By Phillip B. Rarick, Miami Trust Attorney, and Hannah S. Rarick, J.D. Candidate

Effective as of last year July 1, 2021, Florida is now 1 of 15 states to enact the Uniform Directed Trust Act (FUDTA), F.S. §§736.1401 to .1416, that allows a third party other than the Trustee to take over some part of the trust administration – such as supervision of a small family business. This third party is called a Trust Director (or directing Trustee) in the new statute; but is also commonly referred to as a Trust Advisor under prior law or Trust Protector in other jurisdictions.

Here are Five key points in the new Directed Trust Act: 1. Expanded Trustee Protections. The focus of the new act is to expand the guidelines and protections for Trustees who are “directed” to take or not take certain actions during the trust administration. F.S. 736.1409. The person who can give such directions is now referred to as either (a) Trust Director (F.S. §736.1406) or (b) a “directing Trustee” (F.S. §736.1412).

Note: I am going to use “Trust Director” as I find “directing Trustee” confusing. The act anticipates that the Trustee will not

also serve as Trust Director otherwise why then do you need a Trust Director? However, the new law does not prohibit a Trustee from also serving as a Trust Director.

2. Powers of the Trust Director. These powers are very broad and include power over investment, management, distribution of trust property, amend trust, and terminate Trust. Powers that are excluded include powers of appointment and the powers to remove a Trustee or Trust director.

3. Clarification of Trust Director Standard of Care. Before FUDTA, it was not clearly defined what fiduciary duty was imposed on the Director. Now, the new law states the Trust Director’s minimum duty is to act in good faith and in accordance with the beneficiaries’ interest, which is parallel to a Trustee. This duty is applicable to any person who holds the role of directing a trustee, despite the title of the position.

4. Trust Director Can Now Issue a 6-month limitation notice. A 6-month limitation notice can now be issued by both the Trustee and Trust Director. A Trust Director can issue 6-month limitations notice per F.S. 736.1008 that can effectively cut off claims by a beneficiary of the acts of the Trust Director unless an action for breach of trust based on matters disclosed in a trust accounting or other written report is commenced within 6 months after receipt from the trustee or a trust director of the limitation notice.

5. Effective date: July 1, 2021. But here is the curve ball. The new law is currently effective, although F.S. §736.1403 provides “(a) If the trust was created before July 1, 2021, this part applies only to a decision or action occurring on or after July 1, 2021.”

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 Trust 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.

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

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.

Florida’s 30% elective share law was completely rewritten in 2001 because the old law could be easily circumvented by placing assets in a revocable trust or using non-probate transfers (e.g. life insurance, IRAs etc.) In an effort to curtail such tactics, the legislature overhauled the statute and broadened the share. The result is an expansive elective share that sweeps into the decedent’s “elective estate” many non-probate assets. See F.S. §732.201 —§732.2155.

What Is Included? Florida’s elective share statute retains the 30% share under prior law, but introduces the concept of the “elective estate” (sometimes referred to as “augmented estate”) that consists of the following property interests under F.S. §732.2035:

• Decedent’s probate estate;
• Decedent’s fractional interest in property held by the decedent in joint tenancy with rights of survivorship or tenancy by the entireties;
• Property in a revocable trust or a discretionary trust for the decedent’s benefit;
• Cash surrender value of insurance policies on the decedent’s life;
• Death benefits payable under retirement plans;
• Certain transfers within a year of the decedent’s death;
• Transfers in satisfaction of the elective share;
• “Pay on Death” or “POD”; “Transfer on Death” or “TOD”; and “In Trust For” or “I/T/F”; and co-ownership with rights of survivorship accounts. The decedent’s interest is that portion that the decedent could withdraw immediately before death without an obligation to any person. If Tenancy by the Entireties, one-half is included.

This is not a complete list; see F.S. §732.2035. What is Excluded?

Not much. Here are some of the major exclusions:

• Real property that constitutes the decedent’s homestead;
• Insurance in excess of the cash surrender value is generally excluded;
• Gifts that qualify for the gift tax annual exclusion; and
• Transfers with the written consent of the spouse. (Spousal consent to gift split is not written consent.)

