AS WE MOVE CLOSER TO AUGUST, it’s time to mark your calendars for your “back to school sales tax holidays” – which are now expanding to cover just about everything in some states. In previous years, this sales tax holiday provided a couple days for shoppers to ravish the malls and department stores for clothing and school supplies. In states like Louisiana, you can purchase anything up to the price of $2,500 without tax being imposed, including guns! However, here in South Florida, your tax breaks will cover the standard clothing and school supplies, as well as computers and tablets (priced up to $750).

Florida state Rep. Larry Ahern, stated “[w]e are trying to take some of the burden off Florida families as they prepare for their children going back to school in August.” Speaking of burden’s – if you are participating in back-to-school tax savings, your child’s college years are probably just around the corner! While you can shop ‘til you drop every year, there are other tax planning techniques that can be used to save for your child’s college expenses, while avoiding those pesky mall folk!

The 529 Plan – a 529 plan allows you (or really, anyone) to contribute to an account to save for your child’s college education, and it is not subject to federal taxation. There is no age limit for when the plan can be used, and it can roll over to another family member. You can maintain control beyond your own natural years by appointing a guardian/trustee to manage it upon death. Not only do you avoid tax on withdrawals, but any capital gains are tax-free as well. Also, as an alternative, the Florida college savings plan is the largest prepaid plan in the nation.

No Generation Skipping Tax for College Payments – Lets say that you want to assist your grandchild in broadening their minds and finding a career path. You can create a trust, and give the trustee (you can be the trustee) a power to distribute the money for your grandchild’s tuition. This means, your trustee power is limited by an ascertainable standard, and may not be included in your gross estate (aka, you are not taxed on the amount).

So while stretching your legs for the mall-marathon that will be taking place  in South Florida on August 2-4, take a moment to consider the significant tax-free benefits of planning ahead for your child’s college education!

For more information on successful Florida estate planning and asset protection techniques, please contact the South Florida law firm of Wild Felice & Partners, P.A. at 954-944-2855 to schedule your free consultation.

It’s a Wild world. Are you protected?SM

When he was the lead mafia boss in the Soprano’s, the IRS would not be a threat to James Gandolfini; as he’d simply bribe a Federal agent, or have “his people take care of it.” But here in the Wild world of reality, only attentive estate planning keeps the IRS monsters at bay. And in this case, the only “hit” that’s taking place, is that against Gandolfini’s estate.

Gandolfini died with an estate that is currently estimated to be $70 million. While he has been a very successful man, his use of poor estate planning has resulted in a lot of grief for both his legacy & loved ones. Although he devised his property through a will to the beneficiaries of his choosing, the IRS has claimed the biggest share, weighing in at about $30 million. Furthermore, his entire will is now a public record that anyone can view, because it was subject to probate (where the court determines the validity of a will).

This estate planning (or lack thereof) catastrophe demonstrates two very critical points in strategic estate planning: (1) avoiding taxes, & (2) creating a private and smooth distribution of property. 

In terms of tax, married couples have an incredible safeguard, called the martial deduction. One of Gandolfini’s biggest mistakes was devising only 20% of his estate to his wife. Due to the unlimited marital deduction, anything you transfer to your spouse is not subject to transfer taxes, and therefore that money goes free & clear of estate taxes upon the death of the transferor (Gandolfini). When you have such a large estate, it is often advisable to include the amount in your gross estate that covers the full applicable exclusion amount (the transfer tax exemption that each individual receives upon death), which is currently at $5,250,000. Then you can transfer the rest to your spouse, and it goes transfer tax free for the time being.

So why did he fail to take advantage of a tax-free transfer? This often happens in cases where there is a child that is from a previous marriage, or a similar complicated family situation. Gandolfini has a son from a previous marriage, and therefore possibly did not want to devise all his assets to his wife, in efforts to ensure his son would be provided for. While this is a valid concern, there are estate planning strategies that can be implemented to obtain these goals, while still safeguarding your assets from excessive taxes. A marital trust is often used in theses situations. The instrument provides that the income from the trust property will be paid to the spouse for life, and then upon the spouse’s death, to the children. This could have dramatically shrunk the IRS bill that will come due in only 9 months.

On the second point, whenever you devise all of your property directly through a will, it will go through probate before the property is distributed to the beneficiaries. The problem with this is that the will becomes public record, and it’s contents are exposed for the whole world to see. This is why it is desirable to use a “pour-over will” that filters all of your assets into a trust. By doing so, you avoid the costs and grief associated with probate, and preserve privacy for yourself, and loved ones.

For more information on successful Florida estate planning and asset protection techniques, please contact the South Florida law firm of Wild Felice & Partners, P.A. at 954-944-2855 to schedule your free consultation.

It’s a Wild world. Are you protected?SM

Within the past several days there have been two horrific plane crashes, leading to a total of 12 deaths. On Saturday, an Asiana Airlines flight crashed while landing in San Francisco, with 307 passengers on board. Two have been reported dead, with many in critical condition. The next day an Alaskan air taxi crashed, killing all 9 passengers, as well as the pilot.

With devastating events such as these, we are confronted with the grave reminder of how fleeting life can be, and the importance of planning for the unknown. For many, such planning is for the benefit of family; while others want to keep their memories alive through good deeds & charity donations. Although we have little control over our fate; you can gain control over your legacy with the following estate planning documents:

Living Trust – gain control, asset protection, & preclusion of unnecessary taxes; ensuring asset protection for your beneficiaries.

• gifts to charities that qualify for income tax and estate tax deductions can be made through Charitable Lead Annuity Trusts or Charitable Remainder Trusts.  Furthermore, a Charitable Lead Annuity Trusts (“CLATS”) allow an individual to transfer their assets to a beneficiary upon their death who can then donate the assets to a charity of their choosing.

