with limited income use and benefit from the equity which they have built up for their house without having to sell the property.

With these types of mortgages, the owner of the property is ultimately responsible for the property taxes, homeowners’ insurance premium, utilities, fuel, maintenance, and other common household expenses. If only one spouse signed the loan paperwork, in certain situations, the other spouse may continue to live in the home even after their spouse passes away if he or she continues paying the above-noted bills and maintains the property. However, since the other spouse was not a part of the loan, all payments under the reverse mortgage will cease.

Most reverse mortgages have a “non-recourse” clause, which means that the value of the reverse mortgage cannot exceed the value of the home when the loan becomes due and payable. This can be beneficial upon the death of the homeowner because there will not be any bills related to the reverse mortgage outside of the equity in the house.

No other assets in the estate of the deceased homeowner are affected. There are three different types of reverse mortgages. As with any type of transaction, it is important to shop around for the best option for your home and fully understand the complexities of the transaction before locking yourself into a long-term loan.

Single-Purpose Reverse Mortgage

With this type of mortgage, homeowners can use single-purpose reverse mortgage proceeds only to pay for specific items that are approved by the lender. This single purpose may be for necessary repairs and maintenance, or payment of property taxes. The lender on this type of file is a state, local, or non-profit agencies. This type of mortgage considered the least expensive type of reverse mortgage. This option can be beneficial to many homeowners because it offers fewer expenses and fees than other types of reverse mortgages.

Home Equity Conversion Mortgage

This type of mortgage is likely to be more expensive and is the most widely used version of the reverse mortgage. This is because there are no income requirements, and the proceeds from the loan can be used for any purpose. This loan does not carry the same single-purpose limit detailed above.

The Home Equity Conversion Mortgage, or HECM, is insured by the Federal Housing Administration, or FHA, which means it has loan limits and some additional guidelines in place to protect borrowers. The HECM loan limit, or maximum claim amount, for 2022 is $970,800. That means the highest home value that can be used to calculate your reverse mortgage proceeds is $970,800.00.

Counseling is typically required before applying for this loan due to the higher expenses, interest rates, and payback requirements of this loan. Because this is a federally insured mortgage, there are usually high up-front or monthly ongoing insurance payments. These payments are usually taken out of the loan itself, and reduces the amount you are able to borrow.

Proprietary Reverse Mortgages

A proprietary reverse mortgage is not available to the average homeowner. As of 2022, in order to qualify for this type of reverse mortgage, your home must have a value of at least $970,800.00. This is not a federally insured mortgage and often has less stringent insurance requirements.

If you are considering this type of loan, you should also apply for the Home Equity Conversion Mortgage. This way, you can compare fees for both types of reverse mortgages to find out which loan fits better for your situation.

Wrapping It Up

Reverse mortgages do possess a poor reputation in the eyes of many due to several scams which look to target unsuspecting seniors and dishonest marketing to try to get homeowners to take out reverse mortgages. For instance, in late 2021, the Consumer Financial Protection Bureau filed a complaint and levied a $1.1 million fine against American Advisors Group for deceptive marketing regarding reverse mortgages.

Using a reverse mortgage can eat up the equity in your home, meaning there is less value to your estate that is left for your heirs. If your goal is to leave the house for your heirs to live in, a reverse mortgage may not be the right type of loan for you. On the other hand, using a reverse mortgage may allow older homeowners to better manage their expenses during retirement. You also would not have to pay taxes on the income you receive from a reverse mortgage, as it is not taxable because the IRS considers that income as “loan proceeds.”

Reverse mortgages have both pros and cons, and it is important that you understand the complexities of a reverse mortgage to know whether such a loan is right for you and your family. If you would like to discuss how a reverse mortgage may benefit your situation, please contact an attorney at The Orlando Law Group, P.L. via phone at 407-512-4394.

The attorneys at The Orlando Law Group represent individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with a real estate or estate planning issue, are wondering if a reverse mortgage is right for you, or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, or fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Orlando Probate Law

What is Probate Law?

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How Probate Law works

People hear the words Probate Law and automatically get fearful of what they think it means.

Probate law is a court-supervised process where often the courts will appoint an administrator. They are responsible for administering the estate. This includes identifying and gathering the assets of a deceased person (decedent), paying the decedent’s debts, and distributing the decedent’s assets to his or her beneficiaries.

An example of distributing an asset might be where a decedent has a real estate asset that is granted to a family member. That family member will take legal possession of the real estate asset.

What is the purpose of estate planning?

Estate planning organizes for the distribution of a person’s estate once they pass away. Put simply, all of the assets owned at the time of death will be distributed based on the will, trust or estate plan. Assets in a person’s estate might include real estate such as houses and investment properties. Assets might also include personal property like stocks, bonds, bank accounts, cars, jewelry, etc.

Estate planning is a complex endeavor and is most appropriately handled by a professional, like an estate planning lawyer who will work collaboratively with financial advisors, insurance specialists, accountants, and other professionals in the planning of the distribution of assets.

Why is estate planning important?

Estate planning benefits people with estates of all sizes in that it allows the individual to decide exactly how their assets will be distributed upon their death. Regarding personal property, the individual can decide who should get specific assets, like a house or bank account. This makes everything very clear and prevents unnecessary arguments between the estate’s beneficiaries.

Further, estate planning can benefit the children of the decedent. With proper planning, the children of the deceased can be taken care of to ensure they maintain their quality of life.

More about the probate process

Typical questions that our probate lawyers hear include: Does probate mean I have to wait years for the distribution of assets? Does this mean I will be responsible for debts of my loved one?  Will the courts make me do something I don’t want to do? Will this cost me even more money?  I lost my loved one why do I have to go through this?

If a will does exist it may make probate run smoother. However, if a person dies in Florida without a valid will, all assets will have to be decided by the court and state laws once heirs are established.

What are claims against the estate?

A “claim against the estate” references a claim for money, assets, or other property that an individual has against the estate of a decedent. For instance, if the deceased person owes money to a person or entity, it is the responsibility of the executors or administrators of the estate to pa that debt.

Claims against an estate must be filed with United States Court that is handling the local probate or with the estate administrator.

What is the role of a probate attorney?

The attorney will file motions, guide and advise the client (Personal Representative) how to proceed. The attorney is the communicator to the court on behalf of everyone involved.

A probate attorney will need to assist with the following as well:

1.    Collecting and managing life insurance proceeds.

2.    Getting the decedent’s property appraised.

3.    Finding and securing all of the decedent’s assets.

4.    Advising on how to pay the decedent’s bills and settle debts.

5.    Obtaining an Estate Tax id number and estate bank account.

6.    Determining whether any estate taxes are owed.

If you die without having written and signed a will, you are said to have died “intestate.”

What happens if there is no will?

When there is no will your estate is distributed according to the intestacy laws of the state where the property resides, regardless of your wishes. The law does not always follow the path you would expect especially in situations where there are blended families.

Is it possible to avoid probate?

In some situations involving probate law, a probate is not necessary when there are IRA’s, 401 K’s, Life Insurance and other investments with beneficiaries. Some people also use Lady Bird deeds, trusts, accountants that are payable on death and other vehicles to avoid probate entirely.

In short, there are many different scenarios that go into an estate plan and probate, and each circumstance has exemptions especially in situations with blended families or extended families.  It is wise to get your estate plan done by an attorney rather than getting forms on line so that you can look at all the scenarios and plan appropriately. Then at the time of probate, an attorney for the estate is required by the Court.

We highly recommend talking with a probate law and estate planning attorney to make sure the wishes you have for your estate should you pass away are fulfilled.

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What NOT to Include in Your Last Will and Testament

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Estate Planning is the process of creating legally enforceable documents that determine how your assets will be distributed upon the event of your death. This includes who inherits, which assets and how they are distributed. It also determines who controls the distribution of assets once you’re gone and encompasses tax considerations that must be incorporated into these documents, to ensure that your loved ones get the best possible deal, and as little of your estate as possible is subsumed by taxes.