Again, this is not a complete list; see F.S. §732.2045.

Deadline for Making Elective Share Election

The general rule is that the election must be made within the earlier of six months of the date of service of the Notice of Administration or two years from the date of death. F.S. 732.2135.

Rarick Trusts & Wills Law has been trusted by numerous law firms and many families during the past 20 years for probate, estate planning, trust and asset protection cases. To schedule an appointment with Phil Rarick, a Miami probate attorney, call (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 in Miami probate attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

Hard to believe we are in mid-Fall and 2016 is coming to a close. Now may be a good time to sit down with a Miami trust attorney and review your estate plan. One of the biggest problems we see with individual estate plans is failure to keep the plan updated to ensure that it continues to meet the changing needs of your dynamic family. Here is a short checklist:

1. Marriage/Divorce.Has there been a marriage, divorce, or separation of anyone named in your will or trust – such as your adult children or grandchildren? Most persons want to ensure that their hard earned money goes to their children – or grandchildren – not to any spouses.

2. New Births Of Children/Grandchildren. Has there been a birth or adoption of a child or grandchild? First, if so, congratulations! Second, this child may need to be added as a beneficiary of your will or trust with detailed instructions to make sure all funds are wisely spent first for education or health needs.

3. Discord in Family. Unfortunately, we have seen too many cases where family warfare breaks out among the children where the father, mother, or both are no longer around to maintain peace. To avoid such disharmony, it is important to have clear instructions in your living trust and a strong, independent successor trustee with good peace making skills. If this is a concern, have you addressed it in your trust prepared by a Miami trust attorney?

4. Disability of beneficiary. Have any of the persons you have named as a beneficiary suffered any type of mental or physical disability? If so, it may be necessary to modify your instructions to make sure any funds designated for this beneficiary are used in the most effective way possible. For example, if a beneficiary may be entitled to receive SSI or other government benefits, this beneficiary may need a Special Needs Trust.

5. Poor Money Managers in the Family. Are any children not good money managers?Do you need to amend your trust instructions to make sure these funds are protected and cannot be grabbed by their creditors?

6. Successor Trustee.This is the person you have appointed to step into your legal shoes if you become incapacitated – in other words, one of the most important decisions you can make. Who have you appointed to take charge if you are incapacitated? What is the order of succession of trustees?

7. Year End Gifts. This year, any person can give $14,000 to any person – child, grandchild, or friend – tax free. This gift must be made prior to December 31. Such gifts require no reporting to the IRS, but gifts in excess of $14,000 do. Remember: you never want to make such a gift outright to a minor child because they may blow it when they turn 18. Better to make the gift to an Educational Trust for the benefit of the minor child.

As Miami trust attorneys, we endeavor to help keep your estate plans up to date with the changing needs of your family. We are available to meet through December 16. Please call Christy at (305) 709-2858 or email to cmedina@raricklaw.com to schedule an appointment. Have an enjoyable November!

Note: Your revocable living trust is designed to be as dynamic as your family. It serves as the master set of instructions to care for you and your family. Therefore, when there are big changes in your family, you may need an experienced Miami trust attorney to amend your revocable trust.

______#1. Marriage/Divorce. Has there been a marriage, divorce, or separation of anyone named in your will or trust? If there has been a marriage of an adult child (without a prenuptial agreement) you may need to amend your revocable trust to make sure monies designated for this adult child are protected.

______#2. New Births Of Children/Grandchildren. Has there been a birth or adoption of a child or grandchild? This child or grandchild may need to be added as a beneficiary.

______#3. Discord in Family. Is there a potential for disharmony to break out in the family if you are disabled or no longer around to maintain peace? In such a case you need to amend your revocable trust to ensure you have a strong, independent successor trustee with good peace making skills.

______#4. Disability of beneficiary. Have any of the persons you have named as a beneficiary suffered any type of mental or physical disability? If so it may be necessary to modify your instructions to make sure any funds designated for this beneficiary are used in the most effective and prudent way possible. For example, if a beneficiary may be entitled to receive SSI or other government benefits, this beneficiary may need a Special Needs Trust.

