Florida Estate Planning Lawyer Blog

An Indianapolis foreclosure attorney was recently sentenced in federal court to three years probation and almost of 300 hours of community servce for defrauding Citifinancial of thousands of dollars through a foreclosure fraud scheme. While working for Citibank, the attorney was required to submit a bid at sheriff's sale on foreclosed homes, sell the home through legitimate means and submit the proceeds of the sale to Citifinancial. Instead of following these proscribed procedures the attorney submitted inflated bids and had arrangements for family and friends to purchase the homes. The purchase price for the home made by his family and friends were for a few thousand dollars more than the Citifinancial minimum bid and the attorney would not send the profits to Citifinancial.

With Florida Trust Litigation on the rise, it is important that trustees preform their duties properly.

One of the primary duties of a Florida Trust trustee is to keep accurate records of all acts performed by him in regards to the trust estate. In Florida, trustees have this duty, known as an accounting, which requires providing these records to the trust beneficiaries. The trustee's accounting should be a reasonably understandable report from the date of the last accounting, or from the date on which the trustee became accountable, that adequately discloses the information required.

Fla. Stat. § 736.08135(2) states the requirements of an accounting:

a) The accounting must begin with a statement identifying the trust, the trustee furnishing the accounting, and the time period covered by the accounting.

b) The accounting must show all cash and property transactions and all significant transactions affecting administration during the accounting period, including compensation paid to the trustee and the trustee's agents. Gains and losses realized during the accounting period and all receipts and disbursements must be shown.

c) If feasible, the accounting must identify and value trust assets on hand at the close of the accounting period. For each asset or class of assets reasonably capable of valuation, the accounting shall contain two values, the asset acquisition value and the estimated current value.

Not everyone is entitled to an accounting and while if the grantor is the trustee, the accounting can be waived. There are many other provisions of the Florida Statutes that deal with accountings. If you are a trustee of a Florida trust or a qualified beneficiary of a Florida Trust and want to find out about your rights, you should contact a Jacksonville Estate Planning Lawyer or Florida Estate Planning Lawyer to discuss you options.

When a Florida Trust is created, the creator of the trust designates a trustee to monitor the trust. There is great responsibility that comes with being the trustee because this individual, or group of individuals handles the distributions to the beneficiaries according to the terms of the trust document. The terms may place numerous restrictions on the distributions made to beneficiaries or the trust may give broad discretion to the trustee to make the distributions. In addition, Florida law places additional requirements on a trustee that may not be apparent from the reading of the document. Circumstances can arise where a trustee wishes to resign their position as trustee.

In order to resign your position as trustee in Florida, you must comply with Florida statutory law. Florida Statute § 736.0705 governs the resignation of a trustee. It says that a trustee may resign if at least 30 days notice is given to all qualified beneficiaries, the settlor (creator) of the trust if still living, and all co-trustees. A trustee can also petition the court for resignation and then may be relieved of their position with the courts approval.

This does not mean that the trustee will escape liability for acts done before the trustee’s resignation. If the resigning trustee has committed some breach of their duties to the beneficiaries, they can still be held accountable for those acts. For more information on your Florida Revocable Trust or if you have any trust administration questions contact a Florida Trust Lawyer today.

Whether you live in Florida, New York, California or any state and are the owner of a Toyota car, truck, or SUV, your Toyota Automobile may have just dropped in value. We all know there will be many Class Action Lawsuits against Toyota. Here is one class action that you may not have considered. Even if Toyota fixes the problems and no one is injured from a defect in your Toyota car, the recent bombardment of news has caused your automobile to decrease in value. You may ask, why is this on a Florida Estate Planning Lawyer's website? What if you are the PR of an estate that owns a Toyota vehicle, a trustee of a trust that owns a vehicle, or the guardian of someone who owns a Toyota car subject to the recall? You may have a duty to investigate what claims of action you might have to avoid liability. Remember that by failing to investigate a claim or pursue one, you may be violating your fiduciary duty.

The good news that whether to pursue these types of claims is a simple one as they are almost always done on a contingency basis. If you have a potential claim you might want to contact Florida Toyota Class Action Lawyer Mike Ossi at (904) 399-0606 to talk about a claim.