A will is the primary estate planning document which regulates your wishes in regard to your inheritance and guardianship. It is only in a will that you can name legal guardians for children, as well as someone to manage any properties left to or earned by minors. A will also allows you to name an executor who will be in charge of wrapping up your estate after your death. That person communicates with the court, pays your bills, and eventually distributes any property that has to first pass through probate. A will also provides you with the ability to leave instructions regarding how you want your debts and taxes to be paid, as well as forgive any debts owed to you.

It’s important to understand that even though there are things that you should leave out of your will, drafting your last will and testament is one of the most important steps one can take to establish a full estate plan and to protect your legacy. The will identifies how you want your property and assets divided and who you want to get them when you are gone. While a will can include a variety of terms, there are some things that should not be included in your will.

  1. Funeral and or Burial Instructions

A will is often not located until after the funeral or burial. If you include these types of instructions in your will, most likely these wishes will not be discovered until after your funeral. It is usually better to convey your wishes ahead of time by speaking with the loved one who will most likely be responsible for handling this task or by purchasing a prepaid funeral/burial plan.

  1. Leaving Gifts to a Beneficiary with Special Needs

A parent may think that leaving a large gift to a child or other loved one with special needs will ensure that the loved one will be able to live their lives to the fullest or that they will have the ability to receive all the care they need. The last will and testament is not the place to bequest an outright gift to someone with special needs. A person with special needs receiving public benefits often times can only have a limited income and limited assets. Anything over the designated amount can disqualify someone with special needs from continuing to receive benefits. There are certain types of trusts, such as a special needs trust, that specifically address the management of the specific needs of a person with special needs. The trust can be a standalone special needs trust or even a trust created within the last will and testament.

  1. Leaving Gifts or Money for an Illegal Purpose

This does not happen very often, but it could be that someone tries to make a gift that says “to Joe, so long as he uses my property to grow marijuana.” Inserting an illegal purpose could invalidate the entire will.

  1. Assets with Named Beneficiaries

Life insurance, retirement plans, and financial accounts usually require a designated beneficiary be identified. Upon your death, those assets will be transferred to the named beneficiary, so they cannot be distributed by your will.

  1. Jointly Owned Property

Tenants by the Entirety and Joint Tenants with Right of Survivorship mean that when you or the other joint tenant dies, the survivor automatically owns the property in full. If a gift of joint tenancy or tenants by the entirety is made in a will, it will fail. It can’t be done.

  1. Property Owned by a Trust

The last will and testament cannot make a gift of any assets that are owned by the trust. The property owned by the living trust automatically goes to the beneficiaries and is managed by the trustee. If you want to leave the asset to someone else or change the terms, it must be done by an amendment to the trust, not the will.

  1. Conditions Placed on Gifts in your Last Will and Testament

Some people want to put conditions on gifts, and that can be okay, but one must be careful. Putting conditions such as “to Mary, so long as she marries a (insert religion) man” or “to Mary, so long as she divorces her bum husband” are not allowable and the will may be held invalid. Conditions such as “to Mary, so long as she finishes college” are okay.

If you are going to take the time to create a last will and testament, make sure that your time has not been wasted. Speak to an estate planning attorney who will ensure that the will is drafted properly and will be upheld in court during probate proceedings.

The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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OLG.ChristinaMiner

As Aretha Franklin’s family might soon be finding out, failure to file legal documents prior to one’s death can cause turmoil.

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OLG LEGAL COMMENTARY:

Attorney Christina Miner

At a recent speaking engagement, I shared my own personal family story about the dangers of not being prepared for one’s own mortality – and how that lack of preparation effects one’s family.

My grandparents, you see, were in a horrific car accident in 1994 in South Florida. My grandmother was killed on-scene. My grandfather was declared brain-dead.

They had four kids, my mother being the oldest one. When they all went to Miami, they learned that my grandfather did not have a living will, or any documentation that said what he would want if ever in such a life-threatening position. So, as such, it was left to the four children to decide.

After discussions, they agreed that my mother would make the final decision as to what to do with my grandfather. And after speaking with all doctors, and seeing that there was no possibility whatsoever for him to survive, my mother made the difficult decision to take him off life support.

And then, after he died, one of her siblings said that — had it had been left up to them — they never would have done that. That sibling blamed my mother for killing my grandfather.

More than 20 years later, there is still a rift in our family that was caused by that decision. Yet if he had a Living Will, then he would have been able to have made the decision himself, while alive. And that is what I tell people – that YOU are making the decision as to what happens to you. And in doing so, you are not putting that on anybody else. All you are doing is telling people to carry out your decision that you have already made, should that ever happen to you.

I share that story because, unfortunately, most people tend to wait too long before they consider officially filing the appropriate documentation with regard to Living Wills, Trusts, and Estate Planning. So many of us wait, not thinking that tragedy will strike, and then when it does, we are legally all for the worse.

It is not just the average citizen, though, that acts – and/or reacts – that way. It is the rich and famous, too.

Aretha Franklin’s family will most likely be finding that out now themselves.

The legendary singer, who passed away last week from a battle with pancreatic cancer at the age of 76, had no will or trust at the time of her death.

According to her attorney, in a report in the Detroit Free Press, Franklin just “never got around to it.”

Due to that inaction, Franklin’s family might potentially have a long legal road ahead of them – similar to when Ike Turner passed away. He, too, did not have a will, and his estate has been in litigation for 11-plus years.

With regard to Aretha Franklin, the laws in Michigan say that her estate is supposed to go to her children. But since she did not have a specific will or trust, other relatives can technically come in and try to get something from her estate. By not having a Will in place, it opens the door for other people to come in and argue that they should have a piece of the pie. They can go potentially go to court and argue that they have an interest and deserve a cut of the estate.

The cost to do so, though, is not just time. Many dollars are uselessly spent by families on attorney and other legal fees, in order to contest the estate and go through litigation matters. Depending on how much time respective attorneys need to put into various matters, it can cost thousands of dollars each year for families to go through the process. And how do those fees get paid? By monies held in the estate. Thus, the estate value lowers with each dollar spent on those fees.

Throughout my career, I have seen too many examples of families arguing over what many would perceive as petty issues. I have heard of family members feeling like they deserved more money than was left for them, so they spent thousands and thousands of dollars on challenging the Will, with the case still being in court. I have seen families arguing with one another about estates that had nary a dollar in it. And I have seen heartbreaking cases where a young loved one passes away, and estranged family members receive monies that other family members feel that they do not deserve.

And virtually all of this – be it with regard to the families listed above, your family, or even Aretha Franklin’s family potentially — could be prevented by simply finding the 30 minutes to visit with an attorney and fill out the proper Wills, Living Wills, and/or Trust documents.

As for my respective family?

Well, after both grandparents died in that crash, almost my whole entire family got Living Wills.

And as for me? It helped lead me here, to help you with yours.

Christina Miner is a Wills and Estate Planning Attorney with The Orlando Law Group. Her practice focuses on estate planning, guardianship, probate and trust administration. She has worked for private law firms, was assistant regional counsel for the Office of Criminal Conflict and Civil Regional Counsel – 5th District, and was senior attorney for the Florida Department of Children and Families. She earned her Juris Doctorate from FAMU College of Law, and earned her bachelor’s and master’s from the University of Central Florida.

To contact Christina, visit www.TheOrlandoLawGroup.com or call (407) 512-4394.

Members of the media wishing to contact Christina or any other OLG attorney should call 20 A-M COMMUNICATIONS at (407) 917-20AM (2026).

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hammer

The Pros and Cons of Testamentary Trusts in Florida

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A trust is a formal arrangement made with a trusted person, or trustee, which conveys property as directed by you. Trusts can be created during your lifetime. These trusts are known as an inter vivos trust, or more commonly as a living trust. Such a trust remains in effect regardless of whether or not they contain property until your death.

But trusts can also be created upon your death. Such trusts are known as testamentary trusts, and as is the case with most everything in this world, there are positives and negatives that go along with it.

A testamentary trust is created through your Last Will and Testament. The trust is not actually created until the person that created the Last Will and Testament passes away. Upon their death, the trust is only then considered created and funded. As the Will does not go into effect until the time of your death, the trust also does not and is not funded until then. Generally, these trusts are created for young children, relatives with disabilities, and others who may be inheriting a large sum of money.

