What everyone should know about Probate.

Probate and the courtsProbate is a court-supervised process for identifying and gathering the assets of a deceased person (decedent), paying the decedent’s debts, and distributing the decedent’s assets to his or her beneficiaries. In general, the decedent’s assets are used first to pay the cost of the probate proceeding, then are used to pay the decedent’s outstanding debts, and the remainder is distributed to the decedent’s beneficiaries.
There are two types of probate administration under Florida law: formal administration and summary administration. There is also a non-court supervised administration proceeding called “Disposition of Personal Property Without Administration.” This type of administration only applies in limited circumstances. For more information about Probate Administration, Wills and Intestacy please contact BaskinFleece at 727.572.4545

 

This blog is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Some of the content of this information is courtesy of The Florida Bar and represents general legal advice. Because the law is continually changing, some provisions in this blog may be out of date. It is always best to consult an attorney about your legal rights and responsibilities in your particular case.

Probate and Trust Administration Challenges

Trust Administration
BaskinFleece handles all aspects of probate and trust administration.
 
Trust administration is that process whereby assets and cash which were funded into a revocable or irrevocable trust during the decedent’s lifetime or “poured into the trust after his or her passing”, are marshaled/gathered and made ready for distribution to the beneficiaries named in the trust. Trust administration also requires the filing of a notice of trust with the probate court and is the process whereby creditors are paid, and after all state and federal tax returns are filed and all creditors and other administrative expenses are paid, the trustee makes a final distribution of the trust assets and cash. The process is similar to Florida probate administration, but there is no circuit judge supervising the administration, nor is a fiduciary bond usually posted, and many times it can be accomplished more efficiently, and thereby cheaper and faster, than a full probate administration.


trusts and ProbateMany of the same contested issues in a probate estate also exist in trust matters.
 
The main difference is that an independent civil action needs to be filed in order to invoke the jurisdiction of the court and have summonses issued to the Defendants. As Florida trust administration is not court supervised, it is up to the beneficiaries, rather than the probate judge, to make sure the trustee is discharging his duties in accordance with the trust terms and with the law. For the most part the only way a beneficiary can review what the trustee has done is through the annual accounting Estate expenses: The personal representative’s compensation is usually determined in one of five ways:which the trustee must provide each qualified beneficiary every year. If the accounting is not provided, the trustee has breached his fiduciary duty to keep beneficiaries informed, which could result in litigation. There are many other fiduciary duties imposed upon a trustee which, if violated, subject the trustee to removal, surcharge or other remedies imposed by the courts. Our lawyers have handled a variety of wills and trust litigation in the courts of Tampa, St. Petersburg, Clearwater and throughout Florida.

BaskinFleece lawyer Jay Fleece

Attorney Jay Fleece

BaskinFleece handles cases from the pre-suit stages, including mediation, all the way through trial, both jury and non-jury, and even at the appellate level, if necessary. The main focus of the firm in dealing with all controversies is the client. Cost, emotional impact and timeliness are all important to the client and the firm strives for an end result which leaves the client feeling that justice was accomplished. For help or answers to estate-related questions, you can contact BaskinFleece at 727.572.4545.

 

This blog is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Because the law is continually changing, some provisions in this blog may be out of date. It is always best to consult an attorney about your legal rights and responsibilities in your particular case.

When does a trust terminate and the assets distributed to the beneficiaries?

BaskinFleece lawyer Jay Fleece

By Attorney Jay Fleece

In Florida, a common estate planning scenario is for someone to create a revocable trust, sometimes referred to as a “Living Trust” and place all or most of his or her assets into the trust. The Settlor, the one setting up the trust, is typically named the initial trustee and deals with the trust property in the same fashion as if the assets were still owned by and in the name of the Settlor, with the absolute right to amend or revoke the trust and without having to account to any beneficiary.

Upon the death of the Settlor, everything changes. As the Settlor can no longer amend the trust, it becomes “irrevocable” at which time the beneficiaries named in the trust become established or vested.

Living TrustMany of these “Living Trusts” are set up to provide that upon the death of the Settlor the trust terminates and distribution is made of the trust assets to the named beneficiaries, similar to a will, but without court supervision.

Before anything can be done with the assets in a Living Trust which terminates after the death of the Settlor, a successor trustee must assume the trusteeship of the trust. Typically, the Settlor has identified and nominated someone – someone highly trusted – to be the successor trustee to take over the trust upon the Settlor’s death. Many times, a Trust Company is named as the successor trustee. The nominated successor trustee should immediately engage an attorney to guide him or her through administering a trust.

