Estate Planning is the process of anticipation and arranging for the management and disposal of a person’s assets during their lifetime and after death. Estate planning also includes planning for incapacity during a person’s life. Please call us for an appointment to discuss your needs.
Stone Law Group, P.L. will ensure your wishes are properly documented and carried out while protecting your assets from unnecessary liability or risk.
Some of the matters we routinely handle for our estate planning clients include:
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Revocable Living Trusts
Revocable Living Trust sometimes called a living trust — is a legal entity created to hold ownership of an individual’s assets. The person who forms the trust is called the grantor or trustmaker, and in most cases, they also serve as the trustee, controlling and managing the assets they placed there.
A revocable living trust covers three phases of the grantor’s life: Their lifetime, possible incapacitation, and what happens after their death.
Phase One of a Revocable Living Trust: The Grantor is Alive and Well
The trust’s formation documents should include specific provisions allowing the grantor to invest and spend the trust assets for their benefit during their lifetime. They can go about business as usual with the assets that have been transferred or funded into the trust’s ownership, assuming they haven’t appointed someone else to act as trustee. In this case, the trustee would typically take direction from them.
The Grantor reserves the right to undo a revocable trust — thus the term “revocable.” They can re-claim assets they’ve placed into it, divert the trust’s income to themselves or another beneficiary, sell the assets, or place more assets into it. They maintain final control.
A revocable living trust does not have its taxpayer identification number, unlike an irrevocable trust — one where the grantor gives up all control. A revocable trust and its grantor share the same Social Security number. Trust taxes are filed on the Grantor’s Form 1040, just as though they continued to hold ownership of the assets personally.
Phase Two of a Revocable Living Trust: The Grantor Becomes Mentally Incapacitated
The trust agreement should also specify what happens if the grantor becomes mentally incapacitated and can no longer manage their affairs and those of the trust. The trust documents should name a “successor trustee,” someone to step in and take over management of the trust if the grantor is determined to be mentally incompetent. The successor trustee can then manage the grantor’s finances and the assets that have been placed into the trust.
Phase Three of a Revocable Living Trust: The Grantor’s Death
A revocable trust automatically becomes irrevocable when the grantor dies because they can no longer make changes to it. The named successor trustee steps in now as well, paying the grantor’s final bills, debts and taxes, just as they would if the grantor became incapacitated. In the case of death, however, they would then distribute the remaining assets to the trust’s beneficiaries according to instructions included in the trust’s formation documents.
Last Will and Testament
A Last Will and Testament is a legal document by which an individual, the “testator,” expresses their wishes as to how their property is distributed at the time of their death. It also names a Personal Representative, or “executor,” to administer the estate and settle the individual’s affairs. Regardless of the size of your estate, it is wise to have a valid Last Will and Testament drafted in compliance with current Florida law to ensure your wishes are honored. An individual’s Last Will and Testament identifies the individuals or charities they want to receive inheritance and sets forth the amount that each individual or charity will receive. A Last Will and Testament also addresses who will serve as the Guardian of minor children or dependents. Essentially, a Last Will and Testament is a key instrument used to ensure your wishes are honored, and legally enforceable, after your death.
Consequences of Dying Without a Will
When an individual dies without a valid Last Will and Testament, the individual is said to have died “intestate.” Under such circumstances, the state essentially writes a Will for you and your estate is governed by Florida’s intestacy statute. Florida law dictates how the inheritance is distributed without consideration for a family’s individual circumstances or the decedent’s wishes. Extended family members you haven’t spoken to in years may be in line to receive inheritance under Florida’s intestacy statute. Additionally, the Court can determine who will serve as Guardian of your minor children based upon its opinion of what is in the child’s best interest, rather than what your wishes are. Further, Florida’s intestacy statute may apply in the event your Will is drafted improperly or is not in accordance with Florida law.
