By: Phillip B. Rarick, Esq., Miami Trust Attorney
I am pleased to announce that we have published on our web site a quick and easy explanation of living trusts. Click here: Understanding Living Trusts. Note: A PowerPoint presentation will appear in your lower task bar; click the presentation.
Every person should have a living trust, regardless of whether you have $10,000 or $900,000.
By Phillip B. Rarick, Esq. and Ashley Fernald
In Florida there is frequently the difficult issue of whether to transfer homestead to a revocable living trust. The client wants to avoid probate and therefore generally wants to transfer the homestead to the trust. However, since the Bosonetto case in 2001, there has been uncertainty as to whether homestead transferred to a revocable trust jeopardizes it’s protection from creditors under Florida’s renowned homestead law.
In Bosonetto, an elderly woman who was about to have a final judgment of more than $100,000 held against her, used most of her invested money to purchase a Florida home. In re Bosonetto, 271 B.R. 403 (Bankr. M.D. Fla. 2001). This was homestead property, but was held in a revocable trust. The Plaintiff argued that trusts cannot claim homestead property as exempt. The court noted that the exemption from forced sale under the Florida Constitution was only applicable to property held by a natural person. The court concluded that because the property was held by the trust, “and because a trust is not a natural person, Defendant Bosonetto may not claim the Florida property is covered by the homestead exemption.” Id. at 407.
By Miami Trust Attorney Phillip B. Rarick, Esq.
Last year I reminded you of a state-wide corporate scam called Compliance Services. Well, they are at it again!
Recently (approximately January 7-11, 2013) you may have received a letter that looks like an “official” letter from the state of Florida by a company called Corporate Records Service, or an email from a company called Compliance Services (not to be confused with the Florida corporation, Compliance Services, Inc.) asking for a fee of $125 for corporate minutes. BEWARE. This is a scam. These notices are not from the Department of State, Division of Corporations. Minutes are not required to be posted with the Florida Secretary of State. Rather, they should be prepared and filed in your corporate book.
By Miami Trust Attorneys Phillip B. Rarick, Esq. and Jay R. Beskin, Esq.
We averted one Fiscal Cliff. How does the new “Taxpayer Relief Act” passed by the Senate on New Year’s Eve impact estate and gift taxes for the American family? Here are three key points:
1. Estate and Gift Tax rates are increased to 40%
By Miami Probate Attorney Phillip B. Rarick, Esq.
Florida’s elective share statute allows attorneys to draft standby Florida elective share trusts. (For a summary of Florida’s elective share see our post: Florida’s Sweeping Elective Share.) As of April 23, 2002, trusts that create property interests contingent upon an election being made are now qualified to fund the spouse’s elective share interests. The requirements for such a trust are set forth at F.S. §732.2025(2) and include: (1) surviving spouse must be entitled to use of the property for life or have all of the income payable as least annually; (2) the surviving spouse has the right to make the trust productive of income or convert it within a reasonable time; and no person other than the spouse has the power to distribute income or principal to anyone other than the spouse.
Rarick, Beskin & Garcia Vega has been trusted by numerous law firms and many families during the past 18 years for probate, estate planning, trust and asset protection cases. To schedule an appointment, call (305) 556-5209 or email info@raricklaw.com.
By Miami Trust Attorneys Phillip B. Rarick, Esq. and Jay R. Beskin, Esq.
I. The Opportunity – And The Problem.
The Opportunity: Gifts to family members and others are free of the U.S. gift tax if under the exemption. Specifically, U.S. Citizens in 2012 can give away assets worth $5,120,000 ($10,240,000 per couple) without having to pay any federal estate tax or gift tax.
A common over-sight of persons moving to Florida is failing to take their trust. They may have packed their trust and taken it with them, but the trust situs remains in their original state. This is usually a mistake.
The fact that a client has moved to Florida will not generally mean that the law governing the trust has moved here as well even if the client is the settlor, beneficiary, or trustee of the original trust. Clients moving to Florida are well advised to have all their trusts reviewed by a Florida attorney regarding such issues as:
Introduction
The Florida legislature recently enacted the “Florida Power of Attorney Act” (“FPOA”, Fla. Stat. §§709.2101-.2402), fundamentally overhauling existing law, and making sweeping new changes. Even though the new law recognizes durable power of attorneys (“DPA’s) executed under the prior law, we are advising clients to update their DPA, if more than a year old, because the changes are so comprehensive. For Florida licensed attorneys who receive our Alert, we are making available at cost our new “Super DPA’s” drafted to take advantage of the new law.
Effective Date: The effective date of the FPOA is October 1, 2011. “Legacy” POA’s, or those signed before October 1, 2011, are not invalid, but the action of the agents or attorneys-in-fact under Legacy POA’s must be interpreted under the new law.
By Phillip B. Rarick, Esq., Miami Asset Protection Attorney
Executive Summary:
Last summer in the case of Olmstead V. F.T.C the Florida Supreme Court held that a charging order is not the exclusive remedy against a single member LLC and indicated that it may not be the exclusive remedy against a multi-member LLC. 2010 WL 2518106 (Fla. June 24, 2010.) This case revealed a major flaw in Florida law for LLC’s: it showed that a Florida LLC could be attacked more easily since the creditor of a single member LLC was not limited to a charging order against a LLC member, but rather could step into the shoes of the member. The new legislation, HB 253, signed by the Governor on May 31, makes clear that a charging order is the exclusive remedy against a multi-member and single member LLC. However, for a single member LLC, the new law provides a significant exception that creditors may be able to utilize to penetrate the LLC, rendering single member LLC’s still vulnerable.
By Phillip B. Rarick, Miami Trust Attorney
Executive Summary
In addition to our sunshine, Florida has one of the best tax and asset protection climates of any state in the country. Florida has no state income tax, no fiduciary tax, no intangible tax, no estate tax, and arguably the most generous homestead laws anywhere in the U.S.A: you can have a multi-million dollar home and this residence will be virtually untouchable by creditors. However, moving to Florida without proper planning does have risks. This Report discusses the risks and explains how to clearly establish Florida domicile.
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