Category: Probate

With an incoming presidential administration and a Democrat majority in Congress that promises to raise taxes on the wealthy, there is a good chance that the federal estate tax could increase and you could owe more taxes when you die. The federal estate tax is a tax on your right to transfer property at your death. The new administration could try to reduce the federal estate tax exemption and even raise the tax rate. Therefore, an effective estate plan with estate tax considerations is more important than ever.  Luckily, there are some ways to reduce, limit, or completely avoid estate taxes, depending on the size of your estate when you pass away.

Inter Vivos (Lifetime) Gifts

During your lifetime, you can give family members or other beneficiaries gifts up to a certain amount each year and avoid the federal gift tax also.  By giving away your cash or other assets during your lifetime, you are effectively reducing your estate tax exposure since you will not own the property at the time of your death. But remember, there are both annual and lifetime limits to the gift tax exemption.

Marital Trusts

If you are married, then a Marital Trust is a great tool for reducing or even eliminating your combined estate tax exposure. Assets in a marital trust that are held by the surviving spouse are not subject to federal or state estate tax. The surviving spouse can also extend tax and credit shelter benefits to his or her heirs. If the assets remaining in the marital trust are less than the surviving spouse’s exemption amount, there will be no estate tax due upon the death of the surviving spouse.

Irrevocable Trusts

By transferring your property into an Irrevocable Trust, the property no longer taxable at your death because the grantor, having effectively transferred all ownership of assets into the trust, legally removes all of their rights of ownership to the assets and the trust. Therefore, the property transferred into an irrevocable trust is not part of your estate and would not be subject to the estate tax upon your death.

Another way to reduce or avoid estate taxes is by having your attorney setup an Irrevocable Life Insurance Trust. Life insurance proceeds generally aren’t taxable, but they could be included in your estate, which would be subject to estate taxes.

However, irrevocable trusts are not always a good strategy depending on the circumstances and you should always consult with an experienced estate planning attorney about what is best for you and your family.

Qualified Personal Residence Trust

A Qualified Personal Residence Trust (QPRT) is a specific type of trust that allows its grantor to remove a home from his or her estate for the purpose of reducing the amount of gift tax that is incurred when transferring assets to a beneficiary. The home is still your property during your lifetime (a/k/a life estate), and then it automatically transfers to your beneficiaries upon your death through the terms of the QPRT. Ultimately, you will be reducing the size of your taxable estate with a QPRT because you only hold a lifetime interest in the home.

Conclusion

Not everyone will have the same estate tax exposure when they die, but it is always a good idea to plan ahead for the sake of your family and loved ones. You also don’t want the government to take away everything you worked so hard for!  Give the law firm of Loshak Leach, LLP a call today at (954) 334-1122 for a free consultation with a professional estate planning attorney.

Despite the common misconception, the Massachusetts Estate Tax could apply to any decedent who owns tangible property or real estate in the state, regardless of whether they were a resident or not. The tax applies based on the gross value of the estate. Fortunately, if you do not live in Massachusetts, you might be able to avoid this tax in relation to investment or business real estate holdings.

If you have questions about planning your estate and minimizing your tax liability, contact Loshak Law PLLC today. Our law firm works with Florida residents to create intelligent estate plans that will offer our clients peace of mind.

Why Avoid the Massachusetts Estate Tax

There are federal and state estate tax laws. For the year 2021, the Federal Estate Tax only applies to estates exceeding $11.7 million USD in value. Only twelve states apply their own estate or inheritance taxes, and unfortunately, Massachusetts is one of them with a current estate tax exemption of $1 million USD. This means that if a Massachusetts resident or non-resident dies and leaves behind an estate valued at more than $1 million USD, it could be subject to an estate tax of up to 16%.

Not only is Massachusetts in the minority of states to levy an additional tax, but it also ties with Oregon for the two states with the lowest exemption level. Residents of Florida who own property in Massachusetts could leave their heirs dealing with burdensome tax rates. If you are in this position, it is worth looking into how you could avoid this tax.

Using a Limited Liability Company to Avoid Estate Taxes in Massachusetts

Suppose you own real estate in Massachusetts as an investment. In that case, you should consider forming a Limited Liability Company (“LLC”) and shifting the ownership into that LLC rather than in your individual name. An LLC offers many protections and tax benefits, including avoiding the estate tax for real estate, but it must be an investment property with a legitimate business purpose and not a second home.