______#5. Poor Money Managers in the Family. Are any children not good money managers, or if married, have marital issues with their spouses? Do you need to amend your trust instructions to make sure these funds are protected and cannot be grabbed by their creditors – or an unhappy spouse? As Miami trust attorneys, Let us know if we can help amend your trust.

______#6. Successor Trustee. This is the person you have appointed to step into your legal shoes if you become incapacitated – in other words, one of the most important estate planning decisions you can make. Who have you appointed to take charge if you are incapacitated? What is the order of succession of trustees? If you have any question whatsoever about your order of succession, please call the office at (305) 709-2858.

______#7. 2013 Estate Tax Planning Check. The American Taxpayer Relief Act (ATRA) fundamentally changed estate tax planning beginning in 2013. For 2016 the new law increases the estate tax exemption to $5.45 million per person. If you have a credit shelter trust prepared prior to 2013, it should be reviewed now. If you are not sure of the type of trust you have, call the firm at (305) 709-2858.

______#8. Trust Funding. Funding is simply the transfer of your assets into your trust. If our firm drafted your trust, immediately after you signed your trust, we reviewed how your assets are titled and gave you detailed Funding Notes. Have you followed up on these instructions? It is a good idea to annually review the funding of your trust. It is also advisable to annually sign a new assignment of assets into your trust that will help sweep into the trust assets owned on the date of the transfer.

______#9. Life Insurance. When is the last time you checked (a) the owner of your life insurance policies; and (b) the beneficiary designations for those policies? Typically, you want your living trust to be the beneficiary of your life insurance policy because the trust provides the detailed instructions to help ensure the money is prudently used.

Big Note: Some life insurance should be owned by an irrevocable life insurance trust to avoid the estate tax.

______#10. Estate Plan Review. Has it been more than three years since we sat down and reviewed your estate plan? If so, we recommend that you schedule a meeting as soon as convenient to assess whether your plan continues to meet all the needs of your family. This list contains some of the frequent life changes and should not be a substitute to a consultation.

APPOINTMENT:

To schedule an appointment to review or amend your revocable trust or the funding of your trust, call Rarick Trusts & Wills Law, experienced Miami trust attorneys, at (305) 709-2858 or email Christy at cmedina@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 trust attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

You are named the successor trustee and the trustmaker has just died. No doubt these are difficult times, but thankfully there are many resources to help. The following is a checklist of initial important tasks to help guide you after the funeral or memorial service.

Note: You are not required to accept the trustee duties. However, if you begin to act as successor trustee you will likely be held responsible for all acts as the trustee to the beneficiaries and the IRS. Therefore, do not begin to take any actions as Trustee before you know what your duties are. Consult a Miami trust attorney and see our 12 Point Summary of Florida Successor Trustee Duties.

First Priority Action Items

____ 1. Take possession of all legal records including:

__ Original trust

__ Original will (usually called a pour-over will if decedent had trust)

____ 2. Take possession of all financial records such as:

__ Inventory of assets Note: This may be on paper or on decedent’s computer.

__ Passwords to computer, internet media, or social media

__ Checkbooks

__ Credit cards

__ Statements from all banks or financial companies

____ 3. Take possession of all keys or codes to:

__ All vehicles or boats

__ Safe or bank safe deposit box Note: Do not allow entry to Safe Deposit Box without a witness and prior discussion of arrangements with a Miami trust attorney.

__ House and other real estate or rental properties

__ Storage room

____ 4. Lock and secure all real estate and household contents Click here for the complete checklist: Florida Successor Trustee Checklist.

This is a short list of initial tasks for a person who accepts the duties as Successor Trustee. It is not a complete list of tasks. The trustee will only be able to determine all tasks after carefully reviewing all trust instructions with a Miami trust attorney. Attorneys at Rarick Trusts & Wills Law have helped many family members navigate these tasks as the Trustee or Co-Trustee. We are available to help you. Contact us at (305) 709-2858 or email to 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 attorney that is experienced in Florida probate 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.

____ 2. Original Will and all codicils (or amendments to the Will)

Note: If you have the original, either personally deliver to the attorney’s office or send via Federal Express or certified mail.

