As people think about their loved ones, and long-term obligations to them, invariably thoughts turn to Wills and Trust. It is never too early to speak to an expert on issues of inheritance and succession planning. Life tends to change unexpectedly sometimes even randomly. The best time to make estate planning decisions is now – when you can reflect on what you want and have meaningful conversations with family members. A comprehensive estate plan is one of the greatest gifts you can give yourself, your spouse, and your family. The Victoria Law Group can work with you to help ensure that your financial goals are met.
Wills and Trusts are vital components of good estate planning. Although both share the ultimate goal of distributing your property after you pass on, each has its own unique advantages and disadvantages.
Important differences between a Will and a Trust are:
Property, assets and legacies are not made easily. If you have worked hard enough to own it, you must work smart enough to protect it and to control the distribution of your assets. The Victoria Law Group is willing and able to help you ensure that your financial goals for your family survives.
Please contact us when you are ready to have this serious conversation.
Both, Wills and Trusts are methods for exercising control over your assets and are tools by way of which you decide. The assets, after a person passes on intestate, pass on to the surviving spouse in the U.S. without incurring tax liabilities by virtue of the United States Estate and Gift Tax Law. Making a Will before you pass on helps you in planning the distribution of wealth and assets. By way of a Will, the deciding power comes in your hand and you allocate resources as per your wish and desire.
Probate is another aspect linked to a Will which involves assigning the assets to an administrator who acts as a manager for your assets. The administrator is bound to distribute assets and pay the creditors through a legal process which may often be time consuming. A Testamentary Will – one of the most commonly drafted Wills — lets you appoint guardianship of your children and lets you exercise control over your property.
A Trust, on the other hand, does not require a Probate. This is very often understood as an advantage of people using a Trust to distribute their assets. Trusts are considered less expensive than a Will and the terms of a Trust are private as compared to a Will and Probate process whose terms are public. The method of distribution of assets through formation of a Trust is quicker. In a Trust, the Trustee is authorized to distribute assets without the requirement of filing documentation and exercising formalities with the Probate court. In case of a Will, the procedure begins from drafting a Will cautiously and goes on until the appointment of an executor to carry out the provisions of the Will keeping their true intent in mind. The executor appointed in a Will is required to carry out the documentation process and distribute assets to the beneficiaries. When compared to Wills, Trusts also eliminate costs by saving estate taxes.
Wills and Trusts have their own advantages and disadvantages and it is also true that both are used frequently. There are some assets which remain outside the scope of a Trust so a Will is executed for their transfer. The ultimate result of making a Will and a Trust is similar but the process associated with both differ substantially.
Probate is a process which is supervised by the Courts in the State of Florida. The process is governed by the Florida Probate Code (which is a part of Florida Statutes) along with the Florida Probate Rules. Probate proceedings are filed with the circuit court where jurisdiction depends upon the last resided place of the deceased person. Transfer of ownership of assets through a Trust, on the other hand, does not involve filing through a court and is much simpler that way.
One may expect the cost of forming a Trust to vary depending on the size of the Estate, the number and variety of assets in the Estate, and the number of attorney hours associated with drafting the Trust.
Florida is a State where Trusts can last almost into perpetuity. The Trusts can last even more than 360 years in Florida. But it is also true that a Trust need not necessarily last that long. It can also be for a limited time frame or come to an end upon a certain “triggering” event. It must be remembered that a Trust, when created, may last for the lifetime of the person creating it and/or even beyond.
A Will is made for fulfilling your desires and responsibilities with respect to owned assets. One must always stay away from including unnecessary and confusing details in a Will. Additionally, a Will should not include transfer of assets or property with joint owners. Here’s a list of common details that should not be included in a Will:
To sue a Trust located in Florida, a lawsuit is required to be brought in the Circuit Court of proper jurisdiction in Florida. The manner of suing a Trust is through filing a lawsuit.
By virtue of the existing and prevailing law, Trustees are held accountable to the beneficiaries. A fiduciary duty has been imposed on the Trustees to perform duties following highest standards of good conduct. The Trustee has a duty to administer the Trust in good faith and as per the provisions of the Florida Trust Code.
Section 736.0801 of the Florida Statutes is titled as “Duty to Administer Trust”. The said provision provides for the following obligations for the Trustees to follow:
Ø The Duty of Loyalty is mentioned first in the Florida Trust Code. It obliges a Trustee to administer the Trust solely in the interests of the beneficiaries. The Code further goes on to highlight instances which will be considered a conflict between personal and fiduciary duty of a Trustee.