The best strategy for avoiding estate taxes for investment real estate owned by non-residents in Massachusetts is to hold title to the real estate in an LLC and not their individual name. In addition to liability protection and potential income tax benefits, conveying your investment real estate to an LLC avoids the Massachusetts Estate Tax with respect to said property because it no longer constitutes real estate.

According to Massachusetts tax law, LLC interests are considered intangible property and are not subject to Massachusetts estate taxes. If Massachusetts property is transferred into an LLC and is owned by a Florida resident, there would be no estate tax liability since the LLC is an intangible asset and no longer considered real estate for estate tax purposes. See Estate of Nielsen v. Commissioner, Docket No. F232365 (Mass. App. Tax Bd. 2001) (explaining that a partnership interest is not taxable, but an interest in a realty trust is taxable for Massachusetts estate tax purposes).

Hiring an Estate Planning Attorney

Estate planning tools can help you protect your wealth and reduce the stress that your family will face in the future. Tax laws are complex, and failing to create a strategic plan might leave your beneficiaries paying unnecessary taxes.

The lawyers at Loshak Law PLLC will work with you to create a plan that safeguards your interests and those of your family. Call us today at 954-334-1122 to schedule a free consultation.

If a person dies and nominates you as a personal representative of their estate, you will have many responsibilities regarding distributing that individuals’ assets. One issue you will need to address is hiring a Florida probate lawyer.

Hiring a lawyer to handle probate administration tasks will come with certain expenses. You likely have questions regarding the amount of attorney fees you will need to pay to complete the probate process. The fees will vary depending on several factors, including the size of the estate. Florida state law includes limits the amount of probate fees that a lawyer can charge.  Below is more information regarding what you can expect when you hire a Florida probate lawyer. If you have questions, contact Loshak Leach, LLP, to consult with one of our probate attorneys.

How Florida Probate Attorneys Calculate Their Fees

Florida Statute 733.6171 states the fees an attorney can reasonably charge to administer an estate. It is important to note that certain estates will qualify for summary administration and reduced filing fees and costs, but only estates worth small sums will qualify. The following calculations indicate the fees that the court feels are reasonable and that you will likely pay in a Florida probate case:

  • $1,500 for estates worth $40,000 or less
  • $2,500 for estates between $40,000 and $70,000
  • $3,000 for estates between $70,000 and $100,000
  • Three percent of the estate value for estates between $100,000 and $900,000
  • Two and a half percent for estates between one and three million
  • Two percent for estates between three and five million
  • One and a half percent for estates between five and ten million
  • One percent for estates of ten million and above

The statute also allows attorneys to charge an hourly rate and additional probate fees in cases where the estate administration is particularly complex, such as when someone is contesting the will.

To understand the likely attorney fees, you will need first to determine the value of the estate. The compensable value of the estate, which is the amount the above fees will depend upon, is the value after removing the homestead property and personal property from the total.

It might also be possible to use a different method to determine compensation as long as the manner is clear to the attorneys and the client and does not conflict with Florida Statute 733.6171(2).

Estate Planning Tools Can Avoid Probate

Probate administration can be costly and take a long time to complete. Fortunately, there are ways that individuals can avoid probate entirely and plan for easier administration by creating an estate plan.

Below are several strategies that will help your family bypass probate:

Living Trusts: A living trust is one of the most common ways of avoiding probate. If you create a living trust, that trust owns the assets and can pass to your beneficiaries through trust administration rather than probate. Trust administration is a more straightforward process and typically will not require the court’s oversight.

Payable on Death Accounts: Another strategy for bypassing probate is payable on death designation for a bank account. A payable-on-death account may be a savings account where you control the money until the time of your death. The beneficiary directly receives that money without needing to go through probate.

Transfer on Death Deeds: Although transfer on death deeds are not an option based on Florida law, there is a different form of deed that can accomplish a similar function. A ladybird deed is a type of enhanced life estate.  This designation will help real estate pass without going through probate.

Titling: Proper use of titles can also help families avoid probate. For instance, joint ownership with rights of survivorship or tenancy by entirety will allow the property to move from the decedent’s estate enter the beneficiaries’ ownership without probate. This process will also work for vehicles.

Taking the time to create a detailed estate plan can help protect your loved ones. Creating a trust or using these other tools or provide you with some peace of mind. It is essential to understand that drafting a will alone will not avoid probate. Although wills are sometimes a valuable part of an estate plan, it is wise to understand how other options may provide additional benefits and save time, money, and stress for your family.

Speak to a Florida Probate Attorney Today

If you are handling a loved one’s probate estate, you will likely require legal counsel from an experienced Florida probate lawyer. An estate planning lawyer could also help you draft your documents to protect your loved ones in the future.

