A band of burglars recently pulled off a jewelry heist involving $1 million worth of red carpet loot from the Cannes Film Festival 2013. Although the uninsured jewelry was believed to be protected through the use of a safe – the bandits one-upped ‘em by simply unscrewing the entire safe from the wall.

The shock; the horror! How can we have faith in humanity when even the stars have been ravished of their bare necessities? The good news is, you Cannes protect yourself! Here in Florida, there are a variety of estate planning methods that can be used to protect your assets.

The truth is you don’t need $1 million in jewels in order to implement safety measures, as EVERYONE needs estate planning. Regardless of how much or how little you own, the goal remains the same:

• asset protection
• control over your assets
• protecting your loved ones
• preclusion of unnecessary taxes
• creditor protection
• limited/no transfer taxes for following generations
• insuring your assets

For example, in South Florida, if you die without a will all of your assets will be automatically distributed “per stirpes.” The danger in this is that you lose all control over who will receive your estate, and your intentions become irrelevant. The statutory scheme may leave out groups of loved ones, such as stepchildren; and does not protect beneficiaries that are not mature enough to deal with a large inheritance. Such issues are unlimited, but can be avoided through proper estate planning.

By utilizing estate planning techniques, you can protect yourself and your family from unnecessary hassles while safeguarding your assets. Through a variety of estate planning tools, including Trusts, Wills, Powers of Attorney, Health Care Surrogates, Funding Techniques, and more; you can make your “safe” burglar proof!

For more information on successful Florida estate planning and business succession planning, 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 jackpot for Saturday’s Powerball drawing has surged to a new record breaking $600 million. Tickets are selling at a rate of 6,000 per minute, as all of America is looking to get real rich, real quick – the American Dream, right? For $2 per ticket, that $600 million could be yours. Test your luck … your 1 in 175,000,000 luck.

We have all had that conversation: “what would you do if you won the lottery?” A man’s answer is usually summed up with a short description of the loud-yellow sports car that will be titled in their name as soon as the Lottery Commission strokes the check. The ladies are more prone to express a story of traveling the world, and using the money to live their own version of “Eat, Pray, Love” meets “Sex & The City” (aka eating aesthetically pleasing foods in Italy with a closet full of Chanel & Christian Louboutins).

While winning the lottery is a game of lady luck; getting that $600 million to last beyond the first year of lavish luxury is no such thing. Research shows that winning the lottery could make you more likely to go bankrupt.

You have all heard the stories, like Callie Rogers who blew through her $3 million in winnings on shopping (think closet full of Chanel & Louboutins), and a breast augmentation. Let’s not forget the lucky son-of-a-gun, William Post, who spent his lottery fortune of $16 million on homes, cars (think obscene/obnoxious/yellow sports car), and bad business investments before he was locked up for shooting at creditors with his shotgun. So the tides have turned, and the “lucky ones” aren’t looking so lucky. But who needs luck in South Florida when there is Estate Planning?

Here are a few concerns & suggestions to avoid the unlucky misfortunes of the luckiest of them all:

1. Income taxes – we are all fully aware, income taxes are never a game of luck. As Spiderman’s Gramps said, “with great power, comes great responsibility.” Let me clarify, “with mega-millions comes mega-taxes.” Lottery winnings are taxable income when they are received. The lottery winner can choose between a lump sum payment or yearly installments. Therefore, if the lottery winner elects to take a lump sum payment, the entire amount is reported as income that very year. On the other hand, a winner who receives yearly payments only reports the amount received that year. Of course, the yearly installment sounds desirable for income tax purposes; however, for estate tax purposes, the lump sum arrangement will prevent the lottery winner’s descendants from assuming a potentially large tax obligation. If you decide on a lump sum deal, but like the idea of installments, you can create a trust as the winner of the prize, and set up your own method of annual payments.
2. Gift Tax – so you’ve won $600 million, and you naturally want to buy your Momma a new house, and your Pops a new truck, and maybe even a trip around the world for your friends. No special treatment for lottery winners, the same gift tax rules apply. You can make tax-free gifts to any number of individuals as long as the total amount given to each beneficiary (each year) does not exceed the annual exclusion amount, which is $14 thousand for the year 2013. Anything beyond that amount is subject to gift tax.
3. Estate Tax – the lottery winner’s estate may be subject to estate taxes upon death. There is currently an exemption of $5,250,000 that is not subject to estate taxes. By planning ahead, the “lucky,” yet wise, lottery winner can use estate planning strategies to avoid leaving too much in their gross estate (aka, more taxes). By using estate planning techniques, you can achieve transfer-tax-free wealth depletion, flexibility, limited taxes for your descendants, asset protection, and control over asset distribution.