The Trials and Heirs blog\ recently had an article about how to avoid exploitation of the elderly by a family member. They recommend

1 Getting Expert advise who knows the ins and outs of estate planning. I would also recommend using a Florida Estate Planning Lawyer who is familiar with Florida Elder Law.
2. Be careful of Joint accounts as they can take the money or create ineligibility for nursing home coverage.
3. Consider "Springing" Powers of Attorney or as we call them contingent Durable Powers of Attorney as they only give powers once you are incapacitated.
4. Choosing Wisely which may mean not choosing a family member or the oldest child because of emotional reasons.
5. Having Checks and Balances by using more than one person to make decisions and to avoid fights.
6. Selecting someone to monitor your accounts. This person can be a trusted advisor and should have the ability to question and stop inappropriate actions.

These are issues that should be dealt with in Florida Estate Planning as well as to avoid abuse of the elderly. To discuss your concerns or issues contact a Florida Estate Planning Lawyer

Florida Revocable Trust's as well as those created in other states often have language that provides for the health, education, maintenance, and support of our spouses and children. Recently I was reading an article written by a CA Estate Planning Lawyer and firearms instructor on providing firearms training as an option within the definition of education. David R. Duringer wrote an article entitled Does the Definition of Education in Your Revocable Trust Allow for Firearms Training? and while it is a short article and only deals with firearms education, it got me thinking about other types of education and training that may be important to your beneficiaries or family tradition that you may want to include in your traditional revocable trust. Obviously this is something that would make sense to provide for in a NFA Gun Trust or a firearms trust designed specifically for firearms. In David's article he goes on to state

Such training can provide your children with the comfort of skill at arms so they can protect themselves and their own children, and furthermore, passes on American values necessary to preserve political independence of families in our society. Other benefits of such training can include increased personal responsibility and lower juvenile delinquency rates.

You may even want to go further with an incentive trust provision actually requiring this training, possibly with achievement standards.

Whether your passion is firearms, golf, tennis, a musical instrument, or anything else its important to discuss this with your Florida Estate Planning Lawyer to draft documents that reflect your goals and help achieve your families desires.

Attorney Kevin W Davidson of the Green Bay Wills, Trusts & Estate Planning Blog wrote an article on the pitfalls of Do it yourself asset protection where he talks about some of the problems with trying to protect your own assets.

Over the last 6 months the number of inquiries for asset protection have significantly increased. Unfortunately most of these people did not take action when they had significant assets without potential liabilities, but are only now beginning to consider it as the liabilities become a certainty. While there are things that can be done at this stage to protect, reduce the risk of loss, or increase the ability to negotiate one's debts, it is always best to address these issues prior to problems arising.

If you would like to discuss Florida Asset Protection you should Contact a Florida Asset Protection Lawyer.

Florida Asset Protection Attorneys can help structure the ownership of assets to protect from liabilities and creditors. Often individuals own a bulk of their assets individually or in a Florida Revocable Trust, or in a corporation. The assets and businesses held in these entities can be subject to the claims of creditors if a judgment is obtained against the individual. In touch economic times like these it is more important than ever to protect your assets from the claims of creditors. You should discuss your assets and potential liabilities with a Florida Asset Protection Lawyer who also knows about Florida Estate Planning to make sure they are protected to the extent possible from claims that could cause you to lose the assets or income you have worked hard to create.

Most residents of Jacksonville and Florida could benefit from a Florida Vehicle Trust if they have children who drive their vehicles or in the case that a judgment is in excess of their insurance limits.

A Florida Vehicle Trust protects your assets by holding title in a specifically designed trust. In Florida the owner and the driver of a Car, Motorcycle, or other vehicle is liable for any damage done by the driver of the vehicle.

Many parents are concerned about damage that their child, or a friend of their child's may do when loaned the vehicle. Using a Vehicle Trust can protect your assets from excess liability that is created when the damage done by the driver and/or vehicle is in excess of the insurance on the automobile.

To find out more about how a Florida Vehicle Trust can protect you, Contact us by email or phone a Florida Estate Planning Lawyer at (904) 685-1200.