The attorneys at Loshak Leach, LLP offer a reasonable hourly fee rate capped at the amount listed in the statute. We work to keep our fees lower than most competitors because we strive to offer our clients reasonable rates.

Probate administration and estate planning can be confusing and intricate. Call Loshak Leach, LLP to speak to one of our dedicated Florida probate and estate planning lawyers.

When someone dies owning real estate in Florida and does not have a carefully drafted estate plan or has a defective title (a/k/a invalid deed), then a probate administration may be necessary. There are several instances where this may occur, and here are a few examples:

Title Held Individually or as Tenants in Common

In many instances, the title to real estate is held in an individual’s name (“fee simple”) or by a group of individuals, which is legally known as “tenants in common.” Individuals holding title to real estate as tenants in common have no rights of survivorship, which means that when someone dies, the decedent’s individual interest in the real estate will need to be probated in order for it to pass on to the heirs of the estate.

Joint Tenants with Full Rights of Survivorship

Another way that a group of individuals or family members can hold title is called “joint tenants with full rights of survivorship.” This means that if one owner dies, the surviving joint tenants absorb the decedent’s interest in the real estate.  In Florida, the doctrine of the right of survivorship in cases of real estate held jointly by individuals is not recognized, unless the instrument creating the estate shall expressly provide for the right of survivorship. Again, each individual’s estate would need to be probated if the deed does not contain these magic words.

Tenants by the Entirety

In Florida, when a husband and wife acquire real or personal property jointly, it is presumed that title is held as “tenants by the entirety” with rights of survivorship. This means that the surviving spouse would automatically acquire the deceased spouse’s interest in the real estate.  However, upon a subsequent divorce, the former spouses will hold title to the real estate as tenants in common.

Defects in the Decedent’s Title 

There are also many circumstances where the actual deed that conveyed title to the decedent is defective on its face. The Florida conveyancing laws involving real estate are complicated, convoluted, and can be very unforgiving. Some examples of this are:

  • Incorrect legal description
  • Invalid deed execution
  • Wild deed in the chain of title
  • Fraudulent conveyance
  • Invalid will, trust, or probate administration

Should any of the foregoing conveyance defects arise, then the heirs or devisees of the decedent may very well find themselves in the midst of an expensive probate administration, or even worse, litigation.

How Do I Avoid These Title Issues and Probate Administration?

Luckily, there are ways to avoid these title issues that could require a probate administration in Florida!  The experienced attorneys at Loshak Law PLLC can draft an estate plan involving trusts and other legal documents that will avoid the need for a probate administration involving your real estate investments. Or if you are the heir or devisee of an estate that needs to be probated, we can help with that too!  Give us a call today at (954) 334-1122 for a free consultation.

What is Probate Administration?

When someone dies with bank accounts, real estate, or other assets held in their individual name, the legal process required to distribute the property to the decedent’s heirs or devisees is known as probate administration. In Florida, this process is governed by the Florida Probate Code and should always be done with the assistance of an experienced attorney.  Florida is one of the few states that statutorily specifies a schedule of attorney’s fees which are deemed to be reasonable based on the total value of the estate.

What Property Must Be Probated?

Any property held or titled in the decedent’s individual name, regardless of whether they had a Will or not, must be probated, with a few exceptions. Some examples of non-probate property are accounts held jointly with a spouse, property held in a trust, life insurance proceeds, or an investment account with pre-designated beneficiaries. Avoiding the expensive and time-consuming process of probate administration is always preferable, so that’s why it is a good idea to have a professional estate plan prepared by an attorney.

Disposition Without Administration

In Florida, there is a non-court supervised administration proceeding called Disposition Without Administration, which applies to the estate of a decedent leaving only personal property (and no real estate) exempt from the claims of creditors and nonexempt personal property the value of which does not exceed the sum of the amount of preferred funeral expenses and reasonable and necessary medical and hospital expenses of the last 60 days of the last illness. This process is used to request the release of assets of the deceased to the person who paid funeral and/or final medical bills.

Summary Administration

An abbreviated and simplified procedure called Summary Administration, is available when: (1) the assets of the estate are under $75,000; or (2) the decedent has been dead for more than two (2) years. The court doesn’t appoint a personal representative or executor for the estate. Instead, the court issues an order, releasing the property to the people who inherit it. The petition for summary administration may be filed by any beneficiary, or by a person designated as a personal representative by the decedent’s Last Will and Testament. If there is a surviving spouse, the petition must be signed and verified by the surviving spouse.