Trustee has 60 days

The Florida Trust Code then requires that a successor trustee, within 60 days after finding out that a formerly revocable trust has become irrevocable (which usually means within 60 days of the Settlor’s death), to give notice to the beneficiaries of the trust’s existence, the identity of the Settlor or Settlors, the right to request a copy of the trust instrument and the right to accountings under that section of the Code.[i]

Once the successor trustee is in place to discharge the duties as trustee, are the assets then immediately distributed to the beneficiaries named in the trust? The answer is usually no even though the successor trustee is under a fiduciary duty to make distribution when the trust terminates.

Trustee an TrustThe termination date of a trust means the time at which it becomes the duty of the trustee to wind up administration of the trust. “The period for winding up the trust refers to the period after the termination date and before trust administration ends by complete distribution of the trust estate”.[ii]

Following a trust’s termination date, the trustee has a duty within a reasonable time to distribute the trust property to the persons entitled to it, and to make preliminary distributions as appropriate within the windup period.[iii]  The Florida Trust Code provides that the successor trustee shall proceed expeditiously to distribute the trust property to the persons entitled to the property, subject to the right of the trustee to retain a reasonable reserve for the payment of debts, expenses, and taxes.[iv]  The Code also provides that on termination of the trust, the successor trustee continues to possess the powers appropriate to wind up the administration of the trust and distribute the trust property to the persons entitled to the property, subject to the right of the trustee to retain a reasonable reserve for the payment of debts, expenses, and taxes.[v]  Many practioners refer to this period between the Settlor’s death and final distribution as the “windup” period, or the “windup” trust.

The common law is clear that a successor trustee’s powers and duties do not end on the trust’s termination but continues for a reasonable amount of time to wind up the administration of the trust prior to making distribution in a manner consistent with the purposes of the trust and the interests of the beneficiaries.[vi]

Living trust wind up periodWhat is a reasonable amount of time to wind-up the administration of a trust and make distribution? This question has no clear answer as each case is different depending on the assets held in the trust, whether those assets are easily valued and distributable and determining and satisfying any trust obligations including any tax liabilities. Each trust would be judged by the facts unique to its administration. There should be a legitimate reason for the trustee to have a long “windup” period, other than wanting to collect additional fees and remain in control of the trust assets. On the trust’s termination, the assets belong to the beneficiaries only subject to the “windup” period.

As part of the wind-up process, the successor trustee should provide a final accounting which should include a plan of distribution for any undistributed assets shown on the final accounting.[vii] The successor trustee cannot be held liable for not making distributions before the expiration of the six-month limitation period within which beneficiaries can challenge the final accounting, provided the beneficiary receives a limitations notice with the final accounting. The beneficiaries can always waive the six-month period by approving the accounting and releasing the successor trustee from liability as providing a final accounting is the only mechanism available to the trustee to determine and limit liability. As an alternative, the trustee may request judicial approval of the accounting but this procedure would invariably take longer than six months and be an unnecessary expense to the trust.

When these “Living Trusts” terminate upon the Settlor’s death, a successor trustee whoTrust in Tampa and St. Petersburg fails to distribute assets and bring the trust administration to a conclusion in a timely fashion after the death of the Settlor has committed a breach of fiduciary duty and can be held accountable.[viii]

The breach of the fiduciary duty to timely make distribution is usually not done in isolation but typically involves other breaches committed by the successor trustee, including failing to provide an annual accounting and either mismanaging the trust assets or using those assets for his or her own benefit.


[i] Fla. Stat. §736.0813(1)(b).
[ii] 89 Restatement of The Law on Trusts 3d, comment b.
[iii] 89 Restatement of The Law on Trusts 3d, comment (e).
[iv] Fla. Stat. §736.0817
[v] Fla. Stat. §736.0816(25)
[vi] Restatement of the Law Third, Trusts §89; Bogert’s The Law of Trusts and Trustees §1010.
[vii] Fla. Stat. §736.08135(2)(f)
[viii] DeBello v. Buckman, 916 So.2d 882 (Fla. 4DCA 2005)


This blog is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Because the law is continually changing, some provisions in this blog may be out of date. It is always best to consult an attorney about your legal rights and responsibilities in your particular case.

Wills, Probate and Trusts: How Property Passes on Death

BaskinFleece lawyer Jay Fleece

By Attorney Jay Fleece

When a person dies, their assets, be it real estate, bank accounts, stocks, bonds, jewelry, automobiles or whatever else they may own must pass to someone legally entitled to those assets. There are three basic ways property passes on death. Each way depends on how the particular asset is owned or titled at the time of death.

