Learn more about Wills, Trust and the Probate Process. You need to take care of Yourself and your Loved Ones. Click on the “Estate Planning 10” to watch it on YouTube Estate Planning 101.
August is National Make-A-Will Month
It’s that time of year again. August is National Make-A-Will Month, and it is not too late to jump on the wagon. Why do you need a Will you may ask? The reason is simple. With a Will, you decide who gets the assets you own at your death. Without a Will, Florida law determines who gets your assets.
At times, that may be okay; Florida law may direct that your assets go to the same people that you would have wanted the assets to go to if you had made a Will. However, that is not always the case.
For example, what if you haven’t spoken to one of your children in 20 years, while another of your children has spent the last 5 years taking care of you? Under Florida law, if you don’t have a Will (and in this case, we are assuming you have no spouse either), the court will direct that your assets be distributed equally among your children. That means that the child that you haven’t spoken to in 20 years will get just as much as the child who has spent the last 5 years taking care of you. Is that what you want to happen? If not, you need a Will.
As a side note, a Will does not avoid probate. Your beneficiaries will still have to go through the probate process to get your assets transferred, but your assets will go to the person that you wanted to have those assets. There are many ways to avoid probate that a good estate planning attorney can help you with.
If someone you know could benefit from getting a Will and the other needed estate planning documents, please share this article with them. If you are ready to get a Will and the other estate planning documents that everyone needs, talk to your favorite estate planning attorney who will advise you on the best way to prepare you and your loved ones for the future.
Lorien Smith Johnson
Estate Planning and Probate Attorney
Lorien S. Johnson, PLLC
1520 W. Cleveland Street
Tampa, FL 33606
813-758-3492
Disclaimer: This article contains general information directed to Florida residents. This firm does not intend to give legal advice through this article. If you need legal advice, we encourage you to find an estate planning attorney licensed in your state. Additionally, this article does not create an attorney-client relationship between you and this firm.
It is imperative that parents with minor children have estate plans. At a bare minimum,
parents need to name healthcare surrogates to make medical decisions for their children until the
parents can get to the hospital, and parents also need to name guardians for their children if the
parents are both gone. Parents should also consider including a Revocable Trust as part of their
estate plan.
So what is it about having children that makes a Revocable Trust a good solution if
parents die earlier than they would like?
The first reason is that without a Revocable Trust, the child generally has full access to
all of the inherited funds at age 18. How many 18-year-olds do you know that would spend a
lump sum inheritance wisely? With a Revocable Trust, parents can protect the child against
extravagant spending sprees that often occur if a child inherits funds at a young age. With a
Revocable Trust, parents can provide financially for their child while placing limitations on lump
sum distributions. These limitations could include the child reaching a certain age(s) or reaching
a certain milestone(s) that the parents believe indicate the child’s readiness to make responsible
decisions.
Additionally, if parents do not have a properly funded Revocable Trust, a probate will be
needed to transfer the parents’ assets to the child. If a minor receives an inheritance of more than
$15,000 through probate, Florida law requires that a court appoint a financial guardian to look
after the assets for the child. The financial guardian is in place until the child is 18 and must file
detailed reports with the court every year – a time-consuming, and sometimes costly, burden.
And again, the child receives the remainder of the assets upon turning 18.
While a Revocable Trust does not protect the assets of the person who creates it from that
person’s creditors, when done correctly, a Revocable Trust can protect the assets held in that
trust from some of the child’s creditors and a child’s angry spouse.
Finally, a Revocable Trust can also be set up to limit the distribution of funds in the
unfortunate case of a child having a substance abuse problem.
For all of these reasons, parents should think carefully about using a Revocable Trust to
protect their child after the parents are gone. Even if parents do not choose to set up a Revocable
Trust, they should at least have papers designating a healthcare surrogate and guardian for their
child.
If you know someone who could benefit from a Revocable Trust and other estate
planning documents, please share this article with them.
Lorien Smith Johnson, Esq.
Estate Planning and Probate Attorney
LSJohnson@LorienSJohnson.com
What is a Lady Bird Deed? Basically, a Lady Bird Deed is like a beneficiary designation on real property. As generally written, a Lady Bird Deed (also called an enhanced life estate deed) transfers a piece of property immediately after the death of the owner.
Perhaps the biggest advantage of a Lady Bird Deed is that it allows your property to transfer to your beneficiaries without going through probate. Probate is an added expense and another headache for your family members when they are already dealing with your loss.
Unlike some other ways to avoid the probate process to transfer your property, with a Lady Bird Deed, you still own the property. You keep the right to do anything you want with your property. You can still sell it, mortgage it, or change the beneficiary designation. Additionally, like property inherited through the probate process, the beneficiaries get a step-up in basis when the property passes to them at your death.
Lady Bird Deeds have some disadvantages which should be discussed with your estate planning attorney before you go with this approach.
If you want to determine if a Lady Bird Deed is a good vehicle to include in your estate plan, talk to your favorite estate planning attorney who will advise you on whether a Lady Bird Deed would work in your situation.
Disclaimer:This article contains general information directed to Florida residents.This firm does not intend to give legal advice through this article.If you need legal advice, we encourage you to find an estate planning attorney licensed in your state.Additionally, this article does not create an attorney-client relationship between you and this firm.
I often get questions about the need for an attorney when there are free online templates for wills and other estate planning documents. Of course, it is cheaper to use these templates, but what are you giving up, and what problems might you be causing for your family?