____ 3. Originals of all trusts and any amendments or restatements

____ 4. Copy of paid funeral bill

____ 5. Copies of all deeds for real property owned by decedent

Note: If you cannot locate the deeds, we can usually secure if you provide us with the address of the property.

____ 6. Tangible Personal Property Memorandum or writing indicating instructions for distribution of tangible personal property (such as jewelry, furniture, cars)

____ 7. Income tax returns for last 3 years

____ 8. Copies of all bank statements, brokerage account statements, or reports from investment advisors

____ 9. Copies of all life insurance policies

____ 10. All corporate records if decedent owned any corporations, limited liability companies, partnerships or other entities.

Note #1: For a Checklist of Initial Tasks for the Personal Representative (or Executor) tasks click here: Personal Representative Checklist. For a Checklist of Initial Task for the Successor Trustee, click here: Successor Trustee Checklist.

Note #2: If any documents are located in a safe deposit box, you should not enter the safe deposit box without first clearing that with a Miami Probate or Trust attorney.

This is a short list of initial documents usually needed for a Florida probate or trust administration. After your initial consultation with a Miami probate or trust attorney, you will likely be requested to secure other documents.

Questions? If you have any questions contact a Miami probate attorney at Rarick Trusts & Wills Law, P.A. at (305) 709-2858 or 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 probate attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

1. Show Loyalty To All Trust Beneficiaries. Even if the successor trustee is himself a beneficiary, as trustee he has the duty of loyalty to all the other beneficiaries, including the remaindermen. Remaindermen are beneficiaries who do not have a current interest in the trust income or principal, but have a future interest in the trust.
2. Deal Impartially With Beneficiaries. The successor trustee cannot favor the income beneficiaries over the interests of the remainder beneficiaries unless the trust specifically directs otherwise. Typically, the trustee must walk a fine line that balances the interests of the income beneficiaries against the interests of the remaindermen.
3. Make Trust Property Productive Of Income. The trust portfolio of assets is expected to achieve conservative growth. Therefore, this duty may be violated if the successor trustee keeps large amounts in a checking account that does not pay interest and does not grow in value. This duty can also be violated if the trustee keeps trust assets in land that does not produce income, such as vacant land or commercial land that does not produce rental income in excess of maintenance costs.

Remember: The sole reason for the trust to exist is to serve the beneficiaries. It is not an employment program for the trustee. If you are administering a trust that has or acquires unproductive assets, consult with us and we can advise you as to your options.