Probate

If someone owns an asset in their individual name at the time of death, that asset should pass to the beneficiaries specified in the decedent’s will. If the decedent did not have a will, then the Assetsdecedent’s property will pass under the laws of intestacy. In other words, the state of Florida decides how your assets will be distributed. This does not mean all of the decedent’s property passes to the state, but rather to individuals based on their relationship to the decedent.

Florida statutes 732.102 and 732.103 set forth the statutory scheme for intestate succession. For example, if an individual dies without a will and is survived by a spouse and children of that marriage, then the surviving spouse is entitled to the first $60,000.00 of assets and anything over that amount is equally divided between the surviving spouse and the children.

When property passes under the terms of a last will and testament or by intestate succession, the process by which this transfer is accomplished is called probate. Probate is a court supervised process whereby a decedent’s property is transferred in an orderly fashion to those legally entitled to the assets.

Living wills and trustsTrusts

Some people elect to create a revocable “living” trust during their lifetime. In such a case, certain assets are transferred to the trust and retitled  in the name of the trust. The individual creating the trust, called the “Grantor,” has full power to change, modify and revoke the trust during his or her lifetime. After the death of the grantor, these trusts become irrevocable and the trust property is disposed of in accordance with the terms of the trust. This type of trust, called a “Grantor Trust,” often contains language very similar to language used in a last will and testament, which specifies how and to whom the decedent’s property will pass. A trustee named in the trust document would then have the responsibility of distributing the trust assets in accordance with the terms of the trust. Administration of a trust is similar to the probate process but is not subject to court supervision.

contractual provisionsContractual Provisions

Assets governed by contractual provisions pass outside the probate and trust administration process. Instead, these assets pass directly to the recipients designated in the contract governing the asset. The most prevalent type of asset that passes by contract is joint bank accounts. Typically a bank account titled in two or more names will pass to the surviving owners of the account. Other assets governed by contractual provisions include payable on death accounts, and accounts “held in trust for.”  Payable on death accounts are frequently referred to as “Totten Trusts.” Other forms of contractual arrangements that pass property directly to a named beneficiary include life insurance policies, retirement accounts and annuities.

Screen Shot 2016-08-29 at 9.36.32 AMWhy you should engage in estate planning

While each of these areas are discussed in greater detail in other articles, this basic outline should illustrate how important it is to make sure that you understand how your assets are titled and how they will pass on death. The unintended consequences of improperly titling your assets could have a devastating effect on your estate plan. For those with substantial wealth, estate planning from a tax perspective can save on income and estate taxes.

This blog is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Because the law is continually changing, some provisions in this blog may be out of date. It is always best to consult an attorney about your legal rights and responsibilities in your particular case.

How Property Passes on Death

Probate, estate planning

When someone dies, their property, be it real estate, bank accounts, stocks, bonds, jewelry, automobiles or whatever that person owns must pass to someone legally entitled to those assets. There are three basic ways property passes on death. Each way depends on how the particular asset is owned or titled at the time of death.

1. Probate. If someone owns an asset in his or her own name at the time of death, that asset should pass to the deceased beneficiaries that are specified in his or her will. If the decedent did not have a will, then the property owned by the decedent will pass under the laws of intestacy. In other words, the state of Florida makes a will for the decedent. This doesn’t mean all of the decedent’s property passes to the state but rather to individuals depending on their relationship to the decedent.

InheritanceFlorida statutes 732.102 and 732.103 set forth the statutory scheme for intestate succession. For example if a man dies without a will but is survived by a spouse and children of that marriage, then the surviving spouse is entitled to the first $60,000.00 of assets and anything over that amount is equally divided between the surviving spouse and the children.

When property passes by the terms of a last will and testament or by intestate succession, the process by which this transfer is accomplished is called probate. Probate is essentially a court supervised process whereby a decedent’s property is transferred in an orderly fashion to the ones legally entitled to those assets.

Living trusts2. Trusts. Some people elect to create a revocable “living” trust during their lifetime. Here, the trust assets are typically titled in the name of the trust. The grantor, the one creating the trust, has full power to change, modify and revoke the trust during his or her lifetime. After the death of the grantor, these trusts usually terminate and the disposition of the property held in the trust will be governed by the terms of the trust. These type of trusts typically contain language very similar to language used in a last will and testament, which specifies how and to whom the decedent’s property will pass. A successor trustee named in the trust document would then have the responsibility of effectuating the terms of the trust and to make sure the intended beneficiaries receive what the decedent intended. The administration of the trust is also similar to the probate process but is not subject to court supervision.

