As if the bar exam isn’t stressful enough for test takers, hopeful future lawyers across the country found themselves unable to upload their first day exams after the ExamSoft servers were apparently unable to handle the massive traffic. While the issue appears to be on its way to resolution, test takers were still subjected to a tremendous amount of stress before the second part of the test. ExamSoft had years to prepare for this level of traffic and yet the system was not ready and many students suffered unnecessary stress. This situation mirrors what your loved ones will go through if you do not have a proper estate plan in place at your death, especially if your estate has to go through probate.

Probate is the mandatory process in Florida of validating a will (if there is one) and distributing the assets to the beneficiaries. This process usually lasts at least six months and can take substantially longer depending on the size of the estate or complexity of the assets. While the probate is going on, the estate assets are frozen while they are marshaled and prepared for distribution. Creditors are also paid off out of the estate before distribution. During this time, the presumed beneficiaries do not have access to the estate property. This can lead to financial hardship and liquidity issues for the surviving family members. Furthermore, probating an estate is costly, which continues to decrease the inheritance the beneficiaries will receive.

Whether you die with a will or not, you will still have to probate your estate if your probatable estate exceeds $75,000 (Florida’s probate limit.) A will alone is not a sufficient device for avoiding probate. The benefit of having a will is that you can decide who gets what from your estate, and you can also name a guardian, but a will does not avoid probate. To effectively avoid probate, a trust based estate plan should be used. A trust based plan avoids probate by transferring ownership from you as an individual to your living trust. You will be able to use all your assets in the exact same way, but when you die, your estate will pass to your beneficiaries without going through probate. In addition to the benefit of avoiding probate, a trust based plan also gives you as grantor increased control over who gets the assets down the road and creditor protection for your beneficiaries.

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

This weekend, fourteen Venice Beach patrons were injured, with one fatality, when lightning struck near the pier. This was a rare occurrence and was not something the beachgoers were prepared for. Lightning strikes can be a lot like a probate hitting your family. Not only will they be dealing with the passing of a loved, they will have to deal with the long and complex process of probate.

In Florida, probate is the mandatory process of validating a will and distributing estate assets to the beneficiaries. During this time, accounts are frozen while the personal representative marshals the assets and prepares to distribute. Probate usually lasts at least six months and can last considerably longer depending on the size an complexity of the estate. Probate can lead to periods of illiquidity for beneficiaries as they wait for accounts to be unfrozen and distributions to be made, putting in dire financial situations.

The best way to avoid the hassles of probate is to use a trust based estate plan. With a trust based estate plan, a living trust is formed in your name and is funded using an assignment of property. Essentially, all of your property becomes property of the trust. While this might sound scary at first, it really isn’t. Because you are the grantor, trustee, and beneficiary of the living trust, you retain complete control over all your property and can do with it everything you could as an individual.

In addition to passing your property outside of probate, trusts provide creditor protection for your beneficiaries and give you as grantor an increased level of control from beyond the grave. Once you pass, your living trust will create individual irrevocable trusts for all of your beneficiaries. As grantor, you can name the trustee of each of these trusts and the contingent beneficiaries. If you have a child who is not fiscally responsible, you can name a trustee other than them who will manage the trust for the benefit of your child while making sure that your child doesn’t waste the money. If you have a child who is married to a spouse you don’t trust, you can make sure that the trust money passes to your grandchildren and not the spouse. Because the inheritance will be held in a trust, creditors will not be able to reach the money either.

Under a trust plan, a will is still used, but it is used as a funding document, rather than a distribution document. This type of will is referred to as a “pour-over will.” Pour-over wills act as a safety net, or a funnel, and makes sure that any property that you forgot to put in the trust (if you had just moved homes and not retitled for example) ends up in your trust. This property would still have to be probated, but only this property would have to be; all the property in your trust would pass outside probate as originally intended. After the probate, the pour-over will gives the property to the trust and it will receive all the benefits of all your other trust property.

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

With most major TV shows off the air until the fall, viewers have been forced to find escape with other programs. Whether you’ve watched with a significant other or its your guilty pleasure, all of us have seen some incarnation of The Real Housewives. Aside from being an opportunity to watch older women get drunk and yell at each other and occasionally throw a prosthetic limb across the table (as happened on this week’s New York finale), these Bravo soap operas demonstrate various situations in which estate planning & asset protection are needed, because sometimes, life resembles a soap opera more than we’d like to admit. Although only one of the many Housewives series occurs in Florida, all the situations will be discussed through the lens of the relevant Florida law because that is what concerns you.