Ø The next duty imposed on a Trustee is that of Impartiality. A Trustee is required to administer Trust and its duties impartially and fairly only in the interest of beneficiaries. The Trustee must give due regard to each beneficiary’s interest if there are multiple beneficiaries.
Ø Next duty a Trustee is required to fulfil is the Duty of Prudent Administration. It requires the Trustee to exercise reasonable care, skill and caution in administering the Trust. The intent is that a Trustee should administer the Trust as a prudent person by considering the purposes of the Trust and prevailing circumstances.
Ø The Trustee is also endowed with a duty to Control the expenses of administration of the Trust. The expenses must be reasonable in relation to the Trust property, the purposes of the Trust, and the skills of the Trustee.
Ø The Trustee has another duty to control and protect the Trust property and must take all reasonable steps to do so.
Ø The Trustee also has the duty to provide all the necessary information related to the Trust to beneficiaries when requested to do so.
Ø A Trustee must keep the Trust’s property separate from his own personal property.
Ø A Trustee is also required to keep clear, distinct, and accurate records of the administration of the Trust.
All the duties described herein are not exhaustive and the law provides for even more duties.
The Trustee has been endowed with duties by a statute i.e. the Florida Trust Code. In situations where the Trustee is not doing his duties or not performing the required duties, a Trustee may be sued by any beneficiary. Generally, a Trustee is sued by initiating a lawsuit within four years.
The lawsuit is brought at a place with which the Trust has connection. For a Trust located in Florida, a lawsuit may very well be brought in the local Circuit Court of appropriate jurisdiction in Florida. If the county has separate Probate divisions, the lawsuits are brought there but if it is otherwise then the lawsuit is brought in the general Civil Division of the Circuit Court.
The place of jurisdiction depends upon the circumstances of the case, location of the Trust, and the location of the Trustee as well.
The relevant law with respect to this question is contained in the Florida Trust Code. It must be noted that neither the Code nor the Florida Rules of Civil Procedure makes it mandatory to hire a Trust lawyer in order to successfully bring a lawsuit.
But it is advisable that a lawyer be hired as the matter may take highly complicated and technical turns.
In the circumstances in which a person passes on without making a valid Will, he/she is described passing on “Intestate”. In Florida, the state does not take or acquire assets of the deceased in case one passes on Intestate but those are distributed to the heirs of the deceased in accordance with an order of priority set by the prevailing Florida Law.
The distribution is done in accordance with the order of priority which is as follows:
Ø In situations where the decedent is survived by a spouse only and no living heirs (children, grandchildren, parents or other remote descendants) are there, the surviving spouse is entitled to receive all the estate of the deceased.
Ø In situations where the descendant is survived by a spouse and living descendants (those who are descendants of both the deceased and the surviving spouse) also, the surviving spouse is entitled to receive all the estate of the decedent. In such a situation, the spouse must not have additional living descendants who are not descendants of the deceased.
Ø In situations where the decedent is survived by a spouse and living descendants (those who are descendants of both the deceased and the surviving spouse) also but the surviving spouse also has such living descendants who are not descendants of the decedent, then the estate of the deceased is divided equally between the surviving spouse and the decedent’s descendants.
Ø In situations where the deceased was unmarried at the time of his death but is survived by heirs or descendants, the descendants are entitled to the estate of the deceased. The estate will be divided equally amongst all the descendants as per the Florida law.
Ø In situations where the deceased was unmarried at the time of his death but is survived by no descendants, parents of the deceased will be entitled to receive the estate of the deceased or to the siblings of the deceased, if they are living.
Ø In situations where no descendants of the deceased are living at the time of his death, the estate of the deceased will be passed on to the remote heirs.
The rules described above are subject to other provisions and laws contained in the Florida laws.
Here are some examples of assets which are exempt from Probate in Florida:
Ø A life insurance policy,
Ø annuity contract,
Ø individual retirement account payable to a specific beneficiary etc.
The costs are calculated as per the attorney’s fee, the court fee and the filing costs. The court filing costs are generally above $250 and is dependent upon the nature and size of the assets involved in a Will Probate. Most attorneys will act on the beneficiary(ies) behalf for a fixed percentage or fixed fee depending on the size of the Estate.
Yes, the Florida law requires that. It is mandatory for a person who has possession of a Will to file it with the clerk of the local Circuit Court after learning of the death. If a subsequent Probate proceeding follows, the court will determine if the Will is valid or invalid. Prior to the death of Testator (the individual making the Will), the Will does not have to be filed with the Court.
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