David Howard Goldberg, P.L.

Miami Estate Planning Blog

Seeking guardianship is often painful, but important

Watching a loved one's health decline is difficult. The unfortunate truth is that most people reach a stage where they are unable to care for themselves without having planned for this possibility. Without an advance health care directive or power of attorney in place, family members may be unable to make important medical, financial and legal decisions for their loved one without the intervention of the Florida courts.

In such cases, many families make the difficult but critical decision to petition the court for guardianship over loved ones who are no longer able to handle their own affairs. This may be due to a medical condition such as a stroke or dementia, or it could be because of injuries from an accident. Guardians handle the legal, financial and medical decisions -- depending on the level of authority granted by the court -- for the incapacitated loved one and seek approval of the court for any major decisions.

Childless adults still need to plan for their future

Florida readers know estate planning is an important process, but there are many who choose to forgo this step altogether. There is a misconception that estate planning is only important for those who have kids or significant wealth, but that is not necessarily true. In fact, childless adults will still find it important to think about their future and put certain protections in place. 

Estate planning involves more than just outlining how the distribution of assets will work for beneficiaries. If you do not have kids, you may think that having a will and other estate planning protections in place is not necessary. In addition to deciding what you want to happen to your estate assets, you can also plan for your own health care and other things that could impact your future.

The appropriate way to handle trusts in a Florida family

Every Florida family has different estate planning needs and goals. In some situations, leaving assets through a will is sufficient, but there are other tools available that can help a person achieve his or her goals for beneficiaries and heirs long after passing. One way to do this is through trusts. This specific option allows a person to set aside and protect assets for a specific use.

Many people use trusts as a way to set aside money and assets for beneficiaries, such as grandchildren. It is not always easy to know when to inform beneficiaries of this step and how involved they should be in this process. The people who will benefit from a trust may have to wait years, such as when he or she reaches a certain age, to have access to the assets. 

Families use trusts for heirs with addictions

Few families in Florida or elsewhere in the country are untouched by the opioid epidemic. Drug overdose is now the number one cause of death for those younger than 50 in the United States. Drug addiction has no demographic, and families of all backgrounds are watching loved ones struggle with the powerful hold of heroin, prescription drugs and other substances. Because of this added complication when it comes to estate planning, many include trusts among their documents.

Parents are often caught in a difficult position when a child is an addict. They may have already spent thousands of dollars trying to help the child achieve sobriety or lost assets if the child resorted to theft to support his or her habit. Siblings of the addicted child may harbor resentment, and parents may consider disinheriting a child who may use any inheritance to continue feeding a drug habit. The risk of this decision is that it may place the estate in jeopardy if the disinherited child challenges the will.

Wills from other states may be invalid in Florida

Many people across the country find a home in Florida in their later years. The warm climate and friendly tax laws make this state a haven for retirees. However, moving from another state may mean adapting to many changes, including any estate planning decisions someone may have made prior to relocating. Each state has different rules for what makes wills and trusts valid, and those who move to a new state should be sure to learn if those laws require adjustments to their estate plans.

When someone in another state creates a will that complies with the laws of that state, Florida will likely see that will as valid even if the previous state's rules differ. However, Florida does not recognize some kinds of wills that other states accept. For example, someone who moves to Florida with a holographic, or handwritten will, should seek advice from an estate planning attorney because Florida law does not honor holographic wills.

You may be committing estate planning mistakes and not know it

You may think you have all the protection you need because you have a will or you have the necessary estate planning documents in place. While it is prudent to have an estate plan, even if you are not wealthy or have a large estate, that may not be all you should do. It is beneficial for everyone who has a plan to carefully review all aspects of it to ensure there are no mistakes or issues that could cause problems later. 

Mistakes in an estate plan, even small ones, can cause significant complications for you or your beneficiaries down the road. It is in your interests to carefully review everything and rectify any problems that you may discover. It is especially prudent to review your plan if you have experienced significant life changes recently or it has been a few years since you have looked over everything.

What can complicate trust administration?

One of the benefits of a revocable living trust is that it allows the assets funded within it to bypass probate according to the instructions left within the trust. Whereas probated assets may linger in the process for up to a year, trust administration may be settled within a month or two, barring any complications. Some of the factors that may complicate a Florida will going through probate may also complicate a trust after the death of the trustor.

Because of the necessity of having original documents with original signatures, the distance between the estate, its beneficiaries and the successor trustee may bring delays, but not anything that would cause concern. What may indicate trouble is if the beneficiaries disagree on the administration of the trust or decide to contest its validity. Challenging a trust requires similar arguments to those for challenging a will, but it is more difficult to challenge a trust.

Clearing up power of attorney misconceptions

A power of attorney can be an important and powerful document. When people sign these documents, they are giving someone else control over their legal and financial decisions. This may seem like a risk, and that is why many in Florida hesitate to include a power of attorney in their estate plans. However, it is also an essential protection in case they become incapacitated and unable to manage their finances on their own.

Unfortunately, few people truly understand how a POA works. For example, many adult children believe they can ask an attorney to give them power of attorney when their parents are already suffering from dementia. This is impossible since any legal document requires the principal, that is the person executing it, to be mentally competent. This is why it is best to create an estate plan with a POA as early as possible.

Steps of estate administration and probate

When someone dies, the estate of the deceased may go through the probate process to legally transfer the property to the heirs, pay any lingering debts and close the affairs of the deceased. While this sounds simple, the probate process can be complex, especially if issues or conflicts arise among the heirs. Barring these complications, however, estate administration generally follows a logical pattern.

As soon as possible after the loved one's death, family members should locate the will, if one exists. Even without a will, the steps of probate will be the same, starting with opening the estate in Florida probate court. At this time, the court will approve the executor named in the will or appoint an administrator who will handle the remaining steps of probate.

Assets not funded to trusts lead to complications for heirs

Establishing a revocable living trust is a wise move for many in Florida who are planning their estates. Revocable trusts protect assets from taxes and probate and allow heirs to benefit from the assets according to the trustee's directives. However, establishing a trust is only the first step. Assets are not covered by the terms of the trust if the trustee does not fund them to the trust.

It is not unusual for someone to gain and lose assets as time passes. A trustee may purchase a new home, sell a business or trade valuable art or jewelry. Failing to title any new property to the trust after these changes may leave the assets open to probate. This may make things especially complicated for heirs. If, for example, the trustee purchases additional real estate in another state without funding the property to the trust, the heirs will not only have to deal with a prolonged probate, but likely an ancillary probate for the out-of-state property.

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