So, why should you create a testamentary trust?

THE PROS:

Testamentary trusts, as an item in your will, fall under the jurisdiction and oversight of the judge and the court. This gives your trust several extra pairs of eyes that determine whether legal requirements have been met. When a trust is created, a trustee is named, and that trustee is responsible for administering the trust according to its terms and on behalf of the beneficiaries. Court oversight ensures that your trustee will cooperate accordingly, should they violate a mandate of the court, or should they act in a manner that goes against your wishes or original purpose of creating the trust.

This is particularly helpful as it ensures that your wishes will be followed to the letter and that your beneficiaries will not have to deal with any daunting issues brought about by mistakes made by your trustee in fulfilling legal requirements.

Furthermore, unlike living trusts or inter vivos trusts, which are created while the creator of the trustee, or the trustor, is still alive, a testamentary trust is created through your Last Will and Testament. Rather than drafting an entirely new and separate document outside of your Last Will and Testament, your estate planning attorney will simply add additional language to your Last Will and Testament, often referred to as “testamentary trust language,” for a slight additional fee. This means that a testamentary trust is often less costly and more simple to create as compared to a living trust or inter vivos trust.

Funding a testamentary trust also tends to be far more simple than funding a living trust, as it is possible to include language in your Last Will and Testament which directs that the testamentary trust be funded by a life insurance policy that pays out when the creator of the Will dies.

A testamentary trust also allows its creator to maintain full control of their assets, such as their property or properties, until they pass away. Until they die, the creator of the trust may amend the terms of the trust or altogether revoke the testamentary trust.

THE CONS:

As this is an item in your Will, the trust is funded during probate, and thus will have to go through the sometime stressful and costly process of probate. During the probate proceedings, assets will be transferred to the trust by a probate lawyer. As the trust passes through probate court, the trust will be held to the Florida probate filing fee. Probate also takes time, with small estates lasting in probate court for a month or more, while medium-sized to larger estates can take several months or even years to process.

Also, the terms of your testamentary trust will be a matter of public record, so anyone can see what you are looking to do with your money. This can be a negative for anyone who values their privacy.

As with any trust, your decision as to who you will name as trustee is incredibly important,  as they will maintain a significant degree of control over the trust and its assets after you have passed away. You will want to make sure that you take the necessary time to consider who is the best choice to serve as trustee, and you will need to ensure that the person you select is trustworthy, reliable, and willing and able to perform the duties required of them as set in the trust.

At the end of the day, whether a testamentary trust or an inter vivos trust is right for you is primarily dependent upon your personal preference. Do you want to avoid probate? Do you think you’ll need court oversight? Is having your trust as a matter of public record problematic for you? Once you answer those questions for yourself, and once you consult with an experienced estate planning attorney as to all of your estate planning options and whether they are right for you and your goals, you will have a better understanding of what kind of trust you want, and how the process will work for you and your trustees.

The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Debunking the Myths of Probate

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MYTH: The Probate Process Lasts for YEARS

Truth: The vast majority of estates actually pass through probate court quite quickly. There are some factors that could lead to an elongated process. Those include continued income generated by the estate (Like that of a celebrity), family fighting, or if the estate is massive in size.

MYTH: Avoiding Probate Saves Money on Taxes

Truth: Sorry, but no. Estate taxes are determined under the tax law, which exists separately from probate rules.

MYTH: Probate Will Eat Up Most of the Estate’s Funds

Truth: In most cases, probate costs less than five percent of the estate value. Even that is only the case when you’re actually required to go through for formal process. Not all estates are required to do it.

MYTH: All of an Estate’s Assets Pass Through Probate

Truth: Nope! Assets titled in your name are the only ones that will pass through probate. Any jointly titled assets will pass outside of probate to the surviving owner or owners. IRA’s, retirement plans, and life insurance plans will also pass outside of probate as per your designation of beneficiaries.

MYTH: My Information Will be Kept Confidential

Truth: Not true at all. Any information that passes through probate will be a matter of public record.

Probate is a highly detailed process, which most people do not have any in-depth knowledge of. For assistance in creating your Will, it is always best to seek the aid of an attorney. The Orlando Law Group stands at the ready to assist you through this process. Call 407.512.4394 to book a consultation today!

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One of the most important decisions a person can make in regards to their estate plan is the choosing of an executor to carry out their wishes after they are gone. Choosing the right executor for your estate will help to make the transition seamless for your loved ones, and ensure that your wishes are met. So, what should one look for when assigning this vital role? What are the qualities that make an executor great? How can you select someone with full confidence, knowing that they will uphold your orders when you are not there to enforce them?

An executor is the person or institution selected by you, that will carry out your final wishes and administer your estate after you have died. Some of the duties that fall to this important position include: filing court papers, beginning the process of probate, utilizing the funds of your estate to settle outstanding debts and funeral costs, putting together an inventory of your estate, seeing to outstanding details like notifying government agencies of your death and terminating credit cards, preparing and filing income tax returns, and distributing your assets to the beneficiaries you’ve named in your will.
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How to Choose the Best Executor for Your Estate

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Estate planning is the process of creating documents that legally determine how your assets will be distributed after your death, including who inherits, who controls the distribution of your assets, and when your beneficiaries receive your assets. While most of us do not like to think about dying, we all want to care for our families when the unpleasant inevitable occurs, and estate planning allows us to do just that.

The first step estate planning is to account for all of your property, such as real estate, personal property, life insurance, bank accounts, retirement plans, securities, and business interests. Once you have an accurate picture of what is in your estate, you can easily make decisions about who should inherit your assets and how.

People often believe they do not need an estate plan because they do not think they are “wealthy” or that they have an “estate.” Everyone has an estate that needs to be planned – it is only a matter of how large it is. Creating an estate plan allows you to decide what happens to your family and your assets at your death and helps to provide you with peace of mind as to the protection of your legacy after you pass away.

One of the less talked about, but equally important aspects of creating an estate plan is making sure that you choose the right executor or personal representative for your estate. A personal representative is a person, appointed by the decedent’s Will or the court, to manage and administer the decedent’s estate and its associated assets. The personal representative may be the executor, who is the person named as such in the decedent’s Will; the successor to the executor; or an administrator appointed by the court where the decedent died without a Will naming an executor (this is referred to as intestate, or intestate succession). The terms personal representative, executor, or administrator can essentially be used interchangeably.

Generally, anyone can be an executor or personal representative, with a few major exceptions which differ by state. Florida law states that an executor must be at least 18 years old, cannot be a felon, and must be mentally and physically capable of serving (must not be determined legally incapacitated by a court).  While it is usually best practice to name someone who lives close to you, Florida law does have requirements for naming out-of-state executors. Namely, the non-resident executor must be related to you by blood, marriage, or adoption.

It is imperative that you made the right decision as to who will serve as the executor for your estate, as this person will have a significant degree of control over your assets and, in turn, your legacy after you pass away. But what are some the factors and questions you should ask yourself prior to deciding who will serve as the executor of your estate?

First, while this can be easier said than done, while making this important decision as to who should serve as your estate’s executor, you should choose someone based on their suitability for the role in a practical sense rather than based on emotional considerations or their relation to you. While many people may want to choose their son or daughter to serve as executor of your estate, this may not be the best decision based on practical concerns. For example, if you know that your son or daughter has had difficulties in the past with managing money or assets or you know that their personal wishes do not necessarily align with your personal wishes and goals for the administration of your estate, another person may be a better choice. While it can be challenging to remove your emotions from this potentially difficult decision, it is important to remember that estate planning is done for the protection of your estate, your family/friends, and your legacy, and as such, your own wishes for your estate are key. You want to pick someone that you can trust to follow your wishes and administer your estate exactly as you have directed, who will not disregard your wishes for their personal goals or benefit.