One very useful Medicaid planning technique involves the creation of an irrevocable Medicaid Asset Protection Trust. With a Medicaid Asset Protection Trust a person or couple can transfer some of their property to the trust to hold and manage for their benefit during their live with the remainder paid to their family after their death.

Example: David and Beth have assets in their savings and stock accounts of $250,000. They currently live off income from their investments, social security, and other retirement benefits. They are concerned that if they need nursing home care they will not have enough money to support their lifestyle and pay for the medical expenses for the remainder of their life.

Solution: David and Beth decide to transfer $150,000 to a Medicaid Asset Protection Trust. The trust provides that all income is paid to them while alive and in the event one needs nursing home coverage under Medicaid the income is paid to the other. Upon the death of the surviving spouse, the trust will terminate and distribute the remainder to their children. By using this type of irrevocable trust their assets are protected and they receive an income stream for their lives.

Potential Problems: The gift to the Medicaid Asset Protection Trust can cause a period of ineligibility for Medicaid benefits. The length of the ineligibility period depends upon 1) the value of the assets given away and 2) The date the assets were given away. After the ineligibility period, the assets in the Medicaid Asset Protection Trust should be protected and not counted as a disqualifying asset for Medicaid planning purposes. In addition, this removes the assets from the reach of the spouses.

A Medicaid Asset Protection Trust is not for everyone, but it can be a means of protecting a family's financial security. These trusts can be complicated and must be tailored to the families resources and needs. It is important that you use a Florida Elder law attorney who is familiar with the Florida Medicaid laws and who has experience in creating this type of trust.

Please note: The Irrevocable Medicaid Asset Protection Trust is not the same as a "revocable trust", "revocable living trust" or "living trust" that is currently being sold through Trust Seminars.

Contact us by email or at (904) 685-1200 for more information.

a Florida Revocable Trust is a trust created during the life of an individual which can be modified, amended, or revoked at anytime during their life. Often they are used to:

1. avoid Florida Probate;
2. Keep your assets and decisions private;
3. Simplify after death distributions;
4. Increase the amount of the estate tax exemption for a couple;
5. Simplify the management of the beneficiary designations on property and other assets; and
6. Keep property separate in the case of a divorce.

The downside to a revocable trust is that assets are considered your personal assets in the case of creditors. There are techniques that can use a Florida Limited Liability Company (LLC) in conjunction with Florida Revocable Trust to protect assets. In most cases, these are not implemented and the trust by itself will offer no asset protection except in the case of a subsequent marriage and divorce.

A Florida Irrevocable Trust cannot be easily changed after the trust is created. It often takes consent of the creator, beneficiary, and trustee or judicial modification. A Florida Revocable Trust becomes irrevocable after the Settlor or Grantor dies. Florida Revocable Trusts are often used for:

1. Estate tax reduction;
2. Removing Life insurance proceeds from one's taxable estate;
3. Asset protection for the creator;
4. Asset protection for the beneficiaries;
5. Charitable Estate Planning; and

To determine what type of Florida Trusts would be best for you, you could Contact a Florida Trust Attorney or a Florida Estate Planning Lawyer

Greedy Trustees can be a problem in Florida Probate Litigation and Florida Trust Litigation. Often the Trustee must be removed to resolve the issues. Adrian Thomas a Florida lawyer who specializes in Florida Trust and Probate Litigation sent me an article where he discusses individual and corporate trustees. Often banks and financial institutions make their money by managing Florida Revocable Trusts and Florida Irrevocable Trusts. In recent interviews by news organizations, some employees talked about abuse of powers and improper investments that placed profits ahead of the best interest of the beneficiaries of the Florida Trusts.

Some of the abuses included:

Charging inflated fees;
Making distributions difficult for the beneficiaries;
Not considering compelling circumstances for distributions of allocation of principal and income; and
Naming themselves beneficiaries or trustees in the wills of elderly Florida Citizens.

The new Florida Trust code is modeled after the Uniform Trust code and now provides legal remedies for the beneficiaries who are being victimized by greedy trustees.

The new Florida Trust Code includes remedies which allow the court to inquire into the appropriateness of a trustee and evaluate a change in circumstances for a judicial modification of the trust. In addition, Section 736.0706(2)(d) allows a trustee to be removed when there is a change in circumstances and the removal would best serve the interest of the beneficiaries.

