“The September of My Years”

Before attaining 70 1/2, you should review all of your Florida estate planning documents along with those describing financial and retirement benefit planning.  Because the age of 70 1/2 has been magically designated by the Congress of the United States and the Internal Revenue Code as a lock-up date for certain types of tax-deferred compensation plans, it is imperative that all persons within a year of 70 1/2 review their plans to avoid any income tax and/or estate tax complications.

If you have not already done so, you should prepare a Will in conjunction with a Living Trust (in many, but not all, circumstances), Durable Financial Power of Attorney, Living Will and Designation of Health Care Surrogate. I say that a living trust can be used in many, but not all circumstances, because, although a Living Trust avoids probate and can have tax provisions which can help your estate avoid estate tax consequences at death, not everyone has these worries.

A Living Trust is appropriate if there is a second marriage and you want to provide for the surviving spouse, but also ensure that your children from your first marriage also inherit from your estate.  It can also be useful if you have an adult child that has drug problems or cannot handle money, as well as adult child who may be disabled and/or become disabled.  In these events, special trust provisions must be created to protect the trust assets from bad decisions of a child or to avoid the interruption of governmental benefits that a special needs child may be receiving.

If a second marriage or children with special needs is not a concern for you, you may be able to design your estate plan without the use of a trust.  For instance, if you own a house that you wish to avoid probate, Florida allows for the use of an enhanced life estate deed.  Essentially, the enhanced life estate deed provides the owner a life estate in his/her/their house, and at the death of the surviving spouse, the deeds lists out who the house will be belong to (presumably, your adult children).  You retain the right to do what you want with the house during your lifetime (i.e., mortgage, buy, sell, rent, etc.) and, if you still own it at your death, the house belongs to those you named in the deed.  They simply record your death certificate and this transfers the title to the named beneficiaries.

Other ways to avoid probate of assets include making sure that bank accounts are payable on death to designated beneficiaries (P.O.D.), that life insurance policies have named beneficiary designations (not your “Estate” and not minor children), that other assets such as retirement accounts, money market accounts and the like also have beneficiary designations.  And, just in case you forgot an asset, your Will is there to make sure that it goes to the person you want it to go to.

As your family circumstances change, contact trusted Tampa Florida attorney, Laurie Ohall, to establish the necessary documents for your family’s health and financial protection.