Trust is obviously a major factor in choosing an executor, and as such, many choose a family member of close friend. The most common choices for an executor often include spouses, children, or siblings. The key qualities for an effective executor include honesty, communication, and organization.  The distribution of assets can become a nightmare if handled by someone with lacking organizational or communication skills. You will also want to ensure that your choice is someone who is both personally and financially responsible. It is also a good idea to name an alternate executor, in the event your first choice does not work out or something happens to your first choice, such as death, incapacitation or major illness.

If you do not have a friend or family member with these skills, then it might be time to look outside of your circle and hire a professional. Third party executors can include banks, attorneys, and trust companies, to name a few. The Orlando Law Group provides this service, acting on your behalf after the event of your death to ensure that the burden of handling your estate is undertaken by professionals. Choosing a professional executor can also help to lessen the burden placed on your family and friends during a difficult time.

The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Guest Blog By Wanda Talley Schebel, CPA

Often, your CPA and your attorney are the ones most involved with handling your confidential financial information. Your attorney can help you draw up plans, establish trust accounts and delegate beneficiaries. Since your accountant regularly has access to your financial information, they can help guide you through following the plans as they are put into place. Your CPA typically advises on how to minimize tax liabilities through gift giving, insurance policies, trust accounts, and handling after death financial responsibilities. 

 

Estate planning does not have to be expensive. Your plan will develop and change as your needs and financial situations change. Most people don’t give it much thought and most people have good intentions, but an innocent mistake can create problems for your family.

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CPA’s and Attorneys Partner to Aid Your Estate Plan

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Your CPA can help you determine the value of your estate and figure out how to reduce the tax liability. For example, you can reduce the overall size of your estate by spending some of that hard-earned money beforehand. You probably have already chosen whom you want to leave your assets to after you die. If you can afford it, give some gifts now. Enjoy seeing the results and appreciation of your gifted assets.  Federal law lets you give $14,000.00 a year ($28,000.00 if you are married) to as many people as you wish tax-free.

You can also remove the value of your life insurance from your estate by transferring ownership of the policy to an Irrevocable Life Insurance Trust.  This can reduce or even eliminate estate taxes, so more of your estate can go to your loved ones. The benefits will not be included in your estate as long as you live 3 years after the transfer of the existing policy.

You can also convert stocks and investment real estate into a Charitable Remainder Trust. This is beneficial as you get an immediate charitable income tax deduction and it removes their financial value from your estate.

There are many options when it comes to estate planning.  All of which your attorney and accountant can assist you with. The best benefit is peace of mind.

 

Wanda Talley Schebel CPA, has been providing quality, personalized financial guidance to local individuals and businesses throughout Central Florida for over 25 Years. Her expertise ranges from basic tax management and accounting services to more in-depth financial planning for clients of all incomes. She has represented many clients before the IRS. Wanda has taught the IRS VITA classes and holds seminars on business management and budgeting. She is a licensed Certified Public Accountant in both Florida and Louisiana. 

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Living Trust vs. Will: Know the Differences

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Estate planning is the process of creating documents that legally determine how your assets will be distributed after your death, including who inherits, who controls the distribution of your assets, and when your beneficiaries receive your assets.

The first step estate planning is to account for all of your property, such as real estate, personal property, life insurance, bank accounts, retirement plans, securities, and business interests. Once you have an accurate picture of what is in your estate, you can easily make decisions about who should inherit your assets and how.

To create your directions for distribution to whom you want and how you want, typically you will work with an attorney to draft one of two types of documents – a Will or a Revocable Living Trust.

  • A Will, or Last Will and Testament, is the fundamental piece of any estate plan. A will functions to provide your instructions for distributing the assets you own individually or share ownership as tenants in common when you pass away. A will can also work in conjunction with a Revocable Living Trust at your death to “pour over” any assets that you did not transfer to the trust during your lifetime.
  • A Revocable Living Trust is an alternative in many ways to a will. A trust is a legal agreement where you transfer your assets to a trustee who holds title to the assets on behalf of someone else (your “beneficiary”). A beneficiary can be you, your spouse, your children, or others. A Revocable Living Trust allows you to transfer all (or part) of your assets during your lifetime into a trust to be held on behalf of your beneficiaries. You can name yourself or another person or institution to serve as Trustee, depending on who you want to manage your assets. As a revocable trust, you usually can change the terms of the trust and who the beneficiaries are at any time before you pass away.

LIVING TRUST:

What is a living trust? A trust is a formal agreement you make with a trusted person, or trustee, to convey property as directed by you. A living trust is a trust that you create during your lifetime. These documents are in effect regardless of whether or not they contain property until your death.

Perhaps the greatest asset to utilizing a living trust is the ability to avoid probate because they pass to beneficiaries under the terms of the trust and not a will. Probate is the court system in which a person’s affairs are wrapped up subsequent to their death. Probate is costly, lengthy, and unnecessary for most estates. By dividing your property in a living trust, you are able to avoid this process and future headache for your loved ones. Property can be distributed to beneficiaries after the death of the grantor without incurring any fees or court interference.

Another benefit of a living trust is that it remains private. The contents of a will become a public document. Many people choose this route to keep their affairs private.  Also, while wills can be challenged through lawsuits, it is infinitely more difficult to attack a living trust.

Unlike wills, however, a living trust requires the signature and stamp of a notary public. Also, while a will can appear in any format, property left through a living trust must be first transferred into the trust. For items such as real estate, which include title documents, retitling must occur so that the owner of the property is the trust.

WHY A WILL THEN?

You might be asking yourself, if I have a living trust, then why is creating a will even necessary? Make no mistake, wills are vital documents to include in your estate plan. First, a will is the primary estate planning document which regulates your wishes in regard to your inheritance and guardianship. A will can pass on certain rights that a trust cannot. It is only in a will that you can name legal guardians for children, as well as someone to manage any properties left to or earned by minors.

A will also gives you the right to name an executor who will be in charge of wrapping up your estate after your death. That person communicates with the court, pays your bills, and eventually distributes any property that has to first pass through probate. Living trusts do not allow for an executor, and rather names a successor trustee who will solely manage the property left through that trust.

A will also gives you the ability to leave instructions regarding how you want your debts and taxes to be paid, as well as forgive any debts owed to you. Wills are far simpler to create and require only the presence of two witnesses who will not receive anything under the will.

IN CONCLUSION:

Both a living trust and a will help the process of divvying up your estate and can each accomplish different tasks to make the entire ordeal less harrowing for your beneficiaries. However, keep in mind that a living trust and a will are not the only estate planning documents a person may need. There are several other estate planning documents which may be right for you and your goals, such as a Power of Attorney, Living Will, HIPAA Release, a property deed, and more. To create the most comprehensive estate plan which accounts for each of your wishes and goals for your estate, you should consult with an experienced estate planning attorney, who will counsel you on the best options for you and your estate.

The presence of experienced and knowledgeable attorneys is vital to the process. The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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When should an estate plan be reviewed?

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An estate plan is an important asset that should be updated as time goes on. Ideally, your estate plan should be reviewed annually or even quarterly, although it’s acceptable to update it at least every three to five years or when there is a life event, according to Fidelity.

What qualifies as a “life event?” Things like:

  • Marriage or divorce
  • The birth of a child or grandchild
  • A purchase of a home
  • Moving out-of-state
  • A death in the family
  • Career changes
  • When you receive an inheritance or significant asset
  • And more

There are all examples of life events that should make you pause and review your current estate plan.

Any large life changes will have a direct impact on your estate plan, and sometimes for reasons you may not even be aware of. When you have an important life event, it is best to consult with your estate planning attorney for the best plan of action.

Remember, life is dynamic. Things are constantly changing. If you haven’t reviewed your estate plan in a while, it might be time to seek counsel from your attorney to make it is up to date.

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When is the Right Time to Begin Estate Planning?

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What exactly is estate planning? It is twofold: (1) it is deciding what will happen to your possessions and assets and making sure that your family and friends are taken care of after you have passed away, and (2) it is ensuring that your health care and end of life care wishes are carried out if you fall ill or become incapacitated.