4. Follow the Prudent Investor Rule, F.S. §518.11. This rule generally means that the trust portfolio should be broadly diversified and invested in conservative investments designed to stay ahead of inflation but not in aggressive growth. As a Trustee, you are not expected to be Warren Buffet, but you better not lose money or you will need to account to the beneficiaries. Often, it is best to retain the services of a Certified Financial Planner (CFP) experienced in helping manage conservative portfolios. Note: The successor trustee is obligated to exercise reasonable care, judgment and caution in selecting an investment agent.
5. Account To Beneficiaries And Keep Beneficiaries Informed. Upon commencement of the trust administration, the successor trustee must inform all income and remainder beneficiaries of his or her acceptance of the trustee duties. If a beneficiary requests it, the successor trustee is required to provide that beneficiary with a complete copy of the trust document, including any amendments as well as relevant information about the assets of the trust and the particulars relating to administration. In addition, even without request, all beneficiaries must be provided with an annual statement of the accounts of the trust pursuant to F.S. 736.0813.
6. Keep Trust Assets Separate. The successor trustee must keep the assets of each trust separate and keep his personal assets separate from the trust assets. This requires separate bank accounts, brokerage accounts, and safe deposit boxes for trust assets. It is particularly important that you keep the assets of the Credit Shelter Trust (also known as the AB Trust, Marital and Family Trust, or Bypass Trust) separate from all other assets, since these assets will pass tax-free at the death of the income beneficiary. If the successor trustee comingles any other assets in with these assets (or even simply takes the assets out of the trust and mixes them with her personal assets), in addition to breaching fiduciary obligations, the successor trustee will have subjected these assets to taxation when she dies, whereas they would not have been subjected to tax otherwise.
7. Avoid Conflicts Of Interest And Self-Dealing. The successor trustee cannot buy assets from the trust or sell his personal assets to the trust. He cannot favor himself as a beneficiary at the expense of any other remainder or potential remainder beneficiary. He cannot make any distribution to anyone or any withdrawals from the trust unless specifically authorized by the trust to do so. The trustee is entitled to a reasonable compensation for trust services or compensation as otherwise set forth in the trust. However, the successor trustee cannot otherwise profit or benefit from the trust unless also a beneficiary. Conflicts of interest and self-dealing is a broad area with many traps. If you are a trustee and have any concern as to any specific action or situation, consult with a Miami trust attorney.
8. Preserve The Trust Assets And Uphold The Trust. The successor trustee is liable if trust assets are lost, misplaced or destroyed because of inattention or negligence. If the trust assets are equities, the trustee needs to monitor their performance. If the trust assets are commercial real estate, the trustee must monitor that the properties maintain a high occupancy level, rents are collected in a timely fashion, and of course deposited in a trust account. This may require hiring a property manager. The successor trustee should be certain that all trust assets are appropriately insured. For example, if the trust owns a house in south Florida, it is imperative that the home be insured for property and wind damage that may be caused by hurricanes, heavy rains, and the weather related events we experience here. If the house is vacant, there should be a security system for obvious reasons.
9. File Tax Returns And Pay Any Tax Due. Each trust has a tax year, which like the personal tax year, ends annually on December 31. The trust must have a taxpayer identification number and file a tax return no later than April 15 of the year following. The income tax return for the trust is Form 1041, the Fiduciary Income Tax Return. The best advice here is to use a professional CPA who routinely prepares 1041’s. As mentioned above, such an expense is a typical cost paid by the trust.
10. Minimize Income Taxes. Income generally includes interest earned on bank accounts, CDs, bonds or mortgages, and dividends on stocks and mutual funds as well as all rental income. The trust has a high tax environment: income not distributed may be taxed at 39.6%. Therefore to minimize income taxes, the trustee may need to distribute income out to the income beneficiaries if the trust terms so allow.
11. Pay Trust Expenses. The administration of the trust necessarily requires certain expenditures. Example of expenses include insurance, real estate taxes, CPA fees, and legal services.
12. Good Record Keeping. The trustee needs to keep accurate records of every dime that comes into the trust and every dime that goes out. For small trusts, we recommend using Quickbooks or Quicken. If the successor trustee does not know these programs, it is highly advisable to hire a professional bookkeeper. If the successor trustee becomes disabled or dies, another person must be able to seamlessly step into her shoes and understand the current status of trust matters.

Note: Before the trust is terminated or before the trustee can be released, the trustee will need to provide a detailed accounting to all beneficiaries for all expenses, income and distributions during the time the trustee served.

EXPERIENCE MATTERS

Miami trust attorneys at Rarick Trusts & Wills Law, P.A., have assisted families and business persons for over 20 years. Our firm has worked with over 400 similar law firms located in states outside of Florida to represent their clients in legal matters concerning trust administration and probate. To schedule a meeting with a Miami trust attorney call (305) 709-2858, or e-mail info@raricklaw.com. We look forward to meeting you!

A Living Will is not a will and it is not a living trust. It is simply detailed, legally binding instructions to your physician that you do not want to be maintained in a persistent vegetative state if there is zero possibility of recovery.

The term “living will” is confusing because it is not a will. A better name is Declaration Regarding Life Prolong Procedures. Such a Declaration is important to most persons because, at the end of life, they do not want to maintained in a vegetative state if there is absolutely no possibility of recovery.

A living will is not a living trust. Although sounding similar, these critical legal instruments are completely different. A living trust is a fundamental estate planning legal tool. It provides a plan to care for you in the event of mental incapacity, and it can be a complete substitute for a will by detailing your instructions upon death for giving your hard earned property to whom you want and when you want.

