Litherland, Kennedy & Associates, APC, Attorneys at Law

Trustor’s Intent is Paramount All states require that a Will or a Codicil to a Will be in writing and witnessed (unless the Will is a holographic Will, which means it is entirely in the handwriting of the Testator (creator of the Will)).  Florida additionally requires that all testamentary directives in Wills and Trusts be in writing and witnessed. Florida Statutes Section 736.0405(2)(b). Most states do not require that a trust or an amendment to a trust be witnessed. However, because a trust is … [Read more...] about Trustor’s Intent is Paramount

“Can We Talk” . . . About Estate Planning for Pets and People Two celebrities, Joan Rivers and Lauren Bacall, died recently. Both died very wealthy women and their heirs will be well cared for. However, each provided for their loved ones in very different ways. Because Joan Rivers had a living trust, much of the details of her estate plan are unknown. Living Trusts are not filed with the probate court after death, unlike a Last Will and Testament. In most locations, anyone can access a Will and … [Read more...] about “Can We Talk” . . . About Estate Planning for Pets and People

Federal Court: Disclaimed Property Available to Pay Tax Lien Audrey Deinlein had three adult sons, Christopher (“Chris”), Ronald Jack, Jr. (“Jack”), and Paul. At the time of her death, she owned a condominium in Kentucky with a value of $303,000. The condominium had a mortgage of $104,352. After her death and before the property’s sale, Jack and Paul had made payments reducing the mortgage balance to $87,936. The net proceeds after the sale were $198,339.56. For many years, Chris had problems … [Read more...] about Federal Court: Disclaimed Property Available to Pay Tax Lien

With the rise of companies such as Legal Zoom, TotalLegal, LawDepot, and DoYourOwnWill.com, more and more consumers are attempting to create their own estate plans without the assistance of a lawyer. While it is possible to create a simple Will or other legal documents with the assistance of any of these companies or others, doing so can often lead to unintended results. Ann Aldrich, a resident of Florida, created her own Will in 2004 using an E-Z Legal Form preprinted Will. The Will listed all … [Read more...] about Do-It-Yourself Estate Plans: Unintended Results

In 1994, Elwood Olsen created a revocable living trust to hold his separate property and his half of the joint property. That same year his wife, Grace Olsen, created a revocable living trust to hold her separate property and her half of the joint property. At death, Elwood and Grace’s trusts were to divide into three sub-trusts, Marital Trust A, Marital Trust B, and a Family Trust. The Family Trust was to contain the amount of trust assets that could pass free of estate tax at death. The … [Read more...] about Failure to Divide Trust Cost over $400,000

The federal government and each state have a list of assets that are protected under the bankruptcy code. Every state protects personal residences.  Some states offer virtually unlimited protection and other states only protect a modest amount of equity in the home. The amount of protection for qualified retirement plans governed by ERISA (Employee Retirement Income Security Act) and contributory IRAs is also defined by both federal bankruptcy law as well as state laws. An area of controversy … [Read more...] about Supreme Court Rules on Bankruptcy Protection of Inherited IRAs

A “new” federal tax was passed to help pay for the cost of the Affordable Care Act. This tax has been in effect since January 1, 2013. The tax is an additional 3.8% tax on “net investment income.” Net investment income (“NII”) is the income received from investment assets such as bank accounts, bonds, stocks, mutual funds, loans, and other investments. This would include interest, dividends, annuities, royalties, and rents which are not derived in the ordinary course of trade or business. NII … [Read more...] about Benefit Charity and Save Taxes Too

Over the past fifteen years, the amount that could pass free of estate tax at death has ranged from $675,000 to an unlimited amount. Prior to 2010, if the first spouse to die did not utilize his or her estate tax exclusion amount, that amount would be lost forever. Special estate planning, usually in the form of an A/B or A/B/C Revocable Trust was needed in order to utilize the exemption amount of the first spouse to die. In a joint trust, the A Trust is most often referred to as the Survivor’s … [Read more...] about IRS Grants Relief for Late Election of Portability

In the case In re Estate of Karter Wu (Supreme Court of Queensland, Australia), Mr. Wu created and stored his Last Will and Testament on an iPhone, along with a series of other documents, most of them final farewells. Wu’s iPhone Will named an executor and successor, set forth how he wished to dispose of his assets at death, dealt with his entire estate, and authorized the executor to deal with his financial affairs. The Will began with the words “This is the Last Will and Testament of Karter … [Read more...] about The Case of the iPhone Will

Not much more than a decade ago, taxpayers would flock to estate planning seminars to learn about ways to reduce or eliminate the federal estate tax. With the rise of the federal estate tax applicable exclusion amount (the amount that can pass free of estate tax) to $5,340,000 ($10,680,000 for married couples) in 2014, fewer than two out of every thousand deceased individuals will pay a federal estate tax. Many more estates, however, will be subject to a state estate or inheritance tax. For … [Read more...] about A New Paradigm: Planning for State Estate Taxes