By Phil Rarick, Weston Trust Attorney, and Jasmine Benitez, Legal Assistant

Many real estate investors wrongly believe that a Florida Land Trust can offer asset protection. While this type of trust is known for providing privacy and simplifying estate planning, they do not provide comprehensive protection from creditors or legal claims. A better option is often a multi-member Florida limited liability company with a strong operating agreement that takes advantage of Florida’s anti-Olmstead law.

What Is a Florida Land Trust?

A Florida Land Trust is a legal structure where a trustee holds the title to a piece of property, but the beneficiary (property owner) maintains control. The beneficiary has all rights to use, manage, and profit from the property, while the trustee’s role is to handle administrative tasks. One of the most notable benefits of a Land Trust is that the beneficiary’s identity remains private, as the trustee’s name appears on public records instead.

Note: This means that if you wish to protect your privacy, then you cannot be the Trustee; you need to find a third party whom you trust to serve as Trustee.

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Can a Florida Land Trust Protect Your Assets?

While a Land Trust offers privacy, it is important to clarify that it does not provide true asset protection in the way that many people assume.

1. Limited Protection Against Creditors

A Florida Land Trust does not protect property from creditors or legal judgments because it is typically a self-settled Trust. If you face a lawsuit or have outstanding debts, creditors can still pursue the property held in the trust. Even with a Florida Land Trust, a creditor who obtains a judgment against you can still gain access to the property. The trust does not block creditors from identifying the beneficiary or forcing the sale of the property.

2. Lack of Lawsuit Protection

While the Land Trust keeps your name off public records, it does not prevent lawsuits or other legal actions from impacting on the property. If you are sued personally, your real estate holdings may still be at risk, as the trust doesn’t offer the same protection as forming an LLC or other business entities that legally separate assets.

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How Can a Florida Land Trust Be Used in Your Estate Plan?

While this trust itself does not fully protect assets, it can still be part of a broader asset protection strategy.

• Simplified Estate Planning: A Land Trust facilitates the easy transfer of property to heirs without probate. However, this advantage does not extend to asset protection against creditors.
• Combined with an LLC: For stronger asset protection, pairing a Florida Land Trust with a Limited Liability Company (LLC) can help separate your personal assets from your real estate holdings. An LLC offers protection from creditors by shielding your assets from liability tied to the property.

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Conclusion

Get it right the first time. To explore your best legal options to protect your real estate investments, contact an experienced Weston estate planning attorney who also concentrates on asset protection.

For more information, contact Phil Rarick, Weston Trust Attorney, at info@raricklaw.com.

Special Note

The information on this blog is of a general nature and is not intended to answer any individual’s legal questions. Do not rely on the information presented herein to address your individual legal concerns. If you have a legal question about your individual facts and circumstances, you should consult an attorney who is experienced in Florida trust law. Your receipt of information from this website, blog, or Miami trust attorney does not create an attorney-client relationship and the legal privileges inherent therein.

By Phil Rarick, Weston Trust Attorney

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Every family needs instructions in the event of disability or death. A Family Trust, also known as a Living Trust, is your detailed, legally binding instructions to care for you and your family in the event of mental incapacity or death. A trust can accomplish all the goals of a will and in addition avoid probate and guardianship when properly funded. A will must go through a bureaucratic, expensive and time-consuming legal process called probate where the court may intervene in your personal or business affairs. This is why the Revocable Family Trust has become the preferred plan of choice over a will for most people; it is almost certainly the best plan if you have children.

Understanding a Family Trust – a/k/a Living Trust

There are three primary roles in a Family Trust: the grantor, trustee, and beneficiary.

The grantor is the person who makes the trust; the Trustee is the person who is legally found to follow the trust instructions exactly as stated in the Trust. And the beneficiary? Every dime of the trust must go to the beneficiaries. Initially, you can be the Grantor, Trustee, and, along with your spouse or children, the Beneficiaries.

Most Family Trusts are revocable because the grantor wants to retain 100% control over the trust instructions and change them whenever he or she wants at any time during their lifetime.   Control and flexibility are two key goals in Trusts.  The Trust has a major advantage over the mortal person: it does not become incapacitated, and it does not end at death.  It continues to provide for your family as long as needed to help protect the lifestyle of your family.   If you have children, it can help ensure they get a high-quality education and that the funds cannot be claimed by a spouse or creditor of the child.

Key Benefits of a Revocable Family Trust

1. Avoiding Guardianship. Guardianship is a bureaucratic legal process where the court supervises the person and/or property of a person.  The court selects the Guardian.    In my 30 years of practice as a Miami Trust attorney, I cannot recall anyone who wanted to allow a court to intervene in their personal or business affairs; almost all persons want a family member to take charge if they have a temporary or permanent incapacity.  A trust can help you keep legal control in the family.

2. Avoiding Probate. One of the biggest advantages of a family trust is that it allows assets to bypass the probate process provided the Trust is properly funded. Probate is the court-supervised process of distributing a deceased person’s estate, which can be time-consuming, costly, and public. By transferring assets to a family trust, those assets can be distributed directly to the beneficiaries without the need for probate, saving time and money.

3. Protection for Minor Children and Young Adults. The Trust can help ensure that funds going to minor or adult children are used in a smart way.    For minor children, a trust can help ensure that the minor child does not waste the funds by getting a big lump sum payment or that the funds could be claimed by creditors of the child after age 18.  Rather, the trust can help ensure the child receives a first-rate college and graduate education. For adult children who may marry or are already married, the trust can provide protections so the adult child’s spouse cannot claim funds designated for the child.

Conclusion Whether you have $100,000 or over $1 million you should first consider a Family Trust or a Living Trust over a Will for your estate plan as a Trust that is properly funded will help avoid the bureaucratic legal processes known as guardianship and probate. Plus, the trust can provide strong protections for minor and adult children to make sure your hard-earned money is used in a smart way for your children’s future.

