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Estate Planning and Administration

Palm Beach County Estate Planning Attorney to Handle Every Aspect of Your Florida Estate Plan 

Estate planning and estate administration are two equally important parts of an estate plan. With estate planning, you are making important decisions about how to protect your family now and in the future. Estate administration is all about how those estate planning wishes are carried out by others. As a Palm Beach County estate planning attorney at our firm will advise you, the administration of an estate tends to run substantially smoother when a properly executed plan was put in place. 

Estate Planning in Florida

It may be true that death is one of the certainties in life, but in Florida, a person can plan for:

  1. The distribution of his or her assets 
  2. Who will be responsible for settling his or her affairs and carrying out his or her intentions 
  3. Estate taxes payable upon death   

Planning with a Palm Beach County estate planning attorney can ease the burden on the survivors.  Moreover, planning also involves determining who will make decisions while a person is alive with respect to the person’s health care, if the person is unable to make health care decisions for himself or herself, and establishing a process to manage the person’s assets in the event of incapacity.

Documents Your Palm Beach County Estate Planning Attorney Will Prepare and Manage

The basic estate planning documents are as follows:

  • A Last Will and Testament is operative at death and directs the disposition of assets titled in the testator’s individual name.
  • A Revocable Trust is typically the residuary beneficiary of the will and directs the disposition of the trust grantor’s assets at death.  Unlike the will, this document will not be filed with the court on death.  By funding the revocable trust during life, the need for probate can be minimized and the grantor’s assets managed in the event of incapacity.
  • A Designation of Health Care Surrogate document designates a surrogate to make health care decisions for the signer (principal) if the principal is unable to make such decisions.
  • A Living Will sets forth the signer’s desires regarding life-prolonging procedures in the event the signer is suffering from a terminal illness or is in a vegetative state or has an end stage condition caused by injury, disease or illness.  Typically, this document requests that life-prolonging procedures be withheld or withdrawn when such procedures would only serve to prolong artificially the process of dying.  A living will can be customized to the signer’s wishes.
  • A Durable Power of Attorney appoints an agent to exercise financial powers for the signer (principal).  The principal may also authorize the agent to make decisions that can affect who benefits from the principal’s assets, for example, the power to make gifts or to change beneficiary designations.

Assets and Estate Planning in Florida

As part of this process, beneficiary designations for life insurance and retirement assets are also reviewed.  Strategies may also be discussed to reduce or minimize estate tax, which may involve the current transfer of assets.  While the minimization or elimination of estate tax is an important consideration, it is not the only consideration to be addressed.  The asset and estate planning process is an opportunity for a person to determine who he or she wants to benefit from his or her assets and how the beneficiaries should receive such assets.  

Often rather than leaving assets outright to a beneficiary, assets are left in trust to provide asset protection for the beneficiary, including protection from claims of former spouses; to ensure that the beneficiary does not receive assets until he or she has sufficient maturity to handle such assets; to ensure that assets stay in the family line; and/or take care of a beneficiary with special needs.   

Florida Estate Administration Made Easier with the Help of a Palm Beach County Estate Planning Attorney

Estate administration involves the settlement of a decedent’s affairs and the transmission of the decedent’s property.  The estate planning process is also an opportunity to determine who is best suited to carry out the estate plan.  A well thought out estate plan will make estate administration easier. 

Settling the Estate

If the decedent had a will, the assets will be transmitted in accordance with the terms of the decedent’s will (except to the extent that the surviving spouse or children may be granted rights under Florida law which differ from the terms of the will), and the person designated by the decedent to carry out the terms of the will, known as personal representative, will be appointed by the court, assuming that such person qualifies to serve as personal representative under Florida law.  (Oftentimes, the will provides that the assets are to be distributed to the decedent’s revocable trust to be distributed in accordance with the terms thereof.)  

If the decedent does not have a will, the decedent’s property will be distributed pursuant to rules set forth under Florida law, and the person appointed as personal representative will be chosen in accordance with the preferences set forth under Florida law. 

Thus, engaging in planning with the guidance of a Florida and Palm Beach County estate planning attorney can help ensure a smoother estate administration, the distribution of the decedent’s assets in accordance with the decedent’s wishes (rather than the rules set forth under Florida law) and the appointment of the person preferred by the decedent to serve as personal representative (and not necessarily the person granted preference by Florida law).

Estate administration involves the collection of the decedent’s assets and the payment of the decedent’s bills and the expenses of administering the decedent’s estate.  

Required Tax Returns

The personal representative is required to file a final income tax return for the decedent, which may be a joint income tax return if there is a surviving spouse.  The personal representative will also be required to file income tax returns for the decedent’s estate.  

Further, if the value of the decedent’s assets, including assets titled in joint names or in a revocable trust, together with the sum of taxable gifts made by the decedent during lifetime, is at least $11,580,000 in 2020, then a federal estate tax return will be required to be filed.  