While most people do not want to think about death and what happens when they die, it is still important to begin planning for a time when you will no longer be around while you are still in good health both mentally and physically. After you pass away, even if you have verbally communicated to your family how you would like your estate to be administered; without a written, official estate plan in place including documents such as a Last Will and Testament and a Living Will, there are no guarantees that your estate will be dealt with in the way that you had hoped for. Establishing a solid estate plan is the only way to ensure that your estate and health care is administered according to your wishes.

First, developing a plan for how you will divide up your assets before you pass away allows you to decide what happens to your assets, instead of allowing a relative or friend (who may have their own motives or personal goals as to what will happen to your possessions) or the courts to decide how your estate is administered. When a person dies without any type of will or trust set up, all of their financial assets and property are subject to the laws of the state. This is referred to as dying “intestate,” or intestate succession. Simply put, you will have no control over who inherits what you once owned. Everything will be left up to pre-determined laws that have been set up by the state you live in.

Furthermore, when you pass away, your friends and family will already have enough of a tough time coping with the emotional burden that comes with a difficult loss. Making it easy for them to handle your estate by providing them with written documents setting out your goals and wishes for your possessions is a great gift to give your friends and family. Having everything pre-planned will give your loved ones time to grieve and reduce the stress of fairly dividing your assets according to your wishes.

Lastly, if your estate is subject to taxes, a proper estate plan can help reduce or even eliminate these taxes, allowing your family to retain most of your assets instead of handing them over to the state.

As to the right time to establish an estate plan; many would say that the right time to begin thinking about estate planning is when you become a legal adult; others could say that it is when you become a parent or guardian of a child; while some might say it is when you retire or reach a certain age. However, speaking frankly, there is no “right” time to begin thinking about estate planning, because each person and each family is different. Quite frankly, any time is a good time to begin estate planning once you become an adult, because life, as we know, is unpredictable. Any time is a good time to consider the wellbeing of your family, friends and possessions after you pass away. The important thing is that you do not wait too long to set up an estate plan. After you pass away or become incapacitated, it is too late to create a solid estate plan, and your friends and family may be left both emotionally upset by your loss and stressed, with many questions as to your wishes for your estate or health care.

When it comes to establishing an estate plan, it is most important to think about your specific goals for your estate and how you want your legacy to protected. Do you want to make sure your children have a guardian in place should you pass away or become incapacitated? Do you have multiple assets and want to ensure that your chosen beneficiaries receive your assets as directed? Do you have specific wishes for your end-of-life care should you be incapacitated? These are just some of the considerations you should make when thinking about establishing an estate plan.

If you decide to move forward with an estate plan, you will need to include a few important documents to make sure that all your bases are covered. A typical estate plan will include:

  • a Last Will and Testament that is the primary document regulating your wishes as regards inheritance and guardianship;
  • a Trust that relates to protecting assets for the benefit of yourself and/or specific persons;
  • a Living Will (also called a healthcare directive and proxy or designation of healthcare surrogate) that specifies your intent as regards decisions on your physical well-being and end-of-life arrangements respectively;
  • a Power of Attorney that enables a trusted Agent to make financial decisions for you in the event that you are incapacitated; and
  • for parents with minor children, a temporary guardianship document that names a trusted adult to care for minor children in the event of your incapacity.

Keep in mind that the specific documents you need will vary depending on your situation and your goals for your estate. A lawyer can help you clarify how to move forward with your estate plan and deal with any special circumstances you would like to consider. The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Deciphering the Jargon: What is a Living Will?

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Last Will and Testament, Living Will, Living Trust, Testamentary Trust, Power of Attorney, HIPAA Release, Quit Claim Deed, Enhanced Life Estate Deed…these are all terms we hear thrown around when thinking about establishing an estate plan. We know that as responsible adults we should plan for our future by creating a Last Will and Testament, but creating a comprehensive estate plan which accounts for the distribution of your assets, the security of your friends and family and what health care decisions should be made on your behalf involves much more than just a will.

The truth is, establishing an estate plan is rarely urgent (until it becomes urgent) and they are only needed when something awful happens. The result is that we often avoid tackling the whole mess.

However, developing a comprehensive plan for your estate can be quite simple and straightforward if you understand the basics and if you have the assistance of an experienced estate planning attorney on your side. When you are planning for what happens to your estate, it’s important to understand the difference between the different legal documents that are available to you, so you can ensure everything goes according to your plan. One of these such documents is known as a Living Will. While most people know what a Last Will and Testament is, or at least have an idea of what a Will does, many people do not know about Living Wills and how a Living Will can ensure that your wishes regarding your health care and end of life care are followed.

What is the difference between a Last Will and Testament and a Living Will, and why do you need a Living Will along with a Will?

A Living Will is a binding document to specify your medical wishes if you can’t communicate because of illness or injury. With a Living Will, a person expresses what he or she would like done regarding end-of-life care. In a situation where the attending physician and another consulting physician have determined that there is no probability of recovery from a medical condition, the Living Will can direct that life prolonging treatment be withheld. The person can indicate which of the three situations where they wish for life-prolonging treatment to be withheld: persistent vegetative state, terminal condition or end-stage condition. It addresses such questions as to whether you want life extending treatment while terminally ill or in a permanent coma.

A Last Will is the fundamental piece of any estate plan. A Will functions to provide your instructions for distributing the assets you own individually or share ownership as tenants in common when you pass away. It is only in a Will that you can name legal guardians for your children, as well as someone to manage any properties left to or earned by minors. A Will also gives you the right to name an executor who will be in charge of wrapping up your estate after your death.

A Last Will does not give directives about your health care or life support. That is where a Living Will comes into play. A Living Will, also known as an advance directive or a health care directive, spells out your decisions about life support and organ donation in advance. It also names someone to manage your healthcare, commonly referred to as your Health Care Surrogate or Proxy. To avoid any conflict of interest, your Health Care Surrogate can be a different person than the person named as Agent in your Power of Attorney, who is designated to handle your financial and legal affairs.

Why have a Living Will? There are two major reasons why someone may want or need to create a Living Will.

  • A Living Will spares your family the anguish of making life-support decisions without your input. It also helps to avoid major arguments between family members at a vulnerable time. With a valid Living Will, your wishes are clearly expressed so that your loved ones do not have make an incredibly difficult decision in a time of tragedy.
  • A Living Will also gives you control of your healthcare by ensuring that your doctor understands your end-of-life wishes and treats you accordingly. If you have specific wishes regarding your health care, certain religious beliefs, or are concerned that your family or spouse may not honor your wishes, a Living Will gives you the peace of mind that your wishes for your care will be followed.

To proceed with a Living Will, we recommend that you meet with an estate planning attorney who can walk you through the important legal questions at hand. Your attorney can prepare the proper documentation for your state and help you think through potential scenarios that you might want to discuss with your physician and loved ones. There are numerous medical scenarios and procedures you or your loved ones could face. By having a Living Will drafted by an experienced attorney, you can be clear about the specific medical treatments you do or do not wish to receive.

Many people think a living will is not something they need unless they reach senior citizen age. However, this could not be further from the truth. Life is unpredictable and often uncontrollable, giving every enough reason for adults of any age to invest in a Living Will in order to protect themselves when bad fortune arises.

The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Time for a check up

New Year? Maybe it’s Time for a Check-Up

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With the start of a new year just behind us, many people have been taking the time to reflect on the past year and re-prioritize their objectives as they head into 2016. For many of us, we have a goal of kicking off the new year with renewed vigor and a clear mission. We make lists and think of personal habits and business changes we want to make.

But, it’s also important to make sure your own affairs are in order. One important item to add to your 2016 list should be getting an estate plan checkup.

Everyone has an estate, and every estate needs a plan. Whether you consider yourself rich or poor, when you die you will leave behind assets. Your estate might include cash and investments, real estate, tangible personal property, or even an interest in a business.

At its most basic level, an estate plan determines how your assets will be distributed to those you leave behind when you pass away. Because of the ever-changing nature of tax laws, financial markets and the economy, an estate plan checkup is an important activity to revisit. Even if you already have an estate plan, it is imperative that you revisit that plan in order to ensure that it remains relevant under your current family and financial circumstances.