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For more information about the Family Trust or Living Trust see our short guide, Understanding Living Trusts by Miami Trust attorney Phil Rarick or contact our office at (305) 709-2858 for a consultation.

Notice: This article is intended for informational purposes only. It is important you consult with an experienced Miami Trust attorney. For more information contact attorney Phil Rarick at  (305) 709-2858 or by email prarick@raricklaw.com.

By: Phil Rarick, Miami Trust Attorney You will miss this deadline if you do not read carefully – and you may need a magnifying glass to find it. Around the last weeks of August, you should have received in the mail a “Notice of Proposed Property Taxes” or “TRIM Notice” from your county property tax appraiser. This is NOT a bill but a notice. Buried at the bottom of your Notice in small print is an important deadline for appealing your tax assessment.

Clearly, the county does not want to encourage you to appeal your property taxes, exemptions, or right to claim homestead for your primary residence that you live in. Note these deadlines:

• Miami-Dade: The deadline for you is at the bottom of your Notice according to the Property Appraiser’s website. This is the deadline that is binding on you. The deadline on the TRIM notice I received for the property in Miami Lakes said September 17, 2024. Note, however, that your deadline is the one listed on the notice that you received. For more information click: Miami-Dade Trim Notice.
• Broward: September 18, 2024. For more information click: Broward Trim Notice.

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Should You Appeal? If your taxes have significantly increased, you may wish to consider an appeal of your assessment. Approximately 40% of appellants are able to successfully challenge their property tax assessments. The cost to appeal is only $15.

What To Do: If your property taxes have significantly increased, we recommend you have the valuation screened by a professional who is experienced in challenging assessments before the Value Adjustment Board. Many professional appraisers will take your case on a contingency fee; you simply need to pay the $15 filing fee. You need to make your own independent assessment of a professional to do this work.

Note: Our Firm does not do this appeal work and makes no recommendations of professionals who do; this notice is strictly a public service reminder courtesy of the Firm.

Homestead: Make sure you check your TRIM notice for your primary residence to confirm that you are receiving the Homestead tax exemption. Miami-Dade Appraiser cautions: Do Not Jeopardize Your Homestead Exemption by renting your homestead. When renting your home periodically for more than 30 days in two consecutive years, you will be ineligible for the Homestead Exemption or the SOH Cap.

Remember: It is not necessary to have all your evidence before you file. If in doubt, pay the $15 and file your appeal. The most important goal at this point is to get your appeal filed on a timely basis if you want to appeal. After the deadline, it is exceptionally difficult to file.

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Special Note

The information on this blog is of a general nature and is not intended to answer any individual’s legal questions. Do not rely on the information presented herein to address your individual legal concerns. If you have a legal question about your individual facts and circumstances, you should consult an experienced Miami probate attorney or Miami Trust attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

By Phil Rarick, Miami Trust Attorney

Naming a minor child as a beneficiary of a will, life insurance policy, IRA, 401K, bank account or any other source of fund is almost always a substantial mistake for four reasons:

1. If the funds are over $15,000 a guardian ad litem may need to be appointed by the court for the minor to access the funds upon death or disability of the parent. See F.S. 744.301. Court costs to petition the court and secure such funds on behalf of the minor could run from $3,000 to $5,000.
2. Upon reaching the age of 18 the minor becomes of legal age and can immediately claim all funds. Therefore, if the goal was to set aside the funds for the child’s education, then these funds are likely lost. How many 18-year-olds have the money management skills to handle any significant sum of money? Would they use the funds for college tuition – or purchase a bright yellow Mustang? You may think your child is the exception, but do you really want to take this risk?
3. After age 18, the funds can be attacked by creditors of the child. Let’s say the child gets an American Express card and maxes out the credit card. American Express could have a claim on your adult child’s inheritance.
4. If distributed at age 18, the funds will be considered as available funds for any financial assistance or scholarship the adult child seeks for college or university entrance. In a properly structured trust, the funds would not be factored into such need based financial assistance.

Much Better Options

1. Prepare a Protective Educational Trust or Safe Harbor Trust For Minors as part of your revocable living trust or in a separate irrevocable trust. Such Trusts would allow you to appoint a person you trust to act as a trustee for any monies you intend to go to your minor children or grandchildren. These types of Trusts can also help ensure that every dime is used for the benefit of your child – and no one else. See our Quick Reference Guide: Understanding Living Trusts For Florida Residents.
2. Do not name minors a primary or contingent beneficiary of life insurance.We see clients often get poor advice from life insurance agents on this point. For married couples, it is popular to name the other spouse as primary beneficiary and children as contingent beneficiaries. If the spouse does not survive, and the funds go to the minor children, you have all the four problems mentioned above. Rather, consider a revocable or irrevocable trust that names your children as beneficiaries and provides guidelines for when the funds can be distributed. Trusts come in thousands of different variations – consult a Miami trust attorney to help you decide how best to structure the trust.
3. Do not use Uniform Gift To Minor Accounts or UGMA accounts – except for small sums under $1,000. These accounts are overused. The beneficiary of a UGMA (Uniform Gift to Minor Account) can receive the entire sum at age 21. These funds are much better protected if they flow into a trust.

For more information about protecting funds for your minor children, contact an attorney at Rarick Trusts & Wills Law at (305) 709-2858 or info@raricklaw.com. As Miami trust attorneys, with over 60 years of collective experience, we welcome the opportunity to meet with you and discuss your best legal options.

Notice: This article is intended for informational purposes only. It is important you consult with an experienced Miami Trust attorney. For more information contact attorney Phil Rarick at  (305) 709-2858 or by email prarick@raricklaw.com.