The moral of this story:

• If you are just “lucky,” you will likely end up as a maid or in jail for shooting at creditors (like our friends mentioned above).
• If you are lucky and smart, you will hire an estate planning attorney, and blissfully live out your days of lavish-luxury in peace.

For more information on successful Florida estate planning and business succession planning, 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

Last week the Miami Dolphins were dealt a crippling blow when they were denied public money for a stadium upgrade.  Without a major rehab of the beloved stadium, South Florida’s chances of hosting the 50th Super Bowl in 2016 are greatly reduced.

Stephen Ross, the current 95% owner of the Miami Dolphins, sought both state and local help to pay for an estimated $400 million worth of renovations to Sun Life Stadium.  The team worries that the stadium, built in 1987, may become inoperable without the proper renovations within the next 5 to 10 years.   Florida’s Legislature didn’t see it that way, and adjourned after refused to allow a vote on this bill.  Rep. Carlos Trujillo, a Republican from Miami, simply stated, “It was a bad deal for taxpayers.”

If only the former owner of the Miami Dolphins, Joe Robbie, would have completed his estate plan before he died…

Joe Robbie is Florida’s greatest example of dealing with the consequences of not having a proper estate plan or business succession plan in place.   Joseph Robbie was the owner of the Miami Dolphins and founder of the Joe Robbie Stadium.  Upon his untimely death in 1990, his estate was valued at $100 million.  9 months after his death, he owed approximately $47 million in estate taxes.  The family was forced to sell the Dolphins and the stadium at a bargain-basement price, at just a fraction of the team’s real value.  In 1994, Financial Planning magazine reported, “the year’s biggest loser in the National Football League is the Robbie family, the former owner of the Miami Dolphins.”

The real tragedy is that it all could have been avoided had Robbie implemented a simple life insurance policy to pay the estate taxes.  Instead, the family was torn apart by the stress of the forced sale.  Just imagine the worth of Robbie’s 2 prized assets in today’s market place had he done some proper estate and business succession planning?

As great a businessman as Joe Robbie was, he missed a major league opportunity to provide for his family.  A proper game plan for succession of your business and the estate taxes that may be due upon your death, will allow you to leave a lasting legacy to preserve everything you worked so hard to achieve.

For more information on successful Florida estate planning and business succession planning,  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?

This week famed NBA center Jason Collins came out as the first openly gay athlete in a major men’s American team sport.  “I’m a 34-year-old NBA center. I’m black. And I’m gay,” Collins stated in the May 6, 2013, issue of Sports Illustrated.

Motivated by the recent Boston Marathon bombings, Collins acknowledged that he was done waiting for the perfect moment to come out.  He stated “things can change in an instant, so why not live truthfully?”

In a world of uncertainty, it is imperative that gay and lesbian couples to take advantage of proper estate planning.  The current laws do not afford same-sex unions the same legal protections as traditional married couples.  As it stands now your partner will most likely inherit nothing upon your death and could even be forced to move out of your shared home.  Same-sex partners in Florida also have no legal rights in the following areas:

• No elective share, or inheritance of a portion of the deceased’s estate.
• Not considered next of kin regarding decisions about your partner’s medical treatment when your partner is incapacitated.
• Not considered next of kin regarding hospital visitation rights.
• Not considered next of kin regarding decisions about your partner’s burial services.
• No protective tax treatment in terms of IRA’s and retirement plans.
• No shared access to their partner’s Social Security benefits or Medicare benefits.

Don’t just sit idle hoping that everything will work out.   Make sure your beloved partner is protected upon your passing.  At Wild Felice & Partners, we can work with you to draft a comprehensive estate plan to recreate some of the rights and benefits of traditional married couples.  Some key elements include:

• Last Will and Testament to ensure that your estate is not blindly distributed according to intestacy laws.
• Living Will which will specify how you would like to be taken care of in case of incapacity.
• Designation of Health Care Surrogate which will allow your same-sex partner to give informed consent for your medical treatment.

Our South Florida law firm treats estate planning in terms of a married couple, so the fee plan for a same-sex couple will naturally get the same treatment.  For more information on how to plan for your partner’s future, contact our South Florida law firm of Wild, Felice & Partners, PA for a free consultation at (954) 944-2855.