While estate planning is often about who gets what after you are gone, it is also about protecting your assets for your beneficiaries and for yourself during life. Take Real Housewife of New York Sonja for example. Due to a series of events not worth enumerating here, Sonja has found herself in bankruptcy, with a trustee now in control of her assets, including her home. While Sonja would likely have homestead protection in Florida, there are other steps she would be able to take to protect some her assets as well. Retirement plans, such as IRAs and 401Ks are creditor protected, as well as assets owned jointly by husband and wife (assuming the debt is only against one of the parties.) An irrevocable trust is also a way to protect your assets, but in exchange for such protection, you are required to give up control over the assets. In fact, this is what allows you to protect the assets because they are no longer yours. Irrevocable trusts allow you to give assets to your kids or other descendants and protect those assets from creditors.

Trusts are primarily used in estate planning for the two main reasons of avoiding probate and protecting assets, but trusts can also serve specific purposes, such as in the situation of a special needs trust. On Real Housewives of Miami, viewers were saddened by the news that Alexia’s son suffered a traumatic brain injury following a car accident. Thankfully, he has made great strides in his recovery, but he continues to require therapy in order to overcome the injury. A special needs trust can be intimidating because of the name, but clients should not let that deter them. Special needs trust can either be first party or third party trusts and serve two major purposes: protecting and controlling assets for those who can not make their own financial decisions, and allowing the beneficiary to still qualify for government benefits if they need to. Do not use an attorney who does not have specific experience with special needs trust. Our attorneys have drafted many special needs trust and can work with you to make sure the trusts achieves everything you desire.

The series demonstrating the biggest need for estate planning and asset protection is The Real Housewives of New Jersey, with tabloid celebrities Theresa and Joe Guidice. Like Sonja, the Guidices face bankruptcy, but they also face numerous fraud charges. Because of this, the typical asset protect techniques would not work. The Guidices situation is one that requires more bankruptcy and tax attorneys than Sonja’s case, but where the Guidices do need estate planning is with their young daughters. Both Theresa and Joe are facing jail time and should therefore make a guardian provision for their daughters. Hopefully you are not facing jail time or deportation, but so long as you have minor kids, you should do a guardian provision. This allows you to decide who will take care of them should anything happen to you and your spouse. Even if you are using a trust based estate plan, a will allows you to include the guardian provision in addition to funneling your rema

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

Take a look at how family is often presented in the media. What do we see? It’s a husband, a wife, two or three kids, and probably a pet. The grandparents, still happily married after all that time, stop by for Thanksgiving dinner, pie under their arms. Sounds like something right out of a Publix commercial. If Flintstones and the Jetsons are any indication, this family set-up has been around since the age of cavemen and will be the norm long into the future. Estate planning for such a family dynamic is quite straightforward. But is this family really the norm? With a national divorce rate hovering around 50%, probably not. In actuality, you probably don’t have the “perfect” family set-up of yesteryear’s media; instead, you need estate planning for your modern family. Since we all differences between our family structure, let’s look at some examples from everyone’s favorite Modern Family: the Pritchetts.

            What would happen if Jay were to somehow die without an estate plan? Well, first, let’s first assume that the family has all moved from California to Florida between the seasons and is now domiciled here at the time of Jay’s death. If he has no will, not even one executed in California (Florida would recognize a validly executed out-of-state will), then the Florida intestacy statutes control how the estate assets are distributed. Since Jay would leave behind a surviving spouse and two kids from a previous marriage, his wife Gloria would receive half of the estate. The other half would go to Jay’s descendants in equal shares. How this remaining half of the estate would be divided depends on whether Jay adopted Gloria’s son from a previous marriage, Manny. If Manny has been legally adopted, then he is Jay’s child by law and can inherit. Otherwise, he would receive nothing. Assuming that Jay did adopt Manny, then Mitchell, Claire, Manny, and baby Joe would each receive an eighth of the estate. Intestate succession in Florida is “per stirpes” which means each decedent receives an equal share. How many children a descendant has does not affect the share he or she will receive. This means that if Claire passed away before Jay, her three kids would each receive an equal share of the eight she would have inherited. Mitchell’s daughter would receive his full eighth share.