Its a New Year and time to file your 2026 Annual Report if you own a Florida LLC (limited liability company), corporation, or partnership. The deadline is May 1, 2026. The state will charge you a $400 late fee if you miss this deadline.

The official Florida web site is www.sunbiz.org. This site has “Consumer Notices” to alert you to bogus web sites that try to scam persons who file these reports.

How To Safely File

The legitimate email notice will state that it is from the Florida Department of State; Subject: Official 2025 Annual Report Notice for: [Name of your corporate entity].

This notice will give you instructions on how to file on line at www.sunbiz.org where you will find a banner that states, “’Florida Department of State, Division of Corporations”.

Florida Department of State fees for the annual registration of corporate entities are:

• Limited liability company: $138.75
• Corporation: $150.00
• Limited Partnership: $500

Watch For These 3 Scams Scam #1: F.C.F.S. – Florida Corporate Filing Services. This outfit sends you a notice in the mail that looks like they are official certificates from the State of Florida with a Tallahassee address and will request about $47 for a Certificate of Status. In another scam they may request $125 for filing corporate minutes. People are tricked into thinking such documents are required by the State – they are not. Scam #2: Corporate Filing Services Center. This group requests about $68 for a certificate of status – again, not required by the State. Scam #3: C.F.S – Certificate Filing Service. This gang has exceptionally impressive and official looking paper that resembles the quality paper of a birth certificate. They will request about $49 for a certificate of status. This is NOT required by the State. Note: The Department of Agriculture and Consumer Services (DACS) now has the statutory duty and responsibility to investigate potential scams and fine violators under the new “Government Impostor and Deceptive Advertisement Act” (GIDAA). For more information, see section 817.417, F.S. or visit the FDACS’s Division of Consumer Services. Good Time To Review Your Corporate Records – and Update Them

This is a good time to conduct an annual review of your LLC, corporation or limited partnership.

We have prepared a 10 Point Checklist to assist you. To get this list click here: 10 Point Checklist For Florida Corporate Entities

It may be advisable to make an appointment with our office to ensure your corporate minutes are properly prepared, are up to date, and accurately reflect key issues, such as who are the controlling officers, who are the owners, and what shares or units does each owner hold.

To schedule an appointment, call our office at (305) 709-2858 or email info@raricklaw.com.

Special Note

The information on this blog is of a general nature and is not intended to answer any individual’s legal questions. Do not rely on information presented herein to address your individual legal concerns. If you have a legal question about your individual facts and circumstances, you should consult an experienced Miami asset protection attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

Florida’s short 6-month statute of limitations on a trust accounting can be a sand trap for the qualified beneficiary of a Florida trust. Here are some quick tips based upon our years of experience as Miami Trust attorneys.

Statutory Language

It is standard practice for professional Trustees to place a limitation notice on all Trust accountings or trust reports to cut off beneficiary claims concerning the accounting or report.

Here is the statutory language, but note the notice does not need to mirror this language:

An action for breach of trust based on matters disclosed in a trust accounting or other written report of the trustee or a trust director may be subject to a 6-month statute of limitations from the receipt of the trust accounting or other written report. If you have questions, please consult your attorney. F.S. 736.1008(4)(c) Note: Effective July 1, 2022, this statute now applies to Trust Directors (also referred to as Trust Protectors or Trust Advisors).

Trust Accounting

Per F.S. 736.1008(4)(b) “Trust accounting” means an accounting that adequately discloses the information required by and that substantially complies with the standards set forth in F.S. 736.08135. This statute is very specific regarding the details of the accounting, and among many other items, the accounting must show “ . . . compensation paid to the trustee and the trustee’s agents.” Therefore, in addition to compensation paid to the Trustee, the accounting or report must disclose payments to the Trustee’s attorney, CPA, financial advisor, or other agents. As Miami Trust attorneys, our experience is that disclosure of such compensation is often conveniently overlooked.

Upon receiving such a notice, the beneficiary may consider sending the Trustee an objection to the accounting. But is such an objection enough to toll the running of the 6-month statute of limitations? The statute states an action for breach of trust must be filed. Therefore, the safe approach for a beneficiary is to either file the action or secure a tolling agreement with the Trustee.

As we noted in a prior blog, under Florida law a beneficiary has an exceptionally broad range of statutory remedies if a trustee breaches its multiple fiduciary duties owed to the beneficiary. See 7 Effective Legal Remedies for Florida Trust Beneficiaries. However, failure to timely respond to a 6-month statute of limitations notice may eliminate some or all remedies.

3 Take-Aways for the Beneficiary

1. Look for the limitation notice on all accountings or reports from the Trustee.
2. If you find such a notice calendar accordingly.
3. If the Trustee fails to comply with your objection, file your action within the 6-month window or secure a tolling agreement with the Trustee.

Note: For more information, see 5 Key Rights of a Florida Trust Beneficiary. 3 Takeaways for the Trustee

1. Always put the F.S. 736.1008(4)(c) limitation notice on all accountings and reports to the beneficiary.
2. Have a CPA who is experienced in Florida trust accounting prepare the accounting to comply with F.S. 736.1008(4)(b).
3. Failure to give beneficiaries a limitation notice may result in a 10 year statute of limitation for claims against a Florida Trustee per F.S. 736.1008(6)(a)1.a.

Here is the good news/bad news I received from my bank today regarding my Paycheck Protection Program (PPP) Application: The good news: your application has been approved; the bad: the SBA is out of money and you must wait for Congress to refund the program!

Although I have heard of a few small businesses that have received funding I am guessing that most persons reading this letter have encountered similar frustrations. Note: if you have received funding, please so reply.

We predicted in my first letter regarding PPP that the $349 billion fund would run out of money and this Thursday it did. It lasted two weeks! For an interesting map on where the funds were distributed nationwide see PPP Loan Allocation Map.