As President Barack Obama officially declared the Boston Marathon explosions “acts of terrorism,” Americans were quick to rally and show off the true spirit of our nation.  Tons of Boston businesses handed out supplies and offered safe havens for all affected.  Hotlines opened up as did blood banks throughout the US and in South Florida.  And as always, the donations of generous Americans started rolling in.

In the wake of yesterday’s tragedy, we are reminded with just how fragile life is and how lucky we are.  Many of us want to donate to charities that help victims and their families.  For those fortunate enough to make sizeable donations, the US government rewards such gratuity.

A smart way to qualify for income tax and estate tax deductions are through two common estate planning techniques known as Charitable Lead Annuity Trusts or Charitable Remainder Trusts.      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.  This will be treated as a charitable deduction and can substantially reduce your overall federal estate tax.   A Charitable Remainder Trust (“CRT”) is an irrevocable trust.  Once created, this trust distributes a portion of its assets at least once a year to a non-charitable beneficiary.  After a specified number of years or upon the death of the trustee, the remaining balance in the trust is donated to a designated charity.  This type of trust can immediately reduce an individual’s taxable income.

But the intricacies of such charitable trusts are best handled by experienced Florida estate planning attorneys.  For more information on Florida income tax and estate tax deduction 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

Athletic officials from the New Jersey University, Rutgers, announced the early termination of their infamous Men’s Basketball Coach, Mike Rice.  The decision was based on a videotape depicting Rice hurling balls and gay slurs at his players.  As ESPN broadcast the incriminating footage, Rice’s behavior can be summarized in one word…foul.

Everyone from LeBron James to Governor Chris Christie weighed in on the coach’s shameful behavior. The inevitable decision to fire Rice 3 years into his 5 year contract sealed the fate on his career.  Rice will be forced into an unexpected early retirement.  Given the state of our economy, many South Florida residents have also had to face the prospect of an early unexpected retirement.

So what happens when you find yourself without the steady income of a job and bills to pay?  Though it is best to avoid taking money out of your retirement plan, emergency situations such as job termination, divorce, sickness, and economic crashes can get the best of us.  You may be pleasantly surprised to find out that there are some instances when you can take money out of your retirement plans without paying the 10% federal penalty imposed by the IRS.

Here is a list of Uncle Sam’s most common exceptions:

• Borrow from your own 401(k). You can legally borrow up to $50,000, or half your vested balance, whichever is less, from your 401(k).  Most big firms allow these loans and give you up to 5 years to repay it without any taxes or penalties.  However, if your job terminates for any reason, your ex-employer will likely demand repayment, otherwise the outstanding balance will be treated as an early distribution, subject to penalties.
• Paying Large Medical Bills.    You can request a distribution from an IRA or 401(k) without any penalties for CERTAIN medical expenses.  Note that only expenses that are more than 10% of your adjusted gross income will qualify.
• Paying for Health Insurance.  If you become unemployed, you can take money out of an IRA account (not a 401K) to obtain health insurance for yourself, spouse, and dependents, without paying a penalty.  To qualify, you must be collecting unemployment for at least 12 weeks and this exemption ceases 60 days after starting a new job.
• Disability. If you become disabled before age 59½, you may be able to take penalty-free distributions from an IRA. However, you must carefully understand what qualifies as a permanent physical disability that prevents you from being gainfully employed, as per Uncle Sam’s legal and medical guidelines.
• Inheriting an IRA.  If you are the beneficiary of a deceased owner of an IRA, you can take money from an “inherited IRA” without penalty at any age. Note that if you roll the inherited IRA into your own name, you lose the ability to take out money without paying the penalty. Note that unlike an IRA, a 401k will automatically transfer to a surviving spouse no matter who the designated beneficiary is.
• Paying for Education. You can take money out of a pre-tax IRA account to pay for undergraduate or graduate tuition, books, supplies, and fees for yourself, your children, or grandchildren.  Be careful however, because IRA withdrawals will count as income and MAY limit eligibility for financial aid for the following year.
• First Home Purchase.  You can take up to $10,000 penalty-free from an IRA (not a 401K) to pay for the purchase or building of your first home.  If both you and your spouse will be first time homeowners, the amount doubles to $20,000.

But with all of these tips, the devil is in the details.  It is always best to seek the advice of a well-seasoned Florida attorney before making any major financial decisions.  With the help of our experienced South Florida estate planning attorneys, we can make the complex United States tax-code work for you, no against you!

For more information on successful Florida early retirement tips 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