A good living will is a crystal clear statement and instructions to your physician that life prolonging procedures are to be discontinued if the person is in a terminal condition, or end state condition, or persistent vegetative state, and if the attending or treating physician and another consulting physician have determined that there is no reasonable medical probability of recovery from such condition.

Note: No one person can make the decision to discontinue life prolonging procedures. Florida law requires at least two physicians and most Declarations require the concurrence of your health care surrogate. You may appoint more than one health surrogate.

A good Declaration (or Living Will) has a strong statement instructing that everything is to be done to minimize pain. The Declaration should contain a statement that administration of pain-relieving drugs, and surgical and medical procedures, as well as unconventional pain-relief therapies are to be used. This means that your health care surrogate is not constrained by a bureaucratic decision of the Food and Drug Administration when it comes to administering pain relief therapies. Rather, you are placing your trust in the judgment of your spouse, family member or friend whom you have appointed to be your health care surrogate.

Conclusion

Although not a will or a living trust, a “living will” is a Declaration Regarding Life Prolonging Procedures. It is a critical legal instrument that should clearly reflect your wishes in the event you are in a persistent vegetative state and there is not possibility of recovery. Some persons are concerned that even with such a signed Declaration the physician may not respect your wishes. This is why it is important to have the Declaration drafted by an experienced Miami estate planning attorney. Properly drafted and executed, the physician has no choice but to follow your wishes. For more information, contact Phil Rarick, Miami trust attorney, at (305) 709-2858 or 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 trust attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

A living trust is simply detailed, legally binding instructions to care for you and your family. There are three key players in a trust. First, the Trustmaker or grantor; this is the person who makes the trust. Second, the Trustee, whose job is to follow the instructions of the trust exactly and to the spirit of the trust. The third role are the Beneficiaries. The Trustee’s fiduciary duties run like a laser beam to the beneficiaries: every penny of the Trust must be used in the best interests of the beneficiaries.

Initially, you can act in all three roles in your living trust: You can be the trustmaker, trustee and beneficiary. Your spouse, children, or other loved ones can also be beneficiaries.

Your living trust is revocable – you can change your trust instructions anytime you wish. There is only one person in the world who can change your instructions: you. In the event of your temporary or permanent mental incapacity, or upon death, the trust locks in and becomes irrevocable so that no one else can change it.

Note: To achieve the objectives noted here, your trust must be properly drafted by an experienced Miami trust attorney and funded by transferring your assets to the trust. Funding of the trust is essential to achieving the trust purpose. Your key assets must be titled in the name of the trust or flow into the trust because the trust is the beneficiary of your account. If you have a living trust, and you have not reviewed the trust funding within the past several years with your attorney, it is likely time to do so.

For more detailed information see our paper: Understanding Living Trusts For Florida Residents. Take-Away Points

1. Every person, whether you have $100,000 or $1 million, should likely have a living trust rather than a will. A will must usually go through the costly, bureaucratic court system known as probate. A trust, properly funded, can avoid probate.

2. A living trust is important to keep legal control in the family – and avoid court intervention in the form of guardianship or probate.

3. A living trust provides detailed instructions to help insure that your hard earned money goes to your children or other loved ones – and not to their spouses, or creditors. Just as important, your trust instructions can help insure that your children receive a first-rate college education to help them compete in our new global economy.

• The completed application for the certificate of title;
  • This can be found on the Florida Department of Highway Safety and Motor Vehicles (FLHSMV) website
• The certificate of title or other satisfactory proof of ownership or possession;
• An affidavit that the estate is not indebted; and
• An affidavit that the surviving spouse, if any, and the heirs, if any, have agreed on how the estate assets will be divided

D. Testate If the deceased person died testate, (with a Last Will), the application should be made by the personal representative of the estate and must include:

• The completed application for the certificate of title
  • As mentioned above, the form can be found on the FLHSMV website
  • The certificate of title or other satisfactory proof of ownership or possession;
  • If the will is being probated, a certified copy of the will and an affidavit that the estate is not indebted; or
  • If the will is not being probated, a sworn copy of the will and an affidavit that the estate is not indebted.

