2016 LEGAL PLANNING UPDATE – LEGAL ISSUES AFFECTING RETIREES
January 30, 2016
• It’s EZ to make a Will! NOT! Recent FL case held court can’t help you if you botched your will and left out residue, even if the court could surmise your intent. In that case, an “EZ Legal Form” proved to be too tough for the consumer, and the court could not accept a defective Will amendment. “Partial intestacy” was the result instead. Q: Is change coming?
• Whoops, I forgot something! What if the attorney preparer of a Revocable Trust completely forgot Exhibit “A”, which identified the named trust beneficiaries? Unlike the defective will case above, the FL court allowed Reformation of the trust in accordance with the Trustor’s intent, under the FL Trust Code. Bottom line: Trusts are still more flexible to “fix” or “reform” than wills. This may change with future application of 2011 FL Probate Code changes.
• Look deep into my eyes and then do EXACTLY what I say! FL court took the unusual step to invalidate a will upon a finding of Undue Influence by the Testator’s surviving spouse. This was a fourth marriage with the adult daughter of the Testator positively affected by the Undue Influence found to exist by the court, leading to the will for wife #4 being invalidated.
• Be it ever so humble, there’s no place like home. FL courts generally look for a way to extend ad valorem homestead tax exempt status and “Save Our Homes” cap to surviving spouses, as a recent FL case demonstrated. Currently that same protection has not been extended by reported decision or by AGO to a surviving adult child of deceased parent.
• “I, Ted, take you, Fred, to be my wedded spouse…” Same sex marriage is now the law of the land, and that implies and imposes (almost) everything that a traditional marriage does. In FL, a surviving spouse has homestead, exempt property, family allowance, and other survivorship rights, unless expressly waived in a valid pre- or post-nuptial agreement.
• If you are Incapacitated, then Guardianship is Your Friend! BIG TIME WRONG! Guardianship is a solution of last resort. There is no perfect Guardianship protocol in any state. Florida’s has been the target of intense criticism over the past 30 years and, despite numerous and continuing attempts by the Legislature to improve the process, the sheer number of “exposed” vulnerable seniors and adults with disabilities means that this two-tiered judicial process laden with extensive procedural and due process requirements will continue to be in high demand. Avoid Guardianship if you can with forward thinking lifetime legal planning and building a good team around you!
• “I didn’t really mean my Living Will/DNRO! I WANT TO LIVE!!!” Advance Directives have changed in the past year, with the HCS now being “immediately effective” at your option, and also better addressing HIPAA access rights of your surrogate. Listen out for “POLST” to be coming out of the Legislature this year or next, for a more detailed coverage of your Physician’s terminal illness medical treatment order.
• Income Taxes Rule Estate Taxes. Does your current legal plan correctly reflect that change in emphasis? Reportedly only 4,500 returns required the payment of federal estate taxes in 2015. The focus now is on capturing the “Step Up In Basis” at the time of each spouse’s death, to minimize potential future capital gains taxes on children and grandchildren.
• How to leave your IRA to your Deadbeat Son’s Creditors? Name your son individually as the IRA beneficiary. Only Florida offers strong asset protection for inherited IRAs. Other jurisdictions do not. Nor does the federal Bankruptcy Code. Use a specially designed IRA Inheritance TrustTM/SM instead to ensure both future asset protection and “stretch-out” of RMDs for your son’s inherited IRA. Multiple IRA beneficiaries can also be protected in this manner, which each using their own life expectancy for future RMD withdrawal purposes.
• “Asset Protection” and “Medicaid” Advisors Rock LTC Planning! WRONG! In fact, many of these so-called planners were not licensed by any recognized body and were engaged in the illegal and unlicensed practice of law in Florida. These “planners” are sometimes the worst to exploit vulnerable seniors and adults with disabilities, under the guise of “planning services” for benefits eligibility purposes. Talk to a qualified Elder Law attorney for your legal planning!
• Scams and Scammers; Exploitation of Seniors & Disabled. FL Legislature, courts, and law enforcement are all increasingly aware of this great risk to our state’s senior adult and disabled community. Expect to see more criminal prosecutions and civil lawsuits filed in the future due to recent statutory changes.
• What do you mean I’m a Fiduciary? Trustees, Personal Representatives, Guardians, Attorneys, Accountants, Agents under a DPOA, caregivers, and others in a close trusted position or relationship implying trust owe a duty of loyalty and a duty of care to those who are legally or practically relying on them. Self-dealing and conflicts of interest violate the duty of loyalty.
• Getting Real with Your Own Legal Planning in 2016! Your best suited legal plan for your lifetime and post-mortem needs to be up to date, flexible, consistent with Florida law and your and your family’s own unique planning needs and desires. Many completely overlook the risk of future LTC planning costs for themselves and their spouse. We have many legal planning options to help you. Don’t limit yourself to use of “doc in a box” generic forms, out of state internet services, or limited of prepaid legal plan insurance services, when you require detailed and experienced, through legal counseling, legal planning, enforceable legal documentation, and ultimately the successful implementation of your own legal plan!
For you own legal planning consultation, contact Paula Emery at our office to schedule a meeting with one of our Florida Estate Planning and Elder Law Attorneys. Call 904-264-8800 or email firstname.lastname@example.org to schedule your consultation today!
© 2016. Grady H. Williams, Jr., LL.M., Attorneys at Law, P.A.