Attorneys are best to handle assets from a trust3. By contractual provisions. Assets subject to contractual provisions pass outside the probate process and the trust process. These assets pass directly to the recipients designated in the contract that governs that asset. The most prevalent type of asset that passes by contract would be a joint bank account. Typically a bank account titled in two or more names will pass to the survivor. Other type of contractual bank accounts include the payable on death account, or the “held in trust for …” account, a Totten trust as these types of accounts are sometimes called. Other forms of contractual arrangements which pass property directly to a named beneficiary include life insurance policies, retirement accounts and annuities.

BaskinFleece lawyer Jay Fleece

Attorney Jay Fleece

Why someone should engage in estate planning. While each of these areas are discussed in greater detail in other articles, this basic outline should illustrate how important it is to make sure that you understand how your assets are titled and how they will pass on death. The unintended consequences of improperly titling your assets could have a devastating effect on your estate plan. For those with substantial wealth, estate planning from a tax perspective can save on income and estate taxes.

To schedule an appointment with a BaskinFleece attorney, call (727) 572-4545. For more information about BaskinFleece, visit www.BaskinFleece.com.

This blog is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Because the law is continually changing, some provisions in this blog may be out of date. It is always best to consult an attorney about your legal rights and responsibilities in your particular case.

April 1st – This Day in History

1789 Politics: The first U.S. House of Representatives formed and elected its first speaker.

April 1st US troops land on Okinawa1945 WWII: On this day, 50,000 U.S. combat troops of the 10th Army landed on Okinawa, 350 miles south of Kyushu, the southern main island of Japan.

The 1985 NCAA Men's Division I Basketball Tournament1985 College Basketball:
One of the greatest upsets in college basketball history, the Villanova Wildcats beat the Georgetown Hoyas, 66-64, to win the NCAA Men’s Division I tournament. The victory was Villanova’s first-ever national championship. Patrick Ewing played center on the losing Georgetown team.

Google introduces email2004 Internet: Google’s Gmail was launched as an advertising-supported email service provided by Google on an invitation-only beta release.

Jay Fleece and Hamden BaskinApril 1, 2004 Law: Joseph W. “Jay” Fleece, III, and Hamden H. Baskin, III, decided to combine their extensive knowledge and experience to create a unique law firm that was focused mainly on contested estate, trust and guardianship matters. Their philosophy was simple: leverage trial skills with the knowledge of probate and trust law to provide consistent, efficient and effective representation for their clients – resulting in positive outcomes. Congratulations to Jay Fleece, Hamden Baskin and their team for serving the community and its clients since 2004.

You can contact BaskinFleece at 727.572.4545.

Trusts and Probate: Advantages and Disadvantages

What are the differences between probate and trusts? Probate is a court-supervised process for identifying and gathering the assets of a deceased person (decedent), paying the decedent’s debts, and distributing the decedent’s assets to his or her beneficiaries. In general, the decedent’s assets are used first to pay the cost of the probate proceeding, then are used to pay the decedent’s outstanding debts, and the remainder is distributed to the decedent’s beneficiaries.

Jay Fleece, of Baskin Fleece, points out the differences, advantages and disadvantages of Probate and Trusts.

Jay Fleece, of Baskin Fleece, points out the differences, advantages and disadvantages of Probate and Trusts.

Jay Fleece, of BaskinFleece, points out the differences, advantages and disadvantages of probate and trusts.
To start the video, please click the image to the left.

probate trusts advantages of eachBaskinFleece primarily deals with controversies involving estates, trusts, wills, probate trusts and guardianships. Issues dealing with the validity of wills and trusts, breach of fiduciary duty, lack of capacity, spousal rights, creditors’ rights and anything related to wills, trusts and guardianships are routinely dealt with. The vast experience in dealing with and resolving these specific issues has given the firm a wealth of knowledge – which other less-involved firms may not have. It is that knowledge base that sets BaskinFleece apart from the other firms and attorneys practicing in this area of the law.

BaskinFleece handles cases from the pre-suit stages, including mediation, all the way through trial, both jury and non-jury, and even at the appellate level, if necessary. The main focus of the firm in dealing with all controversies is the client. Cost, emotional impact and timeliness are all important to the client and the firm strives for an end result which leaves the client feeling that justice was accomplished. For help or answers to estate-related questions, you can contact BaskinFleece at 727.572.4545.

This blog is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Because the law is continually changing, some provisions in this blog may be out of date. It is always best to consult an attorney about your legal rights and responsibilities in your particular case.