My message to you now is don’t give up. Yes, many small businesses with average monthly payroll over $1 million got preferential treatment by the big banks. However, the banks are incentivized under the SBA program to make small loans under $1 million.

And more encouraging: there is strong bi-partisan pressure to refund the program. (If only Congress could stop the bickering and see the urgency of the threats to millions of small businesses.) Regardless, if you have applied and are waiting to get approval, keep checking with your bank to make sure they have all necessary documentation and try to get confirmation your application has been approved. If you have not applied, do so immediately.

My son-in-law is a senior manager for a major regional bank in the western states and is working over-time this weekend to continue to process applications. My bank advisor also tells me she is working this weekend on her bank’s back-log of applications. Both banks believe the program will be refunded. I think that is a good bet.

The Covid-19 Pandemic has changed the world as we know it and presented daunting challenges we have not encountered in our life time. It requires a total review of your estate plan and business entities to assure you are taking full advantage of Florida laws designed to protect your family and business.

The hard new reality: What plan was best for you prior to 2020 may not be what is best for you today

Take this three minute survey for a quick assessment:

If single: Special 2020 Asset Protection Checklist for Single Professionals

If married: Special 2020 Asset Protection Checklist for Married Professionals Note to All: Two important legal documents for everyone over age 18:

• An up-to-date Florida specific Durable Power of Attorney
• A comprehensive Florida Health Care Surrogate

Special note to all parents with college students and young adults:

We now know that COVID-19 can attack any age. The last people who consider a DPA and Health Care Surrogate mentioned above are young adults. If you are a parent with adult children over age 18, I urge you to convince your sons or daughters to secure these important legal instruments. For a flat fee, we are available to prepare these documents, review the key legal provisions with your adult children, and email them for signing.

We will get through this together, as we did after Pearl Harbor and 9/11, and will be a stronger, more united country. Stay well and stay safe!

DURABLE POWER OF ATTORNEY FROM DON LEWIS TO CAROLE BASKIN dated November 21, 1996

You can always count on the Americans to do the right thing – after they’ve tried everything else. – Winston Churchill.

Millions of small business owners and self-employed have filed for loans under the Paycheck Protection Program because part or all of the loan can be forgiven if you retain your employees and maintain their salary levels.

Okay, we know, as of this writing, millions have applied and few have received!

But assuming SBA gets through this current bottle-neck and the funding starts to flow, then your focus will be on maxing out the amount that can be forgiven.

The SBA will forgive the part of your loan that covers the first eight weeks of payroll, mortgage interest, rent, and utility payments immediately after you receive funding. You must use 75% of the borrowed loan for payroll costs; only 25% can be for mortgage interest, rent, and utilities.

The SBA will not forgive the portion of the loan used for other expenses; this part of the loan will be maintained at a 2 year loan at 1% interest rate. Loan payments are deferred for the first 6 months of the loan although interest will accrue during this time.

So even if part of your loan is not forgiven, the loan terms are exceptionally favorable for you – maybe this explains why many banks have been lying low in the grass and not soliciting applications because they simply do not want to take on a boat-load of low interest rate loans or short term loans that are quickly forgiven.

So here are 5 quick tips for maxing out your loan forgiveness:

1. If possible, do not reduce the number of full time employees during the 8 week period. The SBA will do a Head Count Analysis for this period and reduce the forgivable portion of your loan according to a head count formula.

Note #1: The CARES Act allows the business to remedy the forgiveness amount by June 30, 2020, but it is still unclear how mechanically you do this. Expect further SBA guidance on this point.

2. If possible, do not reduce employee salaries during the 8 week period. The SBA will do a Wage Analysis and reduce the forgivable portion according to their wage analysis formula for any such reduction. But see Note #1 above.
3. Keep the loan funds in a separate bank account and only withdraw to cover eligible expenses.
4. Keep a separate expense account to accumulate all eligible costs.
5. Document all eligible costs.

For a deep dive into the tax benefits for small business under the CARES act I highly recommend for other attorneys and professional advisors the recent webinar by estate tax lawyer, super-guru and friend Alan Gassman: Update On The Paycheck Protection Act Loan Rules.

Here is an updated calculator from Turbotax: Stimulus Check Calculator When Will Checks Arrive?

If you signed up for direct deposit on either your 2018 or 2019 tax return, the IRS reportedly will start issuing electronic deposits on April 9 and they should show up in your bank account by April 14. However, remember, this program is fluid and these target dates are subject to change.

If you receive Social Security Benefits and usually don’t file a tax return, the IRS will use the information from your Social Security benefits statement to calculate the stimulus check amount. They will send the check electronically if that is how you typically receive your Social Security payments.

Note: For persons who don’t file a tax return, the IRS plans to create an on-line portal where you can file a “simple return” to provide your bank account information. This portal should go live within the next few weeks.

If the IRS has to send you a paper check, priority will be given to lower income persons; higher income persons will wait longer to get their checks.

Quick Tip: If you want to try to get your check sooner, then file your 2019 tax return as soon as possible and sign up for direct deposit.

In these challenging times, we are here to help you, your family and small business successfully navigate this massive but temporary storm. We will get through this together! Look for our future alerts.

If you have never checked Florida’s website for lost accounts and abandoned property you should do so – immediately. You may be pleasantly surprised!

You may think that it is not possible that you have any “unclaimed” property held by the State of Florida – and you could be wrong.

The dirty secret is that many banks and life insurance companies will make little effort to find you if you do not notify them of your change of address. They will do the easy thing: transfer your account to the Florida Division of Accounting and Auditing, Bureau of Unclaimed Property. Thousands of such accounts end up in the Florida Unclaimed Property fund each year.

In the past we have had clients find more than $100,000 in old bank accounts that they had forgotten or failed to notify the bank of a change of address.