Durable Powers of Attorney
A Durable Power of Attorney is a legal document in which you arrange for an individual, or an “agent,” to manage your financial affairs. Not only does this document provide our clients with peace of mind, a Durable Power of Attorney also helps the client’s loved ones immensely. If you do not have a Durable Power of Attorney and you become incapacitated due to an accident or illness, your loved ones would actually have to petition to Court to be appointed as a Guardian in order to have legal authority over at least some of your financial affairs.
It is important to note that a Durable Power of Attorney in Florida becomes effective the moment it is signed. Contrary to popular belief, a Durable Power of Attorney in Florida does not “spring” into effect when you become incapacitated – your agents can use the document immediately. Accordingly, it is important to select agents you trust implicitly. Further, a Durable Power of Attorney remains in effect until death, unless you revoke it. You may revoke a Durable Power of Attorney at any time, unless you become incapacitated.
Health Care Surrogates
The Health Care Surrogate is a document naming someone else who will make health care decisions for you if you are unable to make them yourself. It is similar to a Durable Power of Attorney, which primarily deals with property.
While a Durable Power of Attorney is effective at the time of execution, the Health Care Surrogate generally requires that you lack capacity to make your own decisions. Your attending physician (and sometimes a second physician) must determine that you are unable to make health care decisions before the surrogate can take over.
A Health Care Surrogate is intended to provide direction and authority, helping to avoid conflicts and confusion over your care. You cannot assume a physician has the authority to make health care decisions for you and (unless the patient is a minor) family members do not have the legal right to make decisions for you.
Expect families, and even physicians, to disagree about treatment options, especially in cases where you have remarried or family members have become estranged. The Health Care Surrogate puts these arguments to rest.
You can choose any person to make health care decisions for you and your loved ones will need to respect your wishes. When deciding whom to choose, many people worry about placing an undue burden on a family member, such as an adult child, during an emotional time. However, knowing your specific wishes will help make decisions easier.
Some people consider naming someone outside the family to avoid appearing to play favorites between family members. However, keep in mind that your health care surrogate will make life and death decisions for you—decisions best left to those closest to you, such as your spouse or children.
Ultimately, giving careful thought about whom to designate, and having a Health Care Surrogate on file, can provide welcome direction and significantly reduce infighting among family members and confusion by medical professionals regarding treatment decisions.
What happens if you have not designated a health care surrogate? If you are incapacitated, either by an illness or accident, a Florida judge will select a court-appointed guardian. These proceedings are not only costly, but loss of your privacy and selection of a less desirable guardian is a common result. It is easy to avoid this result by taking the time to sign a Health Care Surrogate.
What Is a Living Will?
A Living Will is a document that explains whether or not you want to be kept on life support if two licensed doctors state you have no medical chance of recovery or you are in a persistent vegetative state, have a terminal illness or end-stage condition. It also addresses other important questions, detailing your preferences for tube feeding, artificial hydration, and pain medication in certain situations. A Living Will becomes effective only when you cannot communicate your desires on your own.
A Living Will is usually limited to the refusal of, or desire for, medical treatment in the event of:
- a terminal illness
- an end-stage condition, or
- permanent unconsciousness
In the event you are unable to communicate your desires in such situations and do not have a living will, doctors or hospitals may decide they are legally obligated to perform certain procedures that you would not desire. If your spouse, adult child or another relative is called upon to make a decision about your care, he or she will find it helpful if you have expressed your wishes in a living will. A Living Will tells others what you want to happen in such circumstances.
You may see a living will called by other names, such as:
- a declaration regarding life-prolonging procedures;
- an advance directive; or,
- a declaration.
Living Will Compared to a Last Will and Testament
It is important not to confuse a Living Will with a Last Will and Testament. A Last Will and Testament expresses what you want to happen to your property and minor children if you die. A Living Will expresses what you want to happen to you personally regarding medical treatment while you are still alive.
We are here for you every step of the way, call and set up an appointment to come in and meet with our legal counsel.