Many of these problems can be addressed in the drafting of the Florida Living Trust by creating language and terms that beneficiaries can remove or modify the terms when it is in the best interest of the beneficiaries. In addition, judicial modification is a process where the court can modify a trust for similar circumstances. In Aelillo v. Hyland one beneficiary was favored over another beneficiary. The Florida Court removed the trustee because of conflict of interest.

If you feel that your are not being treated fairly by the trustee of a Florida Trust which you are the beneficary of Contact a Florida Estate Planning Lawyer who deals in Florida Probate Litigation or Florida Trust Litigation

Spendthrift clauses can be confusing to trustees. The general idea with a Florida Spendthrift clause is that the beneficiaries cannot assign their interest in the trust to a creditor ( voluntarily or involuntarily)

Here is the test found in a typical clause under the new Florida Trust Code

Spendthrift Provisions. Each trust created by this Trust Agreement shall be a spendthrift trust to the fullest extent allowed by law. Prior to the actual receipt of trust property by any beneficiary, no property (income or principal) distributable under any trust created by this Trust Agreement shall, voluntarily or involuntarily, be subject to anticipation or assignment by any beneficiary, or to attachment by or to the interference or control of any creditor or assignee of any beneficiary, or be taken or reached by any legal or equitable process in satisfaction of any debt or liability of any beneficiary, and any attempted transfer or encumbrance of any interest in such property by any beneficiary hereunder prior to distribution shall be void.

The most common application of a Spendthrift Provision is to protect against involuntary assignment or bankruptcy.

While this may be fine with a small estate, this question often comes up with larger estates.
Why would I want to void my child's right to his 5 Million dollar distribution to avoid paying his creditors $25,000. Would it not be better in such a case to pay of the creditor and let my child enjoy and use the benefits of the trust rather than treat his a being predeceased?

Although it is not clear, the trustee can take this into consideration and make the distribution even though the creditor will receive a small portion of the decedents estate.

In these types of cases, I prefer to include language that a trustee can, in their discretion, make a payment when they know that a portion will go to a creditor of the beneficiary. Some times there is a limit placed on the amount and other times there is no limit placed on the maximum amount that can be used to pay a beneficiaries debts.

The Louisiana Estate Planning Law Blog has an article Whether you should include a "Spendthrift Trust" in your will? where they discuss using a spendthrift trust to prevent your children from loosing the money you leave to them.

If you want to make sure your children do not spend or loose all the money or assets you leave to them. It is also common to include a spendthrift provision in a NFA Gun or Firearms Trust to protect the items from being lost to a creditor. To find out more about how a Spendthrift Clause can help you Contact a Florida Estate Planning Lawyer
about including a Spendthrift Provision in your Florida Estate Planning Documents

A Florida Life Insurance Trust is an irrevocable trust that allows an individual to make the proceeds of a life insurance poliicy free from income taxes and estate taxes. Typical life insurance policies are income tax free, but many increase the value of one's estate to the point that the federal and or state income taxes are due. By using an ilit one can avoid these taxation issues.

In 2008 the Federal tax exemption is $2,000,000. Lets take a client with 1.5M in assets and a 1M life insurance policy.

If they were to die in 2008 their estate would be valued at 2.5M and 500,000 would be subject to estate taxes. The current estate tax rate is 45% so this estate would have to pay a tax of $225,000.

In 2011 the estate tax exemption is only $1M. With an estate valuation of $2.5M, 1.5M would be subject to estate taxes. Using the same tax rate, this estate would have to pay $675,000.

To find out if or how a Florida Life insurance trust can help you please Contact a Florida Estate Planning Lawyer.

When creating a revocable trust you may be asked for a Employment ID number (EIN) or Tax ID to open the account or fill out the paperwork. Many banks do not understand the difference between a revocable and a irrevocable trust. Although irrevocable trusts require TAX ID or EIN's revocable trusts do not require them.

When this happens to you, it may be difficult to get them to understand why they do not need this information. It is best to just fill out that section with your social security number - which is your Tax ID number.

If you have questions on a Florida Revocable Trust you should Contact a Florida Estate Planning Lawyer.