Special Note: Beware of scammers. There are a number of so called “private investigators” that may call you and tell you they can find lost money owed to you, but first you have to agree to pay them a percentage of the funds. Do not sign anything! They are simply doing what you can do for free by checking the website below.

The holidays are coming. Now may be a good time to see if Florida has any unclaimed property for you or a family member. The search is easy. Click Here: Florida Treasure Hunt.

Good luck!

Phil Rarick

Rarick Trusts & Wills Law, P.A.

Special Note

The information on this blog is of a general nature and is not intended to answer any individual’s legal questions. Do not rely on information presented herein to address your individual legal concerns. If you have a legal question about your individual facts and circumstances, you should consult an experienced Miami asset protection attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

May the odds be with you – but frankly they are not:

• A recent study indicated that the average lawyer can now expect three legal malpractice claims during his or her career.
• The overwhelming majority of legal malpractice claims — over 65% — are brought against firms with five or fewer attorneys.

Our firm concentrates on estate and asset protection planning – helping small business owners protect their business and savings in good times and bad. Although most of our high risk clients inquiring about an asset protection trust are doctors, we are getting more calls from attorneys. For good reason. Our over-all goal is to make you an unattractive target against a hostile creditor. We call it our “Porcupine Strategy”: the goal is to take full advantage of Florida law and laws outside of Florida to make your assets as unattractive to attack as a Porcupine would be to a wolf.

The conventional wisdom to minimize legal malpractice risk is a professional insurance policy. No attorney with a small firm needs to be told how the premiums for these policies have been skyrocketing over the past five years. These high premiums should force you to ask if there are other ways to protect you from personal liability. The first letter you will get will demand disclosure of your insurance limits. Insurance is absolutely necessary as a war chest to defend you, but it runs counter to our Porcupine Strategy because rather than make you a more unattractive target, it makes you an enticing prey.

Asset Protection Analysis: Where To Start

Basic asset protection analysis for Florida attorneys starts with taking a look at your complete bundle of assets and dividing them into two columns: Protected and Exposed. Assets such as your homestead, IRA, 401k, life insurance, pre-Paid Florida Tuition, and 529 plans are well protected by Florida law if acquired before the threat arises.

Note: Creditors have a civil remedy to claw back transfers made “with actual intent to hinder, delay, or defraud any creditor of the debtor.” Florida Uniform Fraudulent Transfer Act, F.S. 726. Therefore, timing of transfers is critical.

Assets that are exposed may be your vacation home, investments in rental real estate (this is the lowest of the low hanging fruit), brokerage account, savings account, and boat.

Multiple Options, But Consider a Nevada Asset Protection Trust

A rigorous asset protection plan often has multiple defensive options. For example, your vacation home or rental properties may need to be transferred to a multi-member Florida LLC with a robust anti-Olmstead operating agreement. However, if you have significant non-qualified investments (investments that are not IRA, 401k, or SEP) you likely should consider a domestic asset protection trust (DAPT). Florida does not have laws favorable to creating a DAPT, but many other states do. Based upon a national analysis and my experience, the top tier states are Nevada, Alaska, Delaware and South Dakota, with Nevada routinely ranking first. See Domestic Asset Protection Chart Rankings by attorney Steve Oshins. For more information see our report: Nevada Asset Protection Trust: Your Best Option? A properly structured Nevada APT can protect your equity investments while still giving you control over distributions and how your money is invested.

Timing

As already noted, Florida has a civil remedy law that allows creditors to claw back transfers if there is a known or threatened creditor. This means that Asset Protection Planning must be done when the waters are quiet – before any threat arises.

Two Big Take-Aways

1. At a bare minimum, do an asset protection analysis of your bundle of investments and assets.  Consider a Domestic Asset Protection Trust as an option for your intangible assets.
2. Don’t wait.  Most attorneys fail to consider asset protection planning until it is too late.  The lesson is clear:  do not put this off.  Everyone is busy, but protecting your business and family comes first.

We are available for consultations; we charge a flat fee of $400 for the initial consultation and often can give you a flat fee for the proposed asset protection structure that we recommend. Let us know if we can help.

Special Note

The information on this blog is of a general nature and is not intended to answer any individual’s legal questions. Do not rely on information presented herein to address your individual legal concerns. If you have a legal question about your individual facts and circumstances, you should consult an experienced Weston estate planning attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

The Message.

Apparently the message has not got out: In 2011, the legislature threw Florida single member LLC’s under the bus. In a compromise with the bank lobbyists called the Olmstead Patch, multi-member Florida LLC’s (or limited liability companies) were given charging order protection, but a Florida single member LLC receive none. This means a Florida single member LLC can be easily attacked because creditors are not limited to a charging order; rather creditors can foreclose on their interests. See F.S. 605.0503. Olmstead V. F.T.C. Also See Olmstead Patch. If you have a Florida single member LLC you essentially have a sand castle fortress unless the single member is a limited partnership or multi-member LLC. Here’s why.

The Problem.The Problem.

In our law practice, we are still seeing small business clients come to us with Florida single member LLC’s because single member LLC’s were exceptionally popular prior to the Olmstead decision for several reasons:

1. Simplicity.   Many persons were under the false impression that to set up an LLC properly you only needed to file a simple two page Articles of Organization.  In fact, the core of every LLC is a robust Operating Agreement that defines ownership interests and rights – and severely limits creditor’s interests and rights.
2. Cost.   There are numerous online services where anyone without a legal education background can set up a LLC quickly and fairly cheap.   Unfortunately, you are not getting what you expect and may be setting yourself up for a blind attack.  You may think you have created a fortress against your creditors – but when the rain falls you find out that your fortress quickly collapses.

Warning:  On line services should warn you of the severe limitations of a Florida single member LLC.  However, I have found none that do.  Use such services at your own risk.

