Copyright © 2019, The Law Office of Alain Roman, PLLC
At its more basic definition, estate planning is the process of setting up your affairs during your life, so that your selected beneficiaries inherit your property at death according to your wishes. A good estate planning attorney will also guide you with planning for incapacity, asset protection, reduction of taxes, and other issues that might affect your plans or goals.
Your estate is the value of your property, real or personal, tangible or intangible, wherever situated, at the time of your death. IRC & 2031. When an estate planning attorney talks about your estate, he or she means the property that you own, whether real property, personal property, securities, stock, etc.
The answer to this question varies with your estate and how complex your situation is. Most individuals need at a minimum a Last Will and Testament. This is because you need to have a document that outlines your wishes and who you would want to inherit and administer your estate in the event of your passing.
Other documents that are useful to have are the Durable Power of Attorney, Health Care Surrogate, and the Living Will. The purpose of these documents is to appoint an agent to make decisions on your behalf should you not be able to do so yourself. This is particularly important if you want to avoid Florida Guardianship Court.
Finally, depending on the type of assets that you own, a Florida Revocable Trust could be a good option. Specially, if those assets would be subject to Florida Probate Court.
Most estate planning attorneys will draft one if not all of the following documents:
The use of Irrevocable Trusts and more advanced estate planning documents will depend on your objectives and the size of your estate.
A Last Will and Testament is always recommended. This is because it allows you to put in writing your last wishes, appoint who you want to administer your estate, and if applicable, appoint who the guardian of your minor children should be.
In my experience, a Last Will and Testament is also important to avoid family conflict. When your wishes and instructions are not clear in writing, family member tend to argue on who should administer your estate, and what assets he or she should be entitled too.
The answer to this question depends on your type of assets. If Probate avoidance is desired, then the Revocable Trust is a good vehicle to achieve that end. However, not all property is subject to probate, only assets titled under your own individual name without a beneficiary designation are subject to Probate. Meaning that if you do not have any assets subject to Probate, then the Revocable Trust might not be completely necessary if the purpose is to avoid Florida Probate.
However, if the purpose is control, then a Revocable Living Trust would make total sense since you would be able to control what happens to your property after death. This would be done by electing your Revocable Living Trust as the beneficiary of your assets.
Regardless of whether you elect to have a Revocable Living Trust or not, the Last Will and Testament is always recommended. Whether as the principal estate planning tool, or as a backup to the Revocable Living Trust should any of your property end up in Florida Probate Court. In addition, the Last Will and Testament is particularly important if you have minor children.
In Florida, when you pass away without a Last Will and Testament, then the Florida Intestacy Statute dictates who are going to be your beneficiaries. The Intestacy Statute gives preference to any surviving spouse and to any children.
If you pass away without a Last Will and Testament in Florida, then the Florida Intestacy Statute will apply to your probate asset.
The Florida Intestacy Statute states that if you are married, and all your children are from the same marriage, then your spouse gets 100% of your probate assets.
If you have children from different marriages, then your spouse will get 50% and the rest of the children will divide the other 50%.
It is important to have a Last Will and Testament because you may not agree how the Florida Intestacy Statute disposes of your probate assets. In Florida, the only person legally entitled to inherit is your spouse. Your surviving spouse is entitled to 30% of your estate.
It is hard to put a price on estate planning. The reason being is that although the estate planning documents prepared by your estate planning attorney are important, most of the time what is most valuable is the experience and advice of the estate planning attorney.
A good estate planning attorney will go over the situations that are affecting your life, whether good or bad. Will analyze your objectives and desires and determine whether there could be any pitfalls along the way and how to prevent them or minimize them.
In addition, the estate planning attorney keeps you out of court. In almost every situation, the fees of the estate planning attorney will be significantly lower than the attorney’s fees required for a court proceeding.
I charge a flat fee for our estate planning services. This allows you to make an informed decision on the fees that you will incur in the matter and relieve some of the pressure that comes from hourly billing.
As of 2019 if your net worth is lower than 11.4 million then you won’t have to pay federal estate tax when you pass away. Some States have the same exemption as the federal estate tax exemption, but you should always check with your trusted estate planning attorney.
The estate tax exemption should sunset in 2025 and go back to the 5 million with inflation, subject to a new change in the law.