Nonetheless, the fact that a federal estate tax return is required to be filed does not necessarily mean that estate tax will be owing.  In addition, while Florida does not impose an estate tax, if the decedent owned real or tangible personal property in other states, estate tax may be owing to such states.  Again, however, liability for federal and state estate tax may depend upon whether the decedent has engaged in estate planning. 

Distribution of Estate Assets

The final step of estate administration after the decedent’s affairs have been settled, the decedent’s bill and the costs of administering the decedent’s estate paid, and required tax returns have been filed, is the distribution of the decedent’s assets in accordance with the terms of the decedent’s will or, in the absence of a will, Florida law.

Our Palm Beach County Estate Planning Attorney Answers Your Top Questions

How soon should I meet with a lawyer after my loved one dies?

Ideally, you should meet with an estates and trust attorney within two weeks of your loved one’s passing, but definitely within a month. The sooner you seek legal counsel, the more likely the administration of the estate will go smoothly. 

How often should I meet with a Palm Beach County estate planning attorney?

You should visit your estate planning lawyers whenever you wish to change something substantive in your estate plan, you have a major life event like marriage, if there is a change in the tax laws, or your estate planning counsel asks you to come in. Otherwise, you should review your estate plan with your estate planning attorney at least once every five years to ensure that your plan is meeting your personal and professional objectives. 

If I am named as the personal representative of an estate, am I personally liable for claims of the decedent’s creditors?

People are often worried that they risk their own assets if they act as a personal representative. You will not be personally liable to creditors unless you received money from the estate preferentially, meaning that you were paid to the potential detriment of those creditors. Please note that preferential payments do not include fees and expenses incurred in administering the estate. 

How many death certificates should I obtain? Does the death certificate need to identify the cause of death?

The number of death certificates you need will depend on the number of financial accounts you need to close, insurance claims you need to make, and any other matters that will require you to prove the decedent’s death. To further complicate matters, some institutions, such as banks and investment firms, may require you to produce the original death certificate but keep a copy for their files. Pensions and life insurance companies often require that you submit an original to them.  As a result, the number of death certificates you need can vary widely, but obtaining enough to cover the financial accounts and insurance policies plus three to five extra is a good place to start. You should only obtain death certificates identifying “cause of death” in order to  claim life insurance benefits.

My will was drafted in another state. Will it be invalid under Florida law?

Florida law considers any will valid if it is valid under the laws of the state where it was executed, with the exception of wills that were hand-written by the deceased and oral wills. Even though your will is considered valid, Florida law could affect the way it is interpreted and administered. If you have an estate plan that was drafted out of state, you should have it reviewed by a licensed Palm Beach County estate planning attorney to ensure that it complies with Florida law and will accomplish your estate planning goals. 

How is an LLC taxed?

An LLC makes an election at the beginning of its existence to be taxed as either a C Corporation, an S Corporation, a disregarded entity or a partnership for federal tax purposes. If no election is made then the default choice is a Partnership.

Which assets are exempt from creditors in Florida?

Under Florida law, there are six assets that cannot be attached by creditors: 

  1. The homestead property - up to a half acre in a city or town and up to 160 acres in the country, and any “improvements” such as your home or other buildings
  2. Qualified retirement plans and IRAs
  3. Life insurance benefits
  4. Annuities
  5. Wages (with a number of caveats)
  6. Property owned as “tenants by the entirety” i.e. property owned by spouses.

What is the difference between property owned as Tenants by the Entirety and Tenants in Common?

Only spouses can own property as Tenants by the Entirety. Upon the death of one of the owners, the property passes to the surviving owner. In a Tenancy in Common, the deceased owner’s share generally passes as designated in the deed or according to the deceased owner’s  estate planning documents.

What is the amount of the Unified Credit against Gift and Estate Tax?

Upon death, estates are subject to taxation as it passes to your heirs. Previously, estates valued at $5 million or more were subject to the estate tax. However, the tax laws were recently amended and the unified tax credit was raised to estates worth $11.5 million or more. As a result, your estate may pass tax free if it is worth less than $11.5 million. 

How much can you give away each year without filing a gift tax return?

Under present law, there is a $15,000 gift tax exclusion per person per gift, which means that you can make several gifts to different persons or entities of $15,000 or less tax-free. For example, you can make a $15,000 gift to your son and another $15,000 gift to your daughter without paying a tax penalty. If you are married, your spouse also qualifies for the exclusion.  .

Speak with a Florida and Palm Beach County Estate Planning Attorney to Get Started

Questions about any part of the estate planning or administration process? Speak with a Comiter, Singer, Baseman & Braun Florida and Palm Beach County estate planning attorney, either online or by calling us at 561-626-2101 or toll-free at 800-226-1484. We work with estate planning and administration clients throughout the state of Florida. 

For More Information Or To Schedule A Consultation,Reach Out To Us Online Or Call Us At 561-626-2101

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