3. No Tax Filing.  A Florida single member LLC can be a disregarded entity and not required to file a tax return.  All income is attributed to the single member and reported on the member’s IRS 1040.

So you can set up a Florida single member LLC  fairly cheap – but if it does not give you charging order protection what good is it?

What Is Charging Order Protection – and Why Is It So Important

The exclusive remedy for creditors against a Florida multi-member LLC is a charging order. A charging order is usually an unattractive remedy for a creditor because it means they cannot foreclose on their interest; they only have a lien. The creditor only has the right to distributions from the LLC. Typically, if you have a well written LLC Operating Agreement, this will mean that the creditor has to wait until the LLC Manager decides to make a distribution. Rather, than make distributions, the Manager may be able to pay reasonable management fees to other owners or family members for bona fide management services.

Note: A well written Operating Agreement is necessary to help ensure that a hostile creditor has no voice in the management of the company; this means the creditor cannot vote, manage, or liquidate the LLC. No LLC should be formed without an Operating Agreement drafted by an experienced Florida business attorney.

The Fix.The Fix.

There is good news.  While Florida law does not provide much (if any) protection for a single member LLC, the law is quite strong for multi-member LLCs.  See Young V. Levy

Here are a couple options for making your Florida LLC a multi-member LLC:

1. If married, you can take a 95% interest as tenants by entirety with your spouse, and 5% interest with one spouse.  Note:  We advise a minimum second interest of 5% but there is no ruling or law defining what interest constitutes minimum interest.
2. If you have children, a second option may be to create an irrevocable grantor trust for the education and support of your children. Such trust could hold a 5-10% interest in the LLC.

These are just two options; there are others that you may wish to discuss with your attorney.  If it is not feasible or cost effective to have a second member, then you may wish to consider a Delaware LLC because Delaware law does provide charging order protection for a single member LLC.

The Take-Aways.

1. Do not rely upon a Florida single member LLC to protect your assets.
2. Make sure you have a multi-member LLC and a strong Operating Agreement.
3. Consider a Delaware LLC if a multi-member LLC is not feasible.

For more information, contact Phil Rarick, Weston Asset Protection attorney, at (305) 709-2858 or prarick@raricklaw.com. Special Note

The information on this blog is of a general nature and is not intended to answer any individual’s legal questions. Do not rely on information presented herein to address your individual legal concerns. If you have a legal question about your individual facts and circumstances, you should consult an experienced Weston Asset Protection attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

It is a simple reality: We live in a hostile legal environment, and the chance you will not face costly litigation at some point in your career is not good. The good news is that you can fight back. Here is a quick summary of our “Porcupine” Asset Protection Strategy with tested legal strategies that can help protect your investments and property.

1. Make Your Assets As Unattractive as Possible to Attack with a Good Asset Protection Strategy

The starting point for most persons interested in helping to ensure that their hard earned investments are well protected is to make an inventory of all assets and, in consultation with an experienced asset protection attorney, divide these assets into “Protected Assets” and “Exposed Assets.” The goal is to take the Exposed Assets and turn them into porcupines, so if the wolf (creditors or future persons who may try to sue you) appears at your doorstep, their reaction will be the reaction porcupines get from their predators: after sniffing around they back off.

Therefore, the key point of the Porcupine Asset Protection Strategy is to turn attractive assets or “low-hanging fruit” into Porcupines with the initial goal to preempt lawsuits.

Note: What is the lowest of the low hanging fruit? Answer: Real estate titled in your name or joint name with your spouse.

Real estate is the ideal asset for creditors, because (1) it does not disappear overnight; (2) creditors can quickly lien it; and (3) creditors can foreclose on it. This is why almost all investment property should be in a multi-member Limited Liability Company (“LLC”) with a post 2012 Operating Agreement or Limited Partnership. See 4 Take-Aways Under Florida’s New LLC Law.

2. Asset Protection Planning is Not Dogmatic

Good asset protection strategy is not dogmatic; by this I mean that it does not apply a one size fits all approach. Sometimes in this field, you will find attorneys who have a hard bias toward off-shore planning; others will have a strong preference for domestic asset protection trusts; while others may say just stay at home and take advantage of your strong Florida laws. What is best for you depends on your unique goals, unique bundle of assets, and risk tolerance.

Good asset protection planning often combines multiple layers of protection with multiple defense options – not unlike Geno Smith, the legendary basketball coach of North Carolina, who employed a successful basketball defense based upon applying multiple defensive schemes. Therefore, it is possible – and commonly used – to employ multiple asset protection techniques: some assets will be protected by Florida law, some assets by a Delaware LLC, other assets by a Nevada Asset Protection trust; if the Nevada Asset Protection Trust is seriously threatened, it can be moved off-shore and established as a Nevis Asset Protection Trust or a Cook Island Asset Protection Trust.

3. Not Based Upon Concealment

Many lay persons believe that they can protect their assets by concealing them from creditors. For example, it may be tempting to transfer an investment real estate property to a family member or friend. Such transfers are likely doomed to failure – and we are assuming your friend or family member does not get sued. The reason is two-fold. First, with modern discovery laws in the United States, a creditor can discover virtually any transfer you have ever made because they can simply depose you and you must tell the truth under penalty of perjury. In addition, there is always a paper trail, in the form of texts, email’s, bank transfers, or tax returns. The second reason concealment does not work is FUFTA, the Florida Uniform Fraudulent Transfer Act, F.S. 726. Under this law, transfers made “with actual intent to hinder, delay, or defraud any creditor of the debtor” may be clawed back. See Point #8,

Note: While concealment should never be a basis for asset protection planning, there may be value in maintaining a low public profile, so that when a creditor performs a Google search your investment entities do not show up. This could be particularly beneficial for any professional in a high-risk profession – such as a doctor, dentist, or health professional.