            But as we all know, Jay isn’t the type of person to let something as important as estate planning pass him by. Rather, Jay likely had an estate plan in place years ago, and has updated it with every major life event since (his remarriage, his son’s adoption of a child, his son’s marriage, and the birth of his new son). Jay, who built his company from the ground up, would likely want to protect and control his assets for as long as he could. Therefore, he would likely use a trust based plan for his estate distribution. A trust based plan would give him multiple advantages over a basic will. First, Jay would want to leave a great deal of money to his wife Gloria. However, Gloria is already on her 2^nd marriage and is much younger than Jay and will not stay single for long. If she were to get remarried, a large portion of Jay’s assets could end up with her new husband. A trust fund would prevent anyone other than her and later her children from getting the money. Trust funds would also be the best way to give money to both of his minor sons. Jay could name the trustee of his choice to manage the assets until an age where each son is ready to become their own trustee, such as 25 or 30. Trusts would also allow Jay to give money to his two grown children, Claire and Mitchell, while protecting it from their respective spouses, who Jay is not the biggest fans of.

            Claire and Phil, both successful businesspeople, likely have an estate plan in place as well to protect their three children. With two minor children, the couple would be smart to have guardian designations in their estate plan. The two of them would also likely follow Jay’s lead and have a trust based plan. Haillie has yet to show the necessary maturity to manage her own funds and her judgment with men could be described as questionable. Putting her inheritance in a trust fund and setting an age at which she would have full control over it will help to protect the funds while she becomes responsible enough. The same logic applies to their youngest son, Luke. While middle child Alex has demonstrated responsibility and maturity throughout her teen years, she is still a minor and would need a trustee to manage the funds until she becomes an adult. Phil and Claire could require that the children never get to control their own funds, putting a corporate trustee or even their lawyer uncle Mitchell in charge of distributing the funds. The use of trusts funds allows for maximum inheritance protection, but from outside creditors and from the beneficiaries themselves.

            And what of Cameron and Mitchell’s estate planning? As a same-sex couple, estate planning is especially important. The couple was legally married in California, but Florida does not yet recognize same-sex marriage. Therefore, while the couple can receive federal benefits as a married couple, they do not receive any under state law and will not be viewed as married for state intestacy laws. Cam and Mitchell should follow in what is becoming a family tradition and use a trust based plan, though the reasoning is different for this couple. Wills must be probated in court before estate property can be distributed and are public documents. A trust is private; the court is not involved. Cam and Mitchell would be smart to avoid the risk of having their will in front of a conservative judge. Cam and Mitchell should use what is colloquially referred to as “I love you” trusts, where the decedent leaves everything to the surviving spouse, and down to their daughter Lilly. The trusts mirror each other, maximizing the ease of administration and assuring maximum protection for the beneficiaries. Cam and Mitchell’s estate plan should also name a guardian for Lilly, a minor, in the event that they both pass before she is an adult.

            These are just a few of the many situations that can occur with today’s modern families, but it shows just how intricate estate planning can be. Just within this one family, three different approaches were used. Even though each family ended up in a trust based plan, each plan is different, personalized. And that is what you deserve. Don’t find yourself with an estate planning attorney who only cares about taxes, or one who will just cut and paste your name in a form he’s already used countless times.

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

Amusement parks and roller coasters are a mainstream of American culture. The ups, the downs, the rush of adrenaline. However, roller coasters aren’t always the fun ride we hope for. Yesterday, occupants at Six Flags Magic Mountain found themselves in an precarious position after a fallen tree branch derailed their car, leaving the riders stuck for hours. Don’t let a metaphorical branch derail your plans. Have your estate plan done by the South Florida law firm of Wild Felice & Partners.

The largest obstacle that could affect your estate is if you die without a will. If you die without a valid will in Florida, the state’s intestacy laws control how your property is distributed. Depending on your marriage and child situation, your spouse would get as little as one half of the estate and as much as the entire estate. Intestacy can be especially troublesome for same-sex couples, since Florida does not recognize same-sex marriage. Even if you are legally married in another state, Florida will not consider your same-sex partner as your spouse, and he or she would receive nothing under the statute.