Formal Administration

If the estate doesn’t qualify for one of the aforementioned simpler methods of administration, the regular Formal Administration process may be necessary.  In a formal proceeding, a personal representative is appointed by the court to administer the estate, which includes marshalling assets, settling creditor claims, and distributing assets to the heirs or devisees. The personal representative is usually an individual named in the Will, the surviving spouse, child of the decedent, or a close family member. The court issues a document called Letters of Administration, which gives the personal representative authority to administer the estate. Upon completion of the estate administration, the court issues an order closing the estate and relieving the personal representative of further responsibilities.

Ancillary Administration

If the decedent owned property in Florida (usually real estate), but was a not a Florida resident, then an Ancillary Administration may be appropriate if there was a domiciliary proceeding in the state where the decedent resided at the time of his or her death. This could require either a summary or formal administration, depending on the circumstances. In any event, there must be a personal representative named to represent the ancillary estate per Florida law.

You should always consult with an attorney if you have a loved one who has passed away with assets that might need to be probated. The experienced attorneys at Loshak Law PLLC routinely assist their clients with Florida probate administration matters. Call our office today at 954-334-1122 or contact us online to schedule your free consultation!

Pursuant to F.S. § 733.710, creditors have two years from the date of death of a person to file a claim against the estate. The exceptions to this statute of limitations are federal and state government claims, and the lien of any duly recorded mortgage or security interest or the lien of any person in possession of personal property or the right to foreclose and enforce the mortgage or lien.

If an estate has not yet been opened for a deceased person, a creditor may file a “caveat” with the probate court to preserve their claim pursuant to F.S. § 731.110. If and when the estate is opened, the clerk notifies the personal representative of the claim against the estate. If there are sufficient probate assets in the estate, then there is a good change the claim will be paid depending on the order of payment of expenses and obligations set forth in F.S. § 733.707.

If an estate has been opened within two years from the decedent’s date of death, then a creditor must file its claim on or before the later of the date that is three months after the time of the first publication of the notice to creditors or, as to any creditor required to be served with a copy of the notice to creditors, thirty days after the date of service on the creditor per F.S. § 733.702.

Whether you are a debt collector, business or an individual that has a claim against a deceased person’s estate, don’t delay and contact the attorneys at Loshak Law PLLC today to assist with perfecting and collecting on your claim.

The worldwide COVID-19 pandemic has recently brought the uncertainties of life to everyone’s attention. This is particularly the case due to this disease’s acute risk to adults and elderly patients, who are at a heightened risk for severe complications. This has led to otherwise healthy people dying suddenly without an estate plan in place.

That kind of uncertainty can weigh heavily on that individual’s family members, who must now do the hard work of administering their loved one’s estate while also grieving their loss. With this in mind, now is a perfect time to prepare or revisit your estate plan. After all, being prepared always pays off when life takes an unexpected turn.

What Can an Estate Plan Do for Me?

In practice, a proper estate plan can serve a critical purpose, both for you and your family. For you, an estate plan can provide peace of mind relating to how your possessions and wealth are distributed in case of your passing. Along the same lines, an estate plan can also solidify who will care for your children or other loved ones in your absence.

Meanwhile, an estate plan can help smooth asset transmission process from your family’s perspective. In other words, an estate plan can help prevent conflicts among family members who may have differing views on who was to receive what after your passing. In effect, your estate plan will serve not only as a guide for your family, but also as your definitive word on many issues that may crop up after your death.

What Happens If I Don’t Have an Estate Plan?

Without an estate plan in place, your estate will need to be probated. This means that a probate court will step in to act as administrators of your assets. These courts follow certain state laws relating to estate administration, which may or may not be favorable to your family. This is particularly true when it comes to taxes, which are often more burdensome in a state-administered asset plan.

Along the same lines, state administration of your assets can leave your family exposed to a great deal of scrutiny. This is because that state makes these administrations a matter of public record. In turn, creditors and other outside groups will be able to pursue your assets, even after you have passed on.

Popular Estate Planning Tools

Here are just a few of the most widely used estate planning tools that you should consider pursuing:

  • Will – A legal document that acts as an instrument for distributing your assets after your passing.
  • Living Trust – A legal document that grants trusteeship to an individual for the purpose of asset distribution. These documents are more flexible and can be modified more easily while the grantor is alive. They can also help avoid certain estate taxes for married couples.
  • Healthcare Surrogate & Advanced Directive – A legal document that appoints an individual to make medical decisions on your behalf if you are incapacitated from doing so yourself.
  • Durable Power of Attorney – A legal document that authorizes another person to act as your “agent” on legal matters. These documents can be limited in scope to specific legal acts.
  • Designation of Beneficiaries on “Payable on Death” Accounts – A legal designation that allows for the immediate distribution of investments while still avoiding the probate process.