4. Take Full Advantage of Florida Law

It is often surprising to me that some Florida residents think they need to go to Wyoming or South Dakota to protect their assets when they often have good options under Florida law. Florida has one of the strongest (if not the strongest) homestead laws in the United States. Of course, this is one reason why O.J. Simpson moved to Florida: he purchased an expensive Florida home and claimed it as his primary residence.

For decades, Florida courts have done a superb job of protecting homestead. A good example is the Florida Supreme Court Havoco decision. In this case, Havoco obtained a $15,000 judgment against Hill. Three days before the judgment became enforceable, Hill purchased a $650,000 property claiming to make this property his homestead. Creditors argued this property could not be protected homestead because Hill converted non-exempt assets into the homestead with the intent to defraud his creditors. Despite the obvious intent to defraud the creditors, the court found the homestead was protected. See 790 So. 2nd 1018 (Fla. 2001).

Of course there are limitations to the Florida homestead protection that are beyond the scope of this summary. Florida homestead is a complex and often misunderstood protection where you need to consult with an experienced Florida attorney.

Florida homestead is not the only Florida law that residents should take advantage of. Real estate investors should almost always consider LLC’s – limited liability companies – to protect their real estate and limit creditors to an unattractive remedy called a charging order. The two fundamental take-aways on Florida LLC’s is that they should be multi-member (unless owned by a limited partnership) and they must have a robust LLC Operating Agreement drafted after 2012 because the Florida LLC law was fundamentally changed in 2012. See Basic LLC Checklist.

Other investments protected by Florida law are (1) IRA & qualified plan benefits; (2) wage exemption; (3) wage accounts (but only for 6 months); (4) life insurance, both term and cash value provided the policy is owned by the insured; (5) annuities; (6) Florida Pre-Paid Plans; (7) 529 college plans. Note: this is not a complete list.

5. Domestic Asset Protection Trust – That Can Be Moved Off-Shore – As A Core Planning Tool

Most persons considering the best way to protect their cash, stocks and other equities likely need a Domestic Asset Protection Trust (“DAPT”). This is where Florida residents usually need to consider another state jurisdiction because Florida does not protect “self-settled” trusts: a trust where the grantor is also the beneficiary. However, Nevada, Delaware, Alaska and other states do have strong legislation protecting self-settled trusts.

Nevada has modern laws designed for robust DAPT’s. The 5 major advantages of a Nevada DAPT are: (1) no state income tax; (2) 2 year statute of limitations for future creditors; (3) 2 year statute of limitations or 6 months from date of discovery for pre-existing creditors; (4) No pre-existing torts exception creditors; (5) allows self-settled trusts. For a more complete discussion of such trusts, and specifically the Hybrid Nevada DAPT, see my article Nevada Asset Protection Trusts: Your Best Option?

6. Asset Protection Plan integrated with Estate Plan

Prior to the new federal tax law, the Tax Cut and Jobs Act of 2017, much asset protection planning could have a sound estate tax avoidance rationale. Now, with the estate tax exemption of $5.6 million in 2026 (the current exemption is $11.2 million, but this is temporary and drops down to $5.6 million in 2026) such a rational is not realistic for many persons. However, there are often fundamentally sound estate planning reasons to do such planning because a good asset protection plan should usually be integrated with your estate plan. Usually the goals are not just to protect your assets now and for the rest of your life, but also to protect them for your children and grandchildren. No one wants to spend your life working to build a valuable nest-egg, only to see a big piece of this nest-egg lost in your child’s divorce case. Further, the core component of most estate plans is a revocable living trust; such a trust must be integrated with all domestic corporate entities and other trusts. The take-away here is that you should not do asset protection planning without connecting and integrating it with your estate plan. If challenged, you have a legal basis to claim that transfers made were done as part of your over-all estate planning, and not attempts to “to hinder, delay, or defraud any creditor”.

7. Insurance As War Chest – Not An Incentive For Lawsuit

Insurance – such as malpractice insurance for the professional or casualty insurance for the real estate investor – is a critical component of a comprehensive asset protection plan. However, in determining how much insurance you need consider that a primary purpose of your insurance should be to give you a war chest to defend a legal attack. More commonly, insurance is an incentive to a lawsuit. The first request you will get from a personal injury for a person injured at your business is a demand letter for disclosure of all insurance that you have on the property. You are required to disclose this information under Florida law. If the damages are substantial, the PI attorney will want to go beyond the policy limits and sue you personally. Insurance – not coupled with an asset protection plan – is a big incentive for a lawsuit; it is the equivalent of putting a bulls-eye target on your assets. Under our Porcupine Asset Protection Strategy we want to minimize any such incentive. Therefore, the two big take-aways here are: First, have adequate insurance to fund a war chest to vigorously defend a lawsuit. Second, do not rely simply on insurance – take advantage of Florida law and other laws to protect these assets with a good asset protection plan. In the long run, such a plan is far cheaper than paying for large insurance policies.

8. Timing Is Critical

Timing is one of the most critical considerations in asset protection planning. Asset protection planning is usually not viable after:

• Parent of 18 year old driver who seriously injures a young biker
• Owner of rental real estate where late night party results in a fight and guest getting stabbed;
• The doctor who is served with a summons after a botched surgery;
• Pre-divorce planning by a husband trying to scam his wife (or wife trying to scam her husband. (Here there is a good pre-marriage legal solution: it is called a Prenuptial Agreement.)
• Owner of house where worker pressure cleaning the roof falls off and breaks back.

In such situations it may be too late to do any planning. The reason is FUFTA: Florida Uniform Fraudulent Transfer Act, F.S. 726. This is a powerful creditor civil remedy (not a criminal remedy) that allows a creditor to claw back any transfer made “with actual intent to hinder, delay, or defraud any creditor of the debtor”. Creditors may rely upon the “badges of fraud,” such as making transfers to an asset protection entity that renders the creditor insolvent.