The next obstacle that could affect your estate is probate. Probate is a process in which your will is submitted to the court for validation and then ownership of assets your estate to your beneficiaries. Assets in probate are tied up, with accounts frozen. This process usually lasts about six months for simpler estates, but can last a few years for complex estates. Probate can be avoided by using a trust based plan instead of a will based plan. Trusts can make sure that your beneficiaries get their assets quicker, allowing them to return to a sense of normalcy as soon as possible.

The third obstacle that you want to prepare for is creditors. Creditors can affect your estate in a variety of ways. One of the major creditors (and one you can’t protect from) is the IRS. While most estates will not have to pay an estate tax, the estate is still responsible to file an income tax for the year the decedent dies. Other creditors include private creditors that the decedent had during his lifetime. Those debts can attach to the estate and must be paid before the estate assets can be distributed. Depending on the size of the debts, this may greatly decrease the estate’s worth. The third type of creditors are creditors of the beneficiaries. Your beneficiaries may lose their entire inheritance if they have debts at the time they receive the assets. As previously mentioned, you can’t avoid the IRS but a trust can be used to protect from the other two types of creditors. If you put all your assets in a revocable trust during your life, you are taking them out of your estate. When creditors try to get money out of your estate when you die, there won’t be anything in the estate for them to get. In terms of your beneficiaries, giving their inheritance in a trust will protect the assets while still allowing them to benefit from them. If your beneficiaries have creditors waiting for trust distributions, you can instruct the trustee to pay for things for the beneficiary, so the money is never actually in their possession and the creditors can not get to it.

The final obstacle we’re going to discuss to today is failure to update. Whether you choose a trust or a will to distribute your property, you must take care to update the instrument, preferably every three to five years. This will help to protect you against any changes in the law that may affect your plan. Also, change your estate plan after any major life event: birth, marriage, divorce, death. If you get divorced, but don’t update your plan, your ex may find themselves an unexpected beneficiary of your estate.

While there are too many other obstacles to enumerate in a post, our South Florida estate planning attorneys can help you plan for all of them. Keep everything on track and make sure poor estate planning doesn’t derail your life.

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

As Americans make their way back to work after a July 4^th weekend full of beaches, beer, and burgers, we can take a moment to think about what we were actually celebrating. We live in a country that prides itself on freedom and one of those freedoms is the right to devise, to decide what happens with your property once you die. However, this right is one you must take active participation in for it to apply. In fact, if you do not exercise your freedom and execute a valid estate plan, then the state will decide how your assets are distributed.

About 70% of people in the state of Florida do not have an estate plan currently in place. If you die without a will, the rules of intestate succession determine how your property is distributed. These rules are designed to distribute your property how the state believes most people would distribute their property. If you are married and have minor children, your entire estate would go to your wife. This might be what you wanted anyway, but what happens if your wife remarries? A large portion of your estate could go to your new husband when she passes or if they get divorced. And this is just one example where intestacy laws could lead to a bad situation. Put simply, do not let the state decide when you have the ability to decide for yourself.

Once you’ve decided that you are going to exercise your right to devise your property, the next issue is what type of plan will you use: a will based plan or a trust based plan. When most people think of estate planning, they think of wills. Wills are a valid way of transferring ownership of property at your death. However, wills have a few drawbacks. The first is that a will must be probated. Probate is the processof a validating a will and distributing the estate’s assets. Ownership of property can not be transferred from the deceased to the beneficiary without probate and during this extended process, the future owners will likely not have access to the property. Bank accounts are frozen, shares of stock tied up, etc. The second drawback is that a will is a public document, meaning everyone would be able to see your distributions. The third drawback is that the only control you have over the asset is the first bequest. After that, the assets belong to the beneficiary and they can do whatever they want with it.

When discussing trusts, it is important to first dispel the notion that trust funds are only for the wealthy. This is not true. Trust funds have a variety of advantages over a will and are suitable for almost all estate plans. First, a trust avoids probate, the benefits of which have already been enumerated. Secondly, a trust offers more control than a will does. With a trust, you can control an asset for multiple generations, such as to your children for their lives and then to their grandchildren; you cannot do this with a will. Third, the trust offers creditor protection for your beneficiaries’ inheritance. Because each beneficiary receives their inheritance in a trust fund, the assets will be unaffected by creditors or divorce.

Don’t just celebrate your freedom by grilling out or hanging by the pool. Talk to an estate planning attorney today about exercising your freedom and getting an estate plan in place today.

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