There are a myriad of estate planning tools that can help protect your real estate assets. Warm weather states like Florida are a mecca for second homes and investment properties. Unfortunately, these occasional homes become part of a person’s taxable estate when they die.    The Qualified Personal Residential Trust (QPRT) is a unique estate planning tool that provides a solution for this concern. A QPRT is an estate planning technique which is provided for under US Treasury Regulation Section 25.2702-5(c)(2). The regulation allows for the creation of a QPRT for a primary residence and a secondary residence.

The concept behind the QPRT is less confusing than its name implies.  Simply put, the QPRT operates as follows:

• An individual transfers the title of a property to the trust (QPRT).
• The individual sets up a pre-determined amount of time to continue living in the residence.
• The owner of the home (who is now called the grantor) pays the expenses associated with the residence such as homeowners’ association fees, taxes, and expenses; however he does not pay rent.
• When the pre-determined time is over, if the grantor is still alive, he may remain in the home and pay his children rent which should reflect an amount that would be paid in a similar situation.
• If the grantor dies, the home will pass to the children either without estate taxes or with significantly reduced estate taxes based upon the appreciated value of the home.

Due to the complex tax code we all endure, it is important to discuss this option with both a trust attorney and CPA. Specifically, there is a gift tax exemption ceiling which could affect the amount of estate tax that will ultimately have to be paid by the children. However, even if the house appreciates significantly, the children will benefit from a substantially lower estate tax than they would have paid if they inherited the property through traditional means like a will. This discount occurs because the taxable value of the house is lowered due to the grantor living in the house. Therefore, this unique tool should always be considered when considering your estate plan if you happen to own a second home.

For more information on successful Florida estate planning and probate techniques, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation.  It’s a Wild world.  Are you protected?

You may have heard the old expression that there are only two certainties in life: death and taxes.  Actually, that old addage is not entirely true.  By utilizing a combination of Revocable Trusts, Irrevocable Trusts and gifting, you may be able to eliminate your family’s estate tax burden altogether.  Foundational comprehensive estate planning will allow your family to avoid the worry connected with taxes and focus on the only true second certainty: reality shows about hoarders.

For more information on successful Florida estate planning and probate techniques, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation.  It’s a Wild world.  Are you protected?

Have you ever had to go through the probateprocess when a loved one died?  It’s horrible.  The court and attorney fees are very high, the assets are tied up for an incredible amount of time and the  entire process can lead to public embarrassment and fighting amongst family members.  In the song Wont Get Fooled Again, the Who must have been thinking about the probate process and how to avoid it.  Here’s a brief translation of one of the verses:

I’ll move myself and my family aside (the band is going to protect their families with estate planning)
If we happen to be left half alive (in addition to the trust, a power of attorney will protect from incapacity)
I’ll get all my papers and smile at the sky (the living trusts created by the band members)
Though I know that the hypnotized never lie  (so the fighting among family members will be avoided)
Do ya? (do you have your plan in place?)
 

A trust-based foundational estate plan can save your family hundreds of thousands of dollars in estate tax and probate fees and for the month of April, the law firm of Wild Felice & Pardo PA will draft your estate plan at a 25 percent discount if you mention this blog post.  I’d call that a Bargain … not the best I’ve ever had, but still pretty good.

For more information on successful Florida estate planning and probate techniques, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation.  It’s a Wild world.  Are you protected?

Today is the start of the baseball season and as the boys of summer get ready to take the diamond, we are reminded that it is springtime once again.  Spring is a time of rebirth and a great opportunity to adjust your estate plan to add those family members that have been born since you had it drafted.  If you don’t have an estate plan, now is a great time to have one constructed in order to protect those that you care about.  While the bats hit the balls, your pen should be hitting the paper as you should be signing you living trust and assuring that all of the people that you care about are protected long after you are gone. 

Play ball!  Call us for your free consultation.

For more information on successful Florida estate planning and probate techniques, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation.  It’s a Wild world.  Are you protected?

Wish you could go back in time to last Friday and pick VCU to upset Kansas?  How about going back a full month and picking UConn to win the whole thing?  Well, until Peabody is able to come over and set the Wayback Machine, we are not able to go back in time and correct our mistakes.  Losing in your March Madness Bracket Tournament is nothing in comparison to the mistakes I see every day in poorly drafted, poorly executed, and poorly funded estate plans.  

Top 10 Estate Planning Mistakes

1. Leaving the Living Trust Unfunded: A living trust is merely a vehicle that allows you to pass your assets outside of probate.  However, if there are no assets in the trust, nothing has been accomplished.  You can buy the most expensive safe at the store but it wont protect your valuables unless you put the valuables into the safe. 
2. Putting Your Children’s Names on Your Deed: These property will be subject to capital gains taxes when the beneficiary attempts to sell it.
3. Leaving Assets Outright to Beneficiaries: Assets that are left outright to heirs and beneficiaries are exposed to creditors, predators and divorcing spouses. 
4. Not Having a Living Will:  A living will gives guidelines for your physician to follow in the event you are in a terminal, end-stage, and persistent vegetative state. 
5. Owning Life Insurance in Your Name: Many people are not aware that the death benefit of an insurance policy, owned by the insured is included in their taxable estate. 
6. Not Communicating with Trustees and Beneficiaries:  It is important to let the people who are named in your estate plan know what role you are asking them to play. 
7. Not Knowing Where All the Assets Are: A scattered estate plan by a secretive decedent may cause some assets to be left uncollected, undistributed and even lost.
8. Not Updating Your Estate Plan:  It is imperative that your estate plan is reviewed on an annual basis to avoid unintended results. 
9. Drafting Your Own Estate Plan:  There are so many moving parts with a trust-based estate plan that attempting to do it yourself is the equivalent of trying to take your own appendix out.  There are legal requirements in drafting, executing, funding, and updating.  If you miss any of them, it could invalidate your entire plan.  An estate planning attorney doesn’t sell you documents, they provide the service that goes into making sure that those documents are correct.
10. Thinking That You Have Plenty Of Time To Get To It:  No one has a crystal ball and tomorrow is not promised to any of us.  I have clients that have hired me to draft their estate plan and then they died prior to being able to sign it or fund it.  There are other people who die too young to even sit with the attorney.  Estate planning is necessary for everyone and you should sit with your attorney as soon in life as possible.

Failing to visit your estate planning attorney to get a comprehensive estate plan in place could lead to your family’s financial bracket being completely busted.  For more information on successful Florida estate planning and probate techniques, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation. It’s a Wild world. Are you protected?