Making a Plan to Face the Uncertainties of COVID-19 and Life

Facing the uncertainties of life can feel challenging, now more so than ever. But you can hope to find some peace of mind in the COVID-19 era and beyond with a proper estate plan in place. Your family will also benefit from your efforts as this time because they won’t be strapped with added burdens while also grieving your loss. Be sure to contact the attorneys at Loshak Law PLLC by phone at (954) 334-1122 when you are ready to establish or review your very own estate plan.

Ancillary probate involves real estate and other personal property that a decedent leaves behind in a state other than where they lived at the time of their death. The probate process can be complex and time-consuming, even when all of the property is in one state.

If you are handling ancillary probate administration in Florida, you will need an experienced probate attorney. To learn more about the ancillary probate in Florida, contact Loshak Leach, LLP.

Understanding Ancillary Probate in Florida

Perhaps an individual lives in Massachusetts but owns a condo in Florida. In that case, the primary probate process will take place in Massachusetts. However, the Massachusetts probate courts will not have authority over the condo in Florida.

In this case, the decedent’s estate administrator will need to initiate a second probate process. Other types of property may also be part of the ancillary probate, including boats or cars with Florida titles.

The Ancillary Probate Process

Florida law governs ancillary probate under Florida Statute 734.102. This process applies when a non-resident of the state dies and leaves behind:

  • Property
  • Other assets
  • Liens on any property in Florida
  • Debts that a Florida resident owes them

A personal representative for the property located in Florida will need an ancillary letter regarding the estate. In many cases, the estate planning documents will not list a representative for the Florida property. When this happens, an out-of-state individual named as a representative will have to administer the Florida probate. The representative will have to comply with and qualify under Florida law for this process.

If there are no terms regarding an estate representative in the decedent’s estate plan, the court will name a personal representative pursuant to Chapter 733 of the Florida Probate Code. This scenario would occur if the decedent never drafted a will.

Formal and Summary Administration 

There are two main probate administration processes. A Formal Administration usually applies if the decedent has been dead for two years or less and when the value of the probate estate exceeds $75,000. The steps involved will include the court appointing a representative, notification to creditors, and publication of the probate in the newspaper.

The other probate process is Summary Administration. This proceeding is less involved and apply in cases where the value of the estate is under $75,000. The beneficiaries of the estate will need to agree to the summary probate. If those beneficiaries do not agree, the estate will go through formal administration. Also, if the decedent owed debts, or if the administrator cannot identify all of the assets in Florida, the probate process will need to be a more involved formal administration.

Summary administration requires that the representative share an authenticated copy of the probate administration from the decedent’s home state. That documentation should include any wills, trusts, beneficiaries, and other information regarding the property located in Florida.

In cases where a creditor notifies the estate regarding a claim, the estate will go through a traditional ancillary probate process to resolve those debts. Frequently, no creditors will appear, and the administrator will be able to distribute the property to the named beneficiaries.

Creditors have only two years to file claims against a deceased individual’s estate under the applicable statute of limitations. After the two-year period, a larger estate, such as those worth more than $75,000, can go through a summary administration process. Because summary administration is faster and simpler than formal administration, it is also less expensive. When possible, you should opt for summary administration rather than formal administration because it is an excellent way to save time and resources.

Can You Avoid Ancillary Probate?

Ancillary probate can increase the costs of probate administration significantly. Not only will the process increase court-related costs, attorney fees, and other expenses, but it will also draw out the probate and require additional time and energy to complete. There are ways that you can prevent the need for ancillary probate.

Creating a detailed estate plan can avoid ancillary probate through the use of a trust. If you wish to create a living trust, you can title your out-of-state property under the name of the trust. These assets will go straight to beneficiaries rather than through the probate process. The trust can hold any property, in your state or out of state, and all of it will bypass probate, therefore, saving your beneficiaries time, stress, and money.

Drafting a trust and other estate planning documents will help your loved ones manage any estate property and save assets at the time of your death.

Speak to an Experienced Ancillary Probate Administration Lawyer 

Ancillary probate is a complicated process. An attorney can help you navigate the probate administration process in Florida. Contact the experienced ancillary probate lawyers at Loshak Law PLLC today to discuss your case by calling (954) 334-1122.

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