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Did You Recently Move to Florida? You Need to Update Your Estate Plan!

Did You Recently Move to Florida? You Need to Update Your Estate Plan!

Over the previous decade, nearly three million people have moved to Florida. From affordability to no income tax, the Sunshine State maintains an alluring lifestyle, with plenty to offer beyond pleasant weather. 

Yet, when relocating, people frequently forget to review their estate planning documents. Since laws vary from state to state, there are no guarantees your current documents will fulfill the requirements of your new home. 

If you are moving to Florida, you should execute your Estate Planning documents according to its state laws.

 5 Reasons to Update Your Will and Trusts When You Move to Florida

1. Reduce Property Tax

Homestead laws are designed to protect the value of a home from property taxes, creditors, and circumstances that arise from the death of a homeowner’s spouse. 

Floridian homeowners who register their property as a “homestead” receive tax breaks. You can reduce the taxable value of your primary home by as much as $50,000, saving roughly $750 per year. 

Moreover, when granted a homestead exemption, your home’s assessed value may not increase more than 3% annually. 

In short: Changing your domicile to Florida reduces the property taxes you’re expected to pay. 

To qualify you must meet the following requirements: 

  • Be the property owner; 
  • The property must be your permanent residence; or
  • The property should be the permanent residence of someone you can claim as a dependent on your taxes; 
  • You have not rented the property for more than 30 days in a given calendar year; and
  • You are a US citizen or have a Permanent Residence Card. 

2. Shelter Assets

On July 1, 2022, the Florida legislature passed a new trust law allowing one spouse to create a Spousal Lifetime Access Trust (SLAT). This type of irrevocable trust is where one spouse makes a gift into a Trust to benefit the other spouse (and potentially other family members) while removing assets from their combined estate. 

SLATs are inexpensive and flexible lifetime Estate Planning tools used to shelter assets. Generally, they are not taxable because the donor spouse uses their federal gift and estate tax exclusion when transferring assets to a SLAT. 

They are especially advantageous because your spouse can receive trust distributions as a beneficiary, which they may use for your joint support and maintenance as needed.

3. Validate Power of Attorney 

Power of Attorneys created in other states should be valid in Florida. However, third parties, like banks or healthcare organizations, for example, may request an opinion of counsel concerning the power’s validity, at the principal’s expense, before accepting it. 

The reason can be as simple as unfamiliarity with your state’s documentation, which creates unnecessary delays. These hindrances can be a real pain in time-sensitive situations when you’re selling property or doing Medicaid planning. Hence, if you move to Florida, we recommend drawing up a Power of Attorney under Florida Law. 

4. Ensure Smooth Estate Settlement

Just like Power of Attorney, in most cases, a Will from another state is presumed valid. Yet, if your Will is contested, your heirs will have to prove its validity using an expert legal witness from your previous state, which can be costly. 

This entails the witness signing an oath in the presence of a deputy clerk of a Florida court or a notary commissioned by the Florida probate judge. They basically certify you executed the will with proper legal formalities and were competent at the time. 

Now, imagine the administrative nightmare if this witness is no longer alive? 

Therefore, it’s significantly less hassle to draw up a new Will under Florida Law, which you’re required to sign in the presence of at least two competent witnesses. 

5. Avoid Unnecessary Trust Taxes

A revocable Living Trust helps you effectively pass your assets to your loved ones by distributing them immediately following your death. This avoids a long, stressful and expensive probate court process. 

Those who don’t have a Living Trust, should certainly set one up. If you do have a revocable Trust, its situs (the physical site where it was drawn up) determines which state holds jurisdiction for tax purposes.  

Florida holds no state income tax, no estate tax and no inheritance tax. Thus, its laws are possibly more advantageous than the state you moved from. Moreover, if you don’t change your Trust’s situs, it can be taxed by your previous state.

Talk To A Florida Estate Planning Attorney

Making updates to your Estate Planning documents can be simple; other times, it’s more complex. When moving to Florida, it’s also an excellent time to confirm the viability of your end-of-life medical documents like Advance Medical Directives. 

Hiring a Florida Estate Planning Attorney ensures your Trusts, Will, Durable Power of Attorney, Living Will, and Health Care Directives are properly taken care of. Exercising the necessary precautions now will not only give you great peace of mind but also spare your loved ones from avoidable legal entanglements and potential conflict.  

Contact the Siegel Law Group today at 561-556-7975 for a complimentary consultation, and speak with a qualified and trusted Estate Planning Attorney who can help you choose the best option for your future needs. It may not be possible to anticipate everything that could take place as you age, but with the right legal support it’s much easier to consider the most significant factors. Those factors can then be mitigated as much as possible, allowing you to age without worry, and focus on all the things you enjoy instead of worrying about future decisions.

 

Barry Siegel is the founder and managing partner of The Siegel Law Group, P.A., a Law Firm in Boca Raton, Florida that focuses on comprehensive Estate Planning and Elder Law Planning for clients throughout South Florida. The Siegel legal team is dedicated to providing compassionate counsel and effective legal representation in matters pertaining to Estate Planning, Elder Law, Probate and Trust Administration, Asset Protection Planning, and much more. Subscribe to our newsletter for the most current legal news and updates.

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