By: Phil Rarick
Here is a scenario we see more and more with persons who try to do estate planning themselves, specifically Florida Wills, without consulting with an experienced estate planning attorney. Louise has three adult daughters, Erma, Madeline, and Roseanne. The daughters are all close and speak to each other at least once a week. Louise wants to treat them all equally. Louise has four major assets: her home, a traditional IRA, a checking account, and a savings account.
Louise downloads a Florida Will form on the internet and says each child is to get one-third of everything she might own at death. She is careful to sign the will before a notary and two witnesses with a “Self-Proving Affidavit”. Louise dies, and the daughters schedule a meeting with a Probate Attorney. At the meeting the probate attorney informs the daughters that the Will is good under Florida law. However, despite the Will, 100% of the assets go to Erma. Madeline and Roseanne are not happy. How can this happen?
- Home. Louise wanted to avoid probate. She thought a simple way to avoid probate was to title the home in her name and Erma’s name as Joint Tenants With Right of Survivorship. She had a friend draft the deed for her home. The house did avoid a probate process, but upon her death, the house transferred to Erma by operation of law; Madeline and Roseanne received nothing.
- Traditional IRA. Louise had an IRA that she set up many years ago when Erma was born, and before Madeline and Roseanne were born. She never thought to check the beneficiaries named on the IRA or maybe she thought the Will would over-ride any beneficiary designations on the IRA (they do not). Therefore, 100% of the IRA transferred to Erma.
- Checking and Savings Account. Three years prior to her death, Louise had trouble keeping up with the property taxes on her house and paying bills. As a convenience, she went to the bank and retitled the checking accounts in her name and Erma, as JTWROS – joint tenants with right of survivorship. Again, by operation of law, upon her death the checking account and savings account transferred 100% to Erma.
Some persons have the mistaken idea that a signed and executed Florida Will over-rides beneficiary designations on life insurance, annuities or assets such as those owned by Louise. They do not.
How The Story Ends. Louise did avoid the costs of probate – but at a high cost to her family. Erma has two children and recently was forced to retire early. She explained to her sisters that she really needs the inheritance and cannot share it with them. After all, the probate attorney advised her that the law says she is the sole beneficiary. Madeline and Roseanne no longer talk to Erma.
There are many ways to avoid these issues from arising in your family. If you wish to consult with an experienced Weston Estate Planning attorney contact Phil Rarick at 305-556-5209.
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.