E. Important Note Probate may only be avoided if the estate is not indebted. If the deceased person had any debts, the creditor claims must first be resolved either by the formal administration of the estate or by the payment of the claims outside the probate proceeding. Conclusion

Assets such as motor vehicles should be transferred to the appropriate recipients as soon as possible after a person passes away according to Florida law. These items generally depreciate in value as time goes on and may be a source of potential liability to the estate.

For more information contact Rarick Trusts & Wills Law at (305) 709-2858 or email to 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 probate attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.

Nota Especial

La información en este blog es de carácter general y no esta supuesto contestar preguntas jurídicas para un individual. No confía en la información presentada en este documento para sus problemas individuales legales. Si usted tiene una pregunta legal sobre los hechos y circunstancias individuales, debe consultar a un abogado experto en fideicomiso. La recepción de la información de este sitio web o en este blog no crea una relación de abogado con el cliente y los privilegios inherentes en ellos.

____ Lock and secure all real estate and household contents: Keep insured

____ Take possession of all records

____ Do not allow entry to Safe Deposit Box without witnesses and prior discussion of arrangements with attorney

____ Engage attorney

____ Engage accountant

____ Locate original will and deliver to attorney

____ Complete Master Information List

____ Collect documents on Estate Document List

____ Cancel utilities, subscriptions

____ Advise Post office to forward mail

____ Contact homeowner’s insurance and keep insurance current

____ Inventory Safe Deposit Box

____ Search records for potential creditors

____ Advise secured creditors to keep current

____ Open Estate Bank Account

____ Set up Quicken Account

____ Order Appraisal

____ Determine if any Employee Benefits

____ Contact health care providers, such as doctors, hospitals, clinics and determine if they have accepted Medicare assignment for their services. If they have, then they have agreed to accept Medicare and any other insurance payments for their services. Therefore there should be no reason for them to file a claim in the estate for any unpaid portion of their statement. If we have a list of the Medicare providers, we will prepare objections to any claims they file against the estate.

____ Social Security: If the decedent was receiving Social Security, contact (a) the Social Security Administration to inform them of the decedent’s death; (b) the bank where the social security check is being deposited directly into to inform them of the decedent’s death. The Social Security checks are issued a the first of the month and they are in payment for the previous month. The decedent must have lived the entire month to be entitled to the Social Security check. For example, if the decedent died August 15, and the Social Security check was automatically deposited on September 3, the decedent is not entitled to the September 3 check or any checks thereafter. You must contact the bank and request that they return the check to Social Security. Often the bank does this automatically as a service to customers. If the check is not returned, the Social Security Administration will take steps to collect the check(s).

____ Make a claim for Social Security death benefit if (a) decedent has enough hours worked during his or her lifetime; and is (b) survived by a spouse or dependent child. For additional information contact Social Security at 800-772-1213.

____ Determine if Fraternal lodge union or other benefits

____ Determine if veteran benefits

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 attorney that is experienced in Florida probate law. Your receipt of information from this website, blog, or Miami probate attorney does not create an attorney-client relationship and the legal privileges inherent therein.

• The value of the decedent’s estate (exclusive of exempt property) does not exceed $75,000; or
• The decedent has been dead for more than two years, regardless of the size of the estate.

Attorney’s fees for Summary Administration are typically charged at an hourly rate by a Miami probate attorney. In our firm, after reviewing the will (if there is one), inventory, and death certificate, we can give you a reasonable estimate of our fees and scope of legal services. Filing fees for Summary Administration: Filing fees are the costs paid the court to file the case. These fees are approximately $349 in Miami-Dade County. In other counties, the filing fee may be somewhat more or less. Formal Administration If Summary Administration is not available, then the other option is Formal Administration. As mentioned above, Florida law provides a presumptive statutory fee schedule based upon the value of probate assets. It is as follows:

• $100,000-$1 million: 3%
• Above $1 million-$3 million: 2.5%;
• Above $3 million-$5 million : 2%.