The take-away on this is simple: Plan when waters are quiet – before the problem arises. Do not put this planning off to another time; do it now.

Conclusion

Asset Protection Planning covers a wide breadth of law; it requires an experienced attorney who concentrates in such planning. For more information contact Rarick Trusts & Wills Law at info@raricklaw.com or call (305) 709-2858.

One of the most common questions I get as a Weston estate planning attorney is, do I need to record my living trust? Some persons believe that a trust needs to be publicly recorded like a corporation or a deed. This is generally wrong; not only is recording not required or needed for most trusts, in most cases recording would negate one of the chief benefits of a trust: confidentiality. Let’s look at more specific questions.

Does a Living Revocable Trust Need To Be Recorded During the Life of the Trustmaker?

The short answer is no. One of the great benefits of a living trust in this era of Google – where is it difficult to keep anything private and out of the public domain – is that a living trust is confidential. It does not need to be recorded, filed, or registered except in certain circumstances I will discuss below. A living trust, properly drafted by an experienced Weston estate planning attorney is a powerful legal instrument to protect the privacy of your personal and financial information.

Does a Living Revocable Trust Need To Be Recorded Upon Death of the Trustmaker?

No. Unlike a Will that does need to be filed with the Clerk of Court within 10 days of death, a trust can allow you to keep personal financial information out of probate. Probate is the legal and very public process many families must go through upon death of a family member. A properly “funded” living trust does not need to go through a public probate process.

Note: Funding of your trust is transferring all major assets to your trust by changing title or beneficiary designation. For example, the primary beneficiary of your life insurance should usually be your living trust. We advise reviewing the funding of your trust at least every three years with a Weston Estate Planning Attorney.

What Are the Exceptions?

The most common exception are real estate truncations, and even in such cases, it is not necessary to record the entire trust. Sometimes in real estate transactions it is necessary to file a Certification of Trust, but this Certification will not contain any personal or financial information about the trust. A Certification of Trust may be required by a title company or bank to prove that the trust exists, the names of the trustees, and that the trustees have powers under the trust to transfer the real estate or secure financing. The Certification of Trust is often a short, 1-3 page document summarizing these key elements.

Take Away Point: Avoid Snooping, Meddling Persons

One of the great benefits of a living revocable trust is that it is private and confidential – it does not need to become a public record; it does not need to be recorded, registered or filed. This is just one reason why a living trust has become the preferred planning legal instrument for most persons. The alternative, a Last Will and Testament, must be deposited with the court and usually must go through a public legal process called probate. Properly funded, a living trust will avoid probate and keep your personal and financial information off of public records and away from snooping persons that may wish to meddle in your affairs.

For investors, business executives and skilled workers, there are several excellent immigration programs available that can help you to live and work in the United States –in most cases you will also be able to bring your immediate family members.

The three programs that give applicants the most bang for their buck are:

The L-1A Visa for Executives and Mangers http://www.asylum-abuse-immigration-lawyer.com/employers/managers-executives/

Using the L-1A visa process, a foreign company can transfer a qualified executive or manager to an existing or a newly created subsidiary in the United States.

To qualify, the applicant must:

• Have been working for a qualifying organization abroad for one continuous year within the three years immediately preceding his or her admission to the United States and

• Be seeking to enter the United States to provide service in an executive or managerial capacity

Qualified employees entering the United States to establish a new office will be allowed a maximum initial stay of one year. All other qualified employees will be allowed a maximum initial stay of three years. Extensions of stay may be granted in increments of up to an additional two years, until the employee has reached the maximum limit of seven years.

The L-1A is an excellent choice for managers or executives of an established foreign company which intends to start or develop a company in the United States.

The E-2 Visa for Investors http://www.asylum-abuse-immigration-lawyer.com/individuals/investors-business-owners/

For those from treaty countries with money to invest in a US business, the E-2 program is an attractive option. Depending on the industry, investments can be as low as $100,000.

To qualify for E-2 classification, the investor must: • Be a national of a country with which the United States maintains a treaty of commerce and navigation • Have invested, or be actively in the process of investing, a substantial amount of capital in a bona fide enterprise in the United States • Have at least 50% ownership of the enterprise or possession of operational control through a managerial position or other corporate device.

While visas do not grant permission to remain in the United States indefinitely, qualified E-2 investors and eligible employees can apply for unlimited 2-year extensions. Their spouses are also eligible for work permits and their children can attend college.

The H-1B Visa for Specialized Workers http://www.asylum-abuse-immigration-lawyer.com/individuals/visas/

The H-1B visa program is used by U.S. businesses to employ foreign workers in occupations that require highly specialized knowledge. It is commonly used for employees in STEM occupations (Science, Technology, Engineering and Math) such as engineers or computer programmers.

Although the H-1B program is subject to congressionally mandated caps, it is still an excellent choice for business owners who cannot find the US-based talent that they need to maintain business operations.

It is also an option for a foreigner with a bachelor’s degree who wishes to start a company in the United States.

The help of competent advisors will ensure that your immigration goals are successful while also mitigating tax, financial and estate impacts.

For expert advice on which program may be right for you or your foreign clients, visit Blandon Law. http://www.asylum-abuse-immigration-lawyer.com/request-consultation/ NOTE: Elizabeth Blandon is the founder of Blandon Law, a Weston-based firm specializing in immigration, naturalization and consular law matters for foreign nationals worldwide. She is Board-Certified in Immigration Law and has been practicing immigration law for 20 years. Currently Ms. Blandon serves as Chairperson of the Immigration Section of the Broward County Bar Association and as Vice Chair of the Nationality & Law Certification Committee for the Florida Bar.