Using one of these online forms may not be the best approach for you. Lawyers are trained to ask questions to identify the documents needed to meet your goals. For example, not everyone needs a trust in addition to a will, but if you have children, that may be the best way to go. Do you really want your children inheriting everything when they turn 18 and may not handle money very well? “Cool, now I can afford that nice car that mom and dad wouldn’t let me buy.”
Also, it is easy for individuals to make mistakes on the documents from the web. I have seen two cases in which the wills may not be valid because the person made a mistake in completing them. If the court rules that these wills are not valid, a whole different group will be receiving the deceased person’s assets. Don’t you want to make sure that your assets are given to the people you want to get them? If a will isn’t valid, the good state of Florida says who gets your assets, and that may not be what you wanted to happen.
The money you spend on a lawyer will likely save your family time and money when the time comes that these documents are needed.
The Bottom Line:
If you want an estate plan that is going to work for your family when it is needed, consult a lawyer with the education, knowledge, and experience to counsel you and draft the documents that suit your needs. Your family is worth it, don’t you agree?
Imagine that you are in the hospital, unconscious. Who’s going to tell the doctors what you want done? Do you want to be the one who decides that person, or do you want the state to say who can make decisions for you?
The decision-maker may be obvious if you are married, but what if your spouse is unconscious as well? And what if you are single? Who decides then?
Everyone needs a health care surrogate, especially in times like these. A health care surrogate document, also called a health care power of attorney, designates the person that you want to make medical decisions for you when you can’t. This document is important for everyone to have, even more so than ever in these crazy times.
A health care surrogate document is not the same as a living will. A health care surrogate document identifies a specific person to make medical decisions for you when those decisions will keep you alive in a meaningful way. A living will tells your doctors what you want to happen if the doctors have decided that nothing more can be done for you.
Everyone needs both of these documents. And what a great time to get your will in place, too. Contact your favorite estate planning attorney who can prepare all these documents for you quickly.
Best regards and stay safe.
Disclaimer: This website contains general information directed to Florida residents. This firm does not intend to give legal advice through its pages and/or blog. If you need legal advice, we encourage you to find an attorney licensed in your state. This language on this website does not create an attorney-client relationship between you and this firm.
What do you mean I can't access that...
Normally, one thinks of healthcare and financial powers of attorney is something “older people” need. However, as a 2014 Forbes article states, children turning 18 also need to sign these two documents before they leave home – or even if they stay home.
What most parents don’t know is that once a child turns 18, the parents have no access to the medical and financial records of that child – now officially an adult – even if parents are paying for their new adult’s healthcare insurance and/or funding those bank accounts.
This lack of access can be a nightmare in a healthcare emergency when parents don’t have access to all of the new adult’s medical records to help direct the doctors. While financial concerns are not usually as time sensitive, there may be times when the new adult would want someone else to act on their behalf such as renewing a car registration, signing a lease in their absence, or accessing a bank account.
In addition to these documents, the new adult also needs a living will to guide doctors regarding end of life decisions. And while they are at it, if the new adult wants to leave any assets owned now – or assets that may be acquired prior to getting around to changing their will – to someone other than their parents, a will is needed as well. Without a will in place, any assets pass according to state intestacy laws – first to children, if none, then to parents, etc.
If you or someone you know could benefit from these documents, please feel free to share this article or give them my information.
Disclaimer: This website contains general information directed to Florida residents. This firm does not intend to give legal advice through its pages and/or blog. If you need legal advice, we encourage you to find an attorney licensed in your state. This language on this website does not create an attorney-client relationship between you and this firm.
Lorien Smith Johnson
813-758-3492
Where there’s a will – or power of attorney –
There’s peace of mind.
While a trust is an often touted part of estate planning, not everyone needs a trust. So who does need a Trust? Today we will look at one category of people who need a trust – people with children, especially minor children. So what about having children makes a trust the best solution to estate planning needs? There are actually several reasons.
The first is protection against extravagant spending sprees if the child inherits the funds at a young age. Without a trust, the child generally has full access to the inherited funds at age 18. How many 18 year olds can be expected to spend funds wisely?
Additionally, if a minor receives an inheritance of more than $15,000, Florida law requires a court-appointed guardian to look after the assets for the child. The guardian is in place until the child is 18 and must file reports with the court every year – a time-consuming burden which can deplete the child’s assets depending on who is appointed guardian. And again, the child receives the remainder of the assets upon turning 18.
Which leads to a reason a trust is important when you have children of any age. While a basic trust does not protect your assets from your creditors, when done correctly, a trust can protect your child’s trust assets from your child’s creditors, angry spouses, or plaintiffs in a law suit. This protection comes from the use of the simple word “may.” Worded correctly, the trust says the child may take a certain amount after reaching a certain point – generally an age set by the parent. The “may take” language allows the child to choose not to take the distribution of the assets. If the child does not take the assets, then the assets legally do not belong to the child. Therefore, these assets are protected if the child is involved in bankruptcy, an ugly divorce, or a law suit. The bankruptcy trustee, soon-to-be ex-spouse, or plaintiff cannot get at those assets because the assets do not belong to your child until the child chooses to take the assets out of the trust.
Finally, a trust can also be set up to limit or withhold funds in the unfortunate case of the child having a substance abuse problem.
For all of these reasons, parents should think carefully about using a trust to protect their children after they are gone.
If you have any questions on this article or other aspects of estate planning, please feel free to contact your favorite estate planning attorney or give me a call at 813-758-3492 or e-mail me at LSJohnson@LorienSJohnson.com.
Disclaimer: This website contains general information directed to Florida residents. This firm does not intend to give legal advice through its pages and/or blog. If you need legal advice, we encourage you to find an attorney licensed in your state. This language on this website does not create an attorney-client relationship between you and this firm.