Additional fees may be charged at an hourly rate for extraordinary services, such as sale of real estate, preparation of a tax return, if the will is contested, etc. See F.S. 733.6171 Note: The Personal Representative is also entitled to fees for his/her services. The presumptive fee rates for the Personal Representative are similar to, but not the same as, the attorney rates. See F.S. 733.617. Filing fees for Formal Administration. These fees are $401 in Miami-Dade County. Again, in other counties, the filing fees may be slightly more or less. Take Away Points: 1. Find an experienced attorney who concentrates in probate law.

2. Make sure you ask both parts of the question:

– How much does the probate cost?

– What legal services do you expect to receive for these fees?

3. Get an engagement letter from the attorney that addresses both points: how the attorney fees will be charged and the legal services you can expect to receive. For consultation with a Miami probate attorney at Rarick & Beskin, P.A., call (305) 709-2858 or email info@raricklaw.com.

For more information, see our Florida Probate Quick Reference Guide.

2. If there are adult children, I want every dime to go to them – not their spouses.

3. If there are minor children, I want my children to continue to enjoy the lifestyle that they are accustomed to – and I want them to get a good college or university education.

4. I want to avoid court intervention in the event of incapacity: This is called Guardianship, which often starts at $5,000.

5. I want to avoid probate. Probate in Florida is expensive, bureaucratic, and can take 9 months to 2 years. See How Much Does Florida Probate Cost

6. I want to accomplish all of the above at the least possible cost.

It is exceptionally important to first identify your objectives and get the question right. If not, you may be able to find an attorney at the “lowest cost”, but in the long run, it may be the “highest cost” for you and your family. If you fail to identify your true objectives, you may only solve part of your needs. For example, a living trust, by itself, is a poor plan. You likely need a basic estate plan that may start with a Living Trust, but also includes a Florida Health Care Surrogate, Living Will, Durable Power of Attorney, and Pour-Over Will. A good estate plan usually includes all five legal instruments. Note: These instruments must be Florida specific and up to date with current Florida law. “Do It Yourself” programs you may see on TV rarely meet these tests – and usually result in more costs and problems in the long run for your family. Ask for a Scope of Legal Services The second mistake a person seeking legal service may make is failing to ask for a scope of legal services – in writing. Do not simply ask for the costs. Ask, what services does your legal fee include? Most attorneys who specialize in estate planning can give you a flat fee for your estate plan. But you also want a scope of legal services. A scope of work that we present to a married person may include the following:

• Revocable Living Trust: Joint trust for both spouses
• Pour-over Will for each spouse
• Durable Power of Attorney for each spouse
• Living Will (Declaration to Physician) for each spouse
• Health Care Surrogate for each spouse
• Tangible Personal Property Memorandum for each spouse
• Affidavit of Trust for each spouse
• Instruction letter on funding
• One-half hour of consultation regarding funding the trust. (“Funding” is the transfer of assets into the trust.)
• Estate Planning Portfolio Binder
• Report From Counsel: Our periodic newsletter via email of practical legal tips to keep you informed of important legal developments that may impact your family.

The above scope of legal services for a married couple (first marriage) with two minor children, requiring no tax planning, will cost $1,500 – $2,250. Ask The Attorney To Waive the Initial Consultation Free Our firm charges an initial consultation fee of $275 for estate planning. However, we will waive this fee if you are referred via our web site and come prepared with a completed intake form, or you are referred by a past client or professional adviser, such as your CPA or investment advisor. Many other estate planning attorneys have a similar policy. At the initial consultation, the attorney will help you identify your legal objectives. He or she will then give you the legal options for fulfilling those objectives. Lastly, the attorney will give you a scope of work with the total legal fees and costs. Take Away Points: 1. Avoid Mistake Number 1: Finding the least expensive attorney. First, identify your objectives, and then find an attorney who can meet those objectives in the least expensive way.

2. Avoid Mistake Number 2: Don’t just ask for the costs; ask for a Scope of Legal Services.

3. Request the attorney to waive the initial consultation fee. Take advantage of this free consultation; meet with the attorney and learn about your legal options and the total costs. For an initial consultation with a Miami Trust Attorney at Rarick, Beskin & Garcia Vega, P.A. call (305) 709-2858 or email info@raricklaw.com.