Just like an annual visit to your physician, a periodic review of your estate plan can either reinforce the fact that all is well and in order, or it can uncover the need for additional attention to return your plan to a healthy state. Keeping a keen eye on your plan will go a long way in avoiding disputes between your loved ones, as well as managing the amount of your hard-earned dollars that must go to cover federal and state estate taxes.
No matter what your net worth, a basic estate plan should include a valid will, durable power-of-attorney, health care power-of-attorney, and a living will. Some situations might also make it desirable to use a trust or series of trusts to accomplish your goals.

An estate plan check-up involves a review of the terms of all of these documents, with a particular focus on determining whether the persons you named to act in your absence remain appropriate, and whether the plan for distribution of your assets is still what you desire.

In addition to the implementation or review of your documents, your estate plan check-up should look at related issues such as the desirability of life insurance, disability insurance, or long-term care insurance, as well as the ongoing impact of pre-nuptial agreements or any other documents that affect your assets.

Estate planning is not a static event that you grudgingly do once and then forget about it. On the contrary, estate planning is a continuing process, because life is a moving target that is full of constant change, so your estate plan needs to change as your life changes. A periodic checkup will insure that all is healthy as you move into the future.

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Celebrating Octobers Best Hue

Celebrating October’s Best Hue

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October. The rest of the country might be sipping Pumpkin Spice Lattes and watching the colors change to oranges; but around here, it’s a time to THINK PINK! Pink ribbon, that is. 

According to the American Cancer Society, Breast cancer is the most common cancer among women in the United States (other than skin cancer). Nearly all of us know someone whose life has been turned upside down by a breast cancer diagnosis. The good news is that since the pink ribbon’s adoption a symbol for the breast cancer cause in 1992, awareness has skyrocketed and millions of women are surviving the disease.

What can you do to THINK PINK this October? We have two suggestions. 

First, be informed. Take the time to learn about breast cancer and early detection. The American Cancer Society website is a wellspring of information and has links so that you can consider volunteering and donating to the cause. As well, the Florida Breast Cancer Foundation has information about events specific to the Orlando area.

Second, let Breast Cancer Awareness Month serve as a reminder to all of us that sometimes bad things do happen. Despite our best efforts, sometimes the unthinkable diagnosis becomes a reality. When those moments do come, we can’t underscore enough how important it is to have an estate plan. Estate planning is not just for the wealthy. It’s for those among us who have any assets at all. It’s our opportunity to make sure our finances continue to accomplish our goals even after we pass on. It’s also a gift to the family and friends we leave behind.

This first-hand testimony from the Forbes website continues to inspire us as we serve our clients and seek to insure a smooth transition for families who are grieving. The author outlines her personal story of handling her father’s estate after he died from colon cancer. She shares that “The most unexpected financial lesson my father taught me came after he passed away. I am the executor of his estate. My dad was always a planner, but the things he did to make this process easier are amazing. I feel compelled to share them with just about everyone I know.” (To read her full, inspiring story yourself, check it out at Reader Story: What My Father’s Death Taught Me about Estate Planning.)

We realize that estate planning is never an easy topic. For one thing, it’s personal. For another, it feels a little morbid. Conversations about the details surrounding death take a lot of courage. But, they can also help avoid surprises, lead to better financial planning and promote family harmony.

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DIY Online Wills Are They Really a Good Idea

Do-It-Yourself Online Wills: Are They Really a Good Idea?

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Online legal document services offer an enticing bargain. Most people realize that they need an estate plan to manage their affairs if something happens to them, but having estate planning documents drafted by an experienced attorney can be expensive and time consuming. Furthermore, in times of the COVID-19 pandemic and when many people can accomplish nearly anything while in the comfort of their own homes, the idea of having your estate planning documents online is very attractive to the average person. For these reasons, many consumers are now questioning whether it is possible to skip the attorney fees and use a low-cost website to prepare estate planning documents. The short answer is that, yes, it is possible, but it is not recommended. You could save a few bucks now, but later may end up creating an expensive and frustrating mess for your family. Unfortunately, most people do not realize what they are getting themselves into with an online document service. This is because those online services have spent millions of dollars trying to create the impression that their services are similar to, or even equivalent to those of an attorney. They put lawyers in their commercials, hire celebrities to promote them, and tout stories of people who have successfully used their documents. Yet, all the marketing in the world cannot erase the simple truth. Those online services are not law firms, and the people who create them typically are not lawyers. Online services cannot give legal advice. Instead, they are “document assistants” – a term that various states use to define service providers who type your information into generic form documents. In other words, a document assistant is like a mindless typing robot who enters your information into a form, whether or not it makes sense and whether or not it is a good idea. If you are stuck or need advice, they cannot help you. If you make a huge mistake, they cannot warn you. In fact, it would be a crime for them to warn you. It does not matter if the person working on your documents via one of these service providers is an estate planning genius. That person is simply not allowed to give legal advice. Think of it this way: a person needs a state bar license in order to give legal advice, just the same way that a doctor needs a license to write a prescription. Giving legal advice without a license is very much like selling drugs without a prescription-it is a crime. To combat this, these companies design their generic forms so that even without legal advice, it is hard to make mistakes. That may seem like a good thing. However, the best way to make sure that your documents do not do anything wrong is to make sure they do not do or accomplish anything at all. Essentially, these documents become do-nothing, one-size-fits-all generic documents. That leads to the next problem with the online services. These document assistants cannot even promise you that the documents will work because they are not licensed attorneys, which means they cannot promise a particular legal result. Many clients are excited to learn that they can leave assets to a special needs child without jeopardizing government benefits; or that they can protect a child’s inheritance from frivolous lawsuits, divorce or bankruptcy. A well-designed estate plan ensures that your resources get where you want them and that they are used in the way you instruct. Estate planning is about creating legally enforceable provisions that do what you want done. These online document services cannot promise you any of that. They cannot promise you that you will achieve your goals. They cannot point out opportunities or other options beyond what you have selected, and they cannot warn you about hidden hazards. Really, all these document services can do is save you a few bucks. However, these document services play a clever price game, too. Most of these online services investigate what an attorney would charge for similar documents and then use that information to determine their pricing. These comparisons are misleading in a variety of ways. First, online services compare the price they charge for a single document to the price that an attorney charges for an entire estate plan, which typically includes numerous comprehensive documents. More importantly, there is no way to compare the prices of what you get from an online document service to what you get from an attorney, because they are not offering nearly the same thing that you would get from an attorney. If a fast-food restaurant told you that you could order their $1.79 “salad in a box” instead of paying $20 for a fancy restaurant salad bar, you would instantly recognize the faulty comparison. A wilted clump of lettuce in a plastic clamshell is not anything like an all-you-can-eat salad bar with every conceivable ingredient, made fresh and eaten in a nice environment with an attentive wait staff. Yet, most people recognize this faulty comparison because most people have experience with restaurants – both good and bad. They know how to judge quality, and they understand the “you get what you pay for” concept. But, when it comes to legal services, most people don’t have the experience to know better. If your estate plan is faulty or you do something wrong when drafting your own documents using an online service, you will never know. But, your family will know. If your estate plan doesn’t work properly, your family could end up paying the price and cleaning up the mess after you have passed away. Your estate plan is the box that carries your entire life savings. It is just not worth the risk of damaging your life’s work just to save a few bucks. The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida. If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form. If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Digital Estate Planning

Digital Estate Planning

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The two main classes of digital assets are 1) any online account that requires a username and password; or 2) any file stored in places including an individual’s computer, mobile phone, server, local DVD or CD-ROM, SD card or at online storage sites.

Online Accounts

If the client is the only person who has access to her online accounts, then what happens when she dies? Much of the concern involves the rights of the online company, which were granted when the individual initially accepted the account’s Terms of Service (TOS). Several issues to consider for online accounts requiring a username and password include the following:

  • The TOS Agreements of most popular online companies rarely, if ever, allow for the immediate or automatic transfer of the account to the personal representative.
  • Without access to a decedent’s bank and investment accounts, a trustee or executor will have difficulty obtaining necessary information for meeting the requirements of the underlying will and trust.
  • Without access to a decedent’s email, blog or website, the personal representative may not even be aware of certain ongoing obligations, especially with more transactions occurring online only.

