Monroe County, Florida Trusts
No one likes to think about passing on, but it is a necessity, especially if you have property and assets that will need distribution. While the majority of people simply make a will to be submitted to probate, more and more are turning to an alternate form of asset disposition called a living or revocable trust. Trusts allow more flexibility during your lifetime and generally are less complex to negotiate.
Creating a Trust
Trusts can be created inter vivos (during life) or by your will upon your passing. Either way, you will still need a will in most states- Florida included. A signed and witnessed will tends to serve as a backup of sorts to the trust documents; it can dispose of any asset not covered in the trust documents, as well as helping to convey your intentions clearly (which can be valuable if, for example, someone is accused of undue influence on you).
To create a living trust, a settlor (the initial trustee) must have the intent and capacity to create one, and the trust must also meet certain qualifications.
It must have a definite beneficiary, or:
- Be a charitable trust
- Be for the care of an animal
- Be a non-charitable trust, but this will only be enforceable for 21 years or fewer.
Also, the trustee must have duties to perform – it cannot be merely a figurehead appointment – and the same person (except for the settlor) cannot be both the sole trustee and the sole beneficiary. The latter situation would create a possibility that the trustee would simply drain the trust for their own benefit. Starting to sound complicated? That’s why it is so important to consult an attorney with experience creating trusts.
It’s also important that your attorney know the laws specific to Florida. For example, many people choose trusts over wills because of the expectation that a trust can avoid probate. However, while this is true in theory (since assets are in trust, and thus have no need to be probated), many trusts in Florida do wind up going to probate because of creditors’ claims issues. If the settlor of a revocable trust passes away, the trust is liable for up to two years for claims against the deceased. However, if the estate is submitted to probate and advertised, the trust is only liable for claims for the three months immediately following the advertisement. Many people submit their estate to probate even though trusts technically permit it to be bypassed, in order to avoid the longer period of potential liability.
If you have few assets, a trust may not be for you. However, in Florida, there is still an alternative to probate, especially if your main asset is in real property (your home, or an undeveloped lot that may appreciate in value). Florida recognizes what are referred to as enhanced life estates or “Lady Bird” deeds, which essentially grant an enhanced life estate in real property. A life estate is when a person is granted rights to an estate for the duration of their life, but when that person passes on, the estate reverts to the original owner, or may pass to someone new. Usually an owner will pass property to a beneficiary while retaining a life estate for themselves. With a Lady Bird deed, however, the owner retains not only the right to live on the property, but also the right to sell it, commit waste, use and profit from it during the owner’s lifetime, and other perks.
Ensure Your Assets Pass To The Right People
With the right help, planning for your family’s future can be manageable. The Silver Law Group is knowledgeable and experienced in creating trusts and navigating the laws specific to Monroe County, Florida. We will give you the peace of mind you deserve. Contact us at our Islamorada office today to discuss your options.