Assignment of Property – place all of your property into the trust, and avoid costs & headache associated with probate.

Last Will & Testament – used to distribute property to beneficiaries (or a trust), specify last wishes, and name guardians for minor children.

Durable Power of Attorney – gain control by designating someone to legally act on your behalf, in the event that you become incapacitated.

Combination Living Will & Designation of Healthcare Surrogate – gain control by making important healthcare decisions for yourself in advance.

For more information on successful Florida estate planning and asset protection techniques, please contact the South Florida law firm of Wild Felice & Partners, P.A. at 954-944-2855 to schedule your free consultation.

It’s a Wild world. Are you protected?SM

IN THE SPIRIT OF AMERICAN INDEPENDENCE, our nation is encouraged by the latest job market rise. The labor department’s reports have shown that the economy has added 195,000 jobs in both May & June, when analyst were projecting only 160,000.

The thirteen colonies didn’t gain independence for four hundred forty-two days after start of American Revolution. Similarly, it’s taken a good minute to find that same sense of freedom from the depressed job market in South Florida.

The Red, White & Blue’s will to overcome the job market adversity is demonstrative of the motivating force we celebrate this week. With raising job rates, its increasingly more important to keep your triumphant spirit preserved with asset protection strategies. Such strategies will not only protect your hard earned assets, but provide you with the freedom to control their disposition.

When considering your future, claim independence from the unknown, and plan ahead with the following documents:

1. Living Trust – gain control, asset protection, & preclusion of unnecessary taxes through the use of this document.

• Consider: Who would you appoint as your Trustee? Keep in mind, you can be the Trustee, giving yourself greater control over your assets. Make sure you appoint a back-up (successor) Trustee(s) within the document.

2. Assignment of Property – place all of your property into the trust, and avoid costs & headache associated with probate.

• Note: Probate is a very expensive and time consuming process, therefore most prefer to avoid it altogether by assigning all of their property to the trust.

3. Last Will & Testament – used to distribute property to beneficiaries (or a trust), specify last wishes, and name guardians for minor children.

• Note: Again, in efforts to avoid probate, it may be wise to use a pour-over will so that anything that was not assigned to the trust will be directed to the trust upon the Testator’s death. While the will still has to go through probate, the pour-over will makes the process much more expedient & leaves less room for anyone to contest it’s validity.

4. Durable Power of Attorney (“DPA”) – gain control by designating someone to legally act on your behalf in the event that you become incapacitated.

• Consider: Who will you designate to make decisions on your behalf? Remember, the DPA can only make decisions for your benefit, not their own.

5. Combination Living Will & Designation of Healthcare Surrogate – gain control by making important healthcare decisions in advance.

• Note: This outlines important healthcare decisions in advance, and appoints a healthcare surrogate to make healthcare decisions for you when you become unable to do so yourself.

For more information on successful Florida estate planning and asset protection techniques, please contact the South Florida law firm of Wild Felice & Partners, P.A. at 954-944-2855 to schedule your free consultation.

It’s a Wild world. Are you protected?SM

The past week has lent itself to several CELEBRITY BABY BIRTHS, from Kim K. to Jessica Simpson; not to mention Kate Middleton, who is due any day now. Although we have had plenty of incoming news on baby-bumps and loss of judgment with regard to names (ex: “North West?”), there is an aspect of being a baby-momma that the news hasn’t quite touched on – planning ahead! We aren’t talking about a never ending supply of onesies with clever sayings, or baby-proofing your home. Rather, we are talking about ensuring that little Junior is provided for, in the event that you no longer can. We know, it’s a daunting subject when bringing life into the world – but nevertheless, very important.

When considering an appropriate name for your little newby (preferable one that won’t haunt little Jr. for the rest of his/her life), take a moment to  consider the following:

1. Estate plan – you want to have control over where your assets go upon your death. The moment you have a child, you want to be certain that you have an estate plan in place to ensure that he/she is provided for. In South Florida, if you do not have a will, the State of Florida will determine how your assets are distributed. Furthermore, you may want to put your assets into a living trust to avoid the costs and time associated with probate. This way, you can still use a pour-over will to distribute items into the trust, and have control over what beneficiaries will receive your assets, & how much they will be entitled to.
2. Pick a Guardian – In the event that anything happens to you, you want to ensure that someone you trust has guardianship over your child. You can always change the guardianship later on in life, especially if you want to make your own parents designated guardians for the time being. Keep in mind, the guardian does not necessarily have to take care of the child’s financial affairs, as you can designate someone else separately.
3. Life Insurance – if you haven’t applied for life insurance prior to being pregnant, you want to do so as early in pregnancy as possible, due to potential issues that can effect the insurance agency’s decision. However, keep in mind, some agencies may post-pone their decision until the third trimester to ensure there are no pregnancy-related issues. Also, there are many benefits associated with putting your life insurance into a trust. Younger families with modest assets will likely want to use a revocable trust, while larger estates may consider an irrevocable trust to exclude Life insurance proceeds from the gross estate (for purposes of estate taxes).
4. College planning – as soon as you get Junior’s social security number, it’s time to open a 529 college savings plan. This cannot be done soon enough, as the tax savings are substantial. You not only don’t have to pay tax on withdrawals, but any capital gains are tax-free as well. Einstein said that “the hardest thing in the world to understand is the income tax,” & that is what makes this plan so simple = no federal income tax on money in the 529 college savings plan (plus, no income tax in Florida). Also, as an alternative, the Florida college savings plan is the largest prepaid plan in the nation.

For more information on successful Florida estate planning and asset protection, contact the South Florida law firm of Wild Felice & Partners, P.A. at 954-944-2855 or via email at mwild@wfplaw.com to schedule your free consultation.

It’s a Wild world. Are you protected?SM