Digital Files

Files on an individual’s computer are difficult Digital estate planning enough to find, depending on the individual’s levels of organization or disorganization. The personal representative’s job can become exponentially more difficult if the important data is stored offsite. Additionally, there are two main kinds of digital files to consider:
Client-Created Files – including scanned financial files, address books, and digital photos, but can also include valuable business documents or intellectual property.
Client-Purchased Files – including music, videos and e-books bought during the individual’s lifetime. In the typical TOS, the seller only grants the individual buyer a non-transferable license to use the work “for life.”

Steps You Can Take Now

Make a list of all digital assets. This should be a comprehensive list of all of your online accounts and data files, including email accounts, websites, hard-drives, important Word and Excel documents, online storage accounts, and social media accounts.
List wishes for each asset. For local hardware containing data files, this can include leaving the asset directly to a specified heir. For online accounts, this can include:

  • Shutting down the account
  • Doing nothing
  • Archiving contents on CD or DVD
  • Creating an auto-response on the account; and/or
  • Forwarding all messages to another place
  • Choose the person who will receive each asset
  • Provide access and control to the recipient
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Why Family Members Fight Over Inheritance

Why Family Members Fight Over Inheritance

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People who are normally kind and in tune with their emotions revert to fighting children, figuratively, sometimes literally, scratching, punching, and pulling each other’s hair. Even where there is no obvious conflict, it seems that nearly every family has some amount of tension permeating just beneath the surface as they address family inheritance issues.

Stories of families in conflict at the death of a loved one are regular fodder in the media. It is easy to mock them; they look ridiculous, and it all seems so petty. We wonder why people just can’t get along. But, after some study I have learned that what appears as greed and pettiness are really symptoms of survivors’ struggle to feel loved and important. The fight for money and things – Dad’s golf clubs, Mom’s necklace – is not about the object or the money itself, but about what they symbolize: importance, love, security, self-esteem, connectedness, and immortality.

The old saying that “money makes people do funny things” doesn’t do justice to the real problems and root causes of family conflict. Money is not the core reason that fami¬lies fight; money is how we keep score in the fight for the intangibles of love, approval, and primordial survival. Money and possessions also help allay the fears of those left behind. When families fight, greed is rarely the principal motive.

The feuding family members can always trace their problems back several years, if not all the way back to childhood. For some, the trouble starts with the involvement of non-family. It is clear that inheritance conflict doesn’t come out of the blue; it is a continuation of long-term relationship problems that resurface upon the illness or death of a loved one. And they aren’t just about money or greed; they are about more, much more. But what is it that so often drives people to wage war against their own flesh and blood over a loved one’s estate?

There are five basic reasons why families fight in matters of inheritance:

  1. Humans are genetically predisposed to competition and conflict.
  2. Our psychological sense of self is intertwined with the approval that an inheritance represents, especially when the decedent is a parent.
  3. We are genetically hardwired to be on the lookout for exclusion, sometimes finding it when it doesn’t exist.
  4. Families fight because the death of a loved one activates the death anxieties of those left behind.
  5. One or more members of a family has a partial or full-blown personality disorder that causes them to distort and escalate natural family rivalries into personal and legal battles.

These sources of family conflict are not mutually exclusive; in most cases, some combination of the five elements present themselves in a combustible cocktail of family rivalry and conflict.

A significant number of inheritance disputes also involve testators and beneficiaries who come from dysfunctional families, are mentally ill or addicted, or suffer from one or more of the four Cluster B personality disorders as defined in the Diagnostic and Statistical Manual (DSM IV): antisocial, borderline, histrionic, or narcissistic.

Despite the tensions and rivalries that naturally exist in all families, family conflict is not inevitable. As family coun¬selors we can help families overcome the natural tensions that tend to pull them apart in order to preserve their most valuable asset: family itself. We can counsel our clients on the pitfalls of various courses of action, dissuade them from provisions that are punitive, encourage them to mend fences while family members are still alive, and promote planning that leaves a legacy of love.

More than just scriveners, clients look to their estate plan¬ning counsel to advise them on what is fair and customary. We use our legal and personal skills to document their wishes while being sensitive to the needs of those left behind. Special care must be taken to not upset long-held roles when allocating personal and financial assets and in appointing fiduciaries. We can also protect our clients from predators from within the family and without who are most likely to manipulate and abuse. In short, we can make a difference. Our clients are also good teachers, instructing us on the importance of family, the transience of money and things, and the shortness of life.

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Do You Have a 401k You Need to Incorporate Into Your Estate Plan

Do You Have an Older 401(k) You Need to Incorporate Into Your Estate Plan?

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When you meet with your Estate Planning lawyer, initially, they may ask you some of these questions: “Do you own a home?” “Do you own a business?” “Are you married?” The fact gathering necessary in an initial interview does not always allow the sort of leisurely chat friends would have over coffee. It’s important for your lawyer to gather the basics in the initial meeting, if no open ended questions are asked then assets important to your situation can be overlooked.

For example, approximately 4.2 trillion dollars is held today in 401(k) and other defined contribution plans. For public sector employees, a defined contribution plan may include a 403(b) or 457(b) plan. The amount of assets held in defined contribution plans is projected to grow in the future given that in the private sector and possibly even the public sector, a regular pension or defined benefit is going the way of the Dodo bird. While going forward employers may still provide matching or non-matching contributions to an employee’s account, the trend is clear that fewer em­ployees and retirees in the future will be able to depend on a monthly pension check.

A 2009 study by human resources consulting firm Hewitt Old 401k Estate Planning Associates (now Aon Hewitt) concluded that 29 percent of former workers leave their 401(k) with a previous employer. This amounts to a huge sum of assets held by American workers that can be overlooked if you are asked only “do you currently have a retirement account?” The same study also stated that two-thirds of employers report that the company 401(k) plan is the primary retirement savings vehicle for employees. Clearly then gathering information regarding an old 401(k) plan is an important step in assessing your unique situation.

Determining the existence of an old 401(k) becomes even more important in the context of trust administration and probate. If you are a surviving spouse or beneficiary of someone who was not the plan participant, knowledge of the 401(k) can be even more diminished.

Your lawyer will need to ask you open ended questions about your history to discover unclaimed 401(k) assets. If your old employer no longer exists because of dissolution or merger, there are other ways your lawyer can use to find that information.

Up to date beneficiary designations are critical and you should review them at a minimum upon the major life events of birth, death, marriage, and divorce. Helping discover whether any 401(k) assets are unclaimed facilities a discussion about current assets and whether those beneficiary designations are also up to date.

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What Estate Planning Attorenys Really Do

What Estate Planning Attorneys Really Do

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Everyone seems to know that estate planning something that you should do, but they are either unaware of what crafting a complete estate plan entails beyond just having a Will drafted, or they choose to put off having their estate planning documents prepared until it is too late. It can be uncomfortable to talk about what many people mistakenly believe estate planning is all about — dying and the resultant loss of control. Or you may think that estate planning is just for the wealthy or elderly.

For example, many young, single people who do not have a lot of money or any children often believe they do not need an estate plan because they do not have much to leave to anyone, thinking that because they do not have much, they do not have an “estate.” However, this is a misconception-everyone, which rich or poor, old or young; has an estate. Creating an estate plan would help your parents pay for your funeral and burial, as well as make sure that your parents can access your assets if something happens to you, which could include your bank account, personal possessions, or life insurance policies.

A comprehensive estate plan typically also includes health care directives such as a Living Will and a HIPAA Release, which can be a great gift to your parents or guardian in ensuring that you are cared for per your wishes and that they can receive all necessary medical information to make any important decisions on your behalf.

As uncomfortable as it may be, planning for the future after we pass away is something we and our family members or friends are all going to have to deal with at some time, especially if we have heirs or a spouse that we will leave behind. You do not have to be rich or elderly to plan for your belongings and money to go to whom you choose when you pass away. An experienced estate planning attorney can help you protect your family and your assets and can also help you protect your life and your legacy.

First, what is estate planning? Estate planning is the process of creating documents that legally determine how your prized possessions will be distributed after your death, including who inherits what assets and who controls the distribution of assets.

A typical estate plan will include, but is not limited to:

  • a Last Will and Testament that is the primary document regulating your wishes as regards inheritance and guardianship;
  • a Trust that relates to protecting assets for the benefit of yourself and/or specific persons;
  • a Living Will (also called a healthcare directive and proxy or designation of healthcare surrogate) that specifies your intent as regards decisions on your physical well-being and end-of-life arrangements respectively;
  • a HIPAA Release that allows the individuals you have named as surrogates or alternates to have your medical records released to them;
  • a Power of Attorney that enables a trusted Agent to make financial decisions for you in the event that you are incapacitated;
  • a property deed, such as an Enhanced Life Estate Deed, to allow for the transfer of your property without the need for probate proceedings; and
  • for parents with minor children, a temporary guardianship document that names a trusted adult to care for minor children in the event of your incapacity.

It is easy, and even natural, for the average person to think of estate planning as a somewhat melancholy area of law, which is not necessarily untrue. Estate planning deals with the often uncomfortable and sad topic of death, which is a topic that most people avoid dealing with until it is absolutely necessary. However, estate planning is more than just talking about death and what happens after death. Here is what estate planning attorneys really do:

  • We make sure the right people care for our client when the client cannot do so themselves, such as when our clients are incapacitated or determined unable to make decisions on their own.
  • We place our clients’ wishes and personal goals for their estate as our top priority.
  • We ensure the right people care for our clients in the event that they become ill or incapacitated, and we ensure that their loved ones are cared for in the event of our client’s passing.
  • We provide our clients and their families with the peace of mind that their assets and personal possessions will be taken care of and in the right hands after they pass away.
  • We work to assure our clients that their wishes and personal goals for the administration of their estate will be followed.
  • We safeguard and make certain that our client’s legacies — monetary and moral — are passed along to the client’s loved ones.

We believe it is important to reframe how the average person thinks about estate planning. It is not solely about death and administering assets – estate planning is about protecting the legacies of our clients for years to come, and ensuring the our clients’ wishes are followed and that their loved ones are properly cared for. It is an essential mission which we do not take lightly. We are proud to serve our clients each and every day in protecting their legacy by establishing an estate plan that is comprehensive and accounts for each of our clients’ wishes.

The attorneys at The Orlando Law Group represent and prepare estate planning documents for individuals throughout Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout central Florida.

If you are dealing with an estate planning issue or are looking to establish your own estate plan, please reach out to our office at 407-512-4394, fill out our online contact form.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

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Funding Your Trust

Funding Your Trust

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A clear plan for the transfer of assets is crucial to the success of any estate plan. But our best plans will fall far short of expectations if the trusts are never properly funded.

Here’s an analogy: If the trust is the car, the funding is the fuel. Without gas in the tank, that beautiful sedan with the precision engine is just metal on four wheels. It’s not going anywhere. The same holds true for an estate plan. Until it’s properly funded, the plan is just a plan – a plan that can’t be executed. Like the car with the needle on empty, it’s not going to take you anywhere.

With basic wills, most of the funding happens after death through the probate process. By contrast, a trust can – and really should – be funded while the trust maker is still alive. With proper trust funding, you can be assured that your designated assets will be governed by the terms of the trust agreement. Without it, assets not properly transferred to the trust will generally fall to probate.

Proper trust funding involves moving assets that are in your name and retitling or reassigning them to the trust. These assets fall under three main categories:

1.     Personal property and real property with title (home, car, boat, etc.)

2.     Non-titled property (computer, furniture, artwork, tools, etc.)

3.     Property that passes by beneficiary designation (life insurance, 401(k), etc.)

In certain instances such as incapacity, the General Durable Power of Attorney can be useful in funding a trust. This ancillary document allows the agent acting under Power of Attorney to transfer assets or update beneficiary designations. Additionally, where property remains in the individual’s name at the time of death, the Pour-Over Will can be a “last step” measure to redirect the assets into the established trust. These special instances, however, underscore the importance and the advantage of acting early to properly fund a trust. By doing so we greatly diminish the need for the Durable Power of Attorney and eliminate any need of the Pour-Over Will.

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Ttrust Decanting Power to Appoint in Further Trust

Trust Decanting: Power to Appoint in Further Trust

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Whenever an Independent Trustee may distribute assets to or for the benefit of a beneficiary, our Trustee may appoint the property subject to our Trustee’s power of distribution in trust for the benefit of one or more beneficiaries of any trust created under this instrument under the terms established by the Independent Trustee. Any trust established by the Independent Trustee and funded by the exercise of the power granted under this Section must meet these requirements:

  • The trust must not reduce any fixed income, annuity, or unitrust right provided by this trust instrument to any beneficiary.
  • The trust must provide for one or more of the beneficiaries of a trust created under this instrument.
  • The interests of remainder beneficiaries of the trust created under this instrument must not be accelerated under the terms of the new trust.

We request the Independent Trustee consider including a provision in the new trust that permits our Trustee to distribute as much of the trust principal to the beneficiary of the trust as an Independent Trustee advises so that the beneficiary’s estate can utilize the basis increase allowed under Internal Revenue Code Section 1014 after the beneficiary’s death without causing an increase in the federal estate tax.

An Independent Trustee may not use the powers granted under this Section to extend the term of the new trust beyond the period of perpetuities provided under the governing law of this instrument.

Any trust created under this provision must not contain any provision that, if applicable, would cause the trust to fail to qualify for the marital deduction or charitable deduction, fail to qualify any gift to the trust for any gift, estate, or generation-skipping transfer annual exclusion, or disqualify the trust as a qualified subchapter S corporation shareholder.

If any beneficiary holds a presently exercisable right to withdraw property from this trust, that right may not be defeated by the exercise of the Independent Trustee’s powers granted under this Section.

The Independent Trustee’s powers granted under this Section are not diminished by the revocability or subsequent irrevocability of the trust created under this trust.

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Who should be your successor trustee

Who Should Be Your Successor Trustee?

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If you have a revocable living trust, you probably named yourself as trustee so you can continue to manage your own financial affairs. But eventually someone will need to step in for you when you are no longer able to act due to incapacity or after your death. Because successor trustees have a lot of responsibility, they should be chosen carefully.

If you become incapacitated, your successor will step in and take full control of your finances for you—paying bills, making financial decisions, even selling or refinancing assets. Your successor will be able to do anything you could with your trust assets, as long as it does not conflict with the instructions in your trust document and does not breach fiduciary duty.

After you die, your successor acts just like an executor would—takes an inventory of your assets, pays your final bills, sells assets if necessary, has your final tax returns prepared, and distributes your assets according to the instructions in your trust.

Your successor trustee will be acting without court supervision, which is why your affairs can be handled privately and efficiently—and probably one of the reasons you have a living trust in the first place. But this also means it will be up to your successor to get things started and keep them moving along. It isn’t necessary for this person to know exactly what to do and when because your attorney, CPA, and other advisors can help guide him or her, but it is important that you name someone who is responsible and conscientious.

Successor trustees can be your adult children, other relatives, a trusted friend and or a corporate trustee (bank trust department or trust company). If you choose an individual, you should name more than one in case your first choice is unable to act. They should be people you know and trust, people whose judgment you respect and who will also respect your wishes.

When choosing a successor, keep in mind the type and amount of assets in your trust and the complexity of the provisions in your trust document. For example, if you plan to keep assets in your trust after you die for your beneficiaries, your successor would have more responsibilities for a longer period of time than if your assets will be distributed all at once.

Also, keep in mind the qualifications of your candidates. Consider personalities, financial or business experience, and time available due to their own family or career demands. Taking over as trustee for someone can take a substantial amount of time and requires a certain amount of business sense.

Be sure to ask the people you are considering if they would want this responsibility. Don’t put them on the spot and just assume they want to do this. Finally, trustees should be paid for this work; your trust document should provide for fair and reasonable compensation.

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