Estate Planning and Documents

Does ingesting medical based pot make you incapable of creating a will or trust?

July 12, 2016 | by Chepenik Trushin LLP

Possibility of the Effect of Marijuana on Estate Planning

In the 2014 legislative session, the Florida Legislature passed the Compassionate Medical Cannabis Act of 2014, which authorizes certain physicians to prescribe low-THC cannabis for use by specified patients. Nearly two years later, due to legal challenges, Floridians still have not been able to receive this medical treatment. However, because the law may become effective in the near future, certain questions must be addressed, particularly questions regarding the intersection of marijuana use and testamentary capacity.

One of the legal prerequisites for making a will in Florida is that the maker (the testator) must have testamentary capacity, that is, a sound mind. Insofar as lack of testamentary capacity is one of the grounds frequently used to challenge the making and execution of a last will and testament, the testator’s testamentary capacity may be called into question if he or she had been prescribed medical marijuana and had, in fact, taken medical marijuana during any aspect of the preparation or execution of the subject will.

Settlor’s, Trustee’s and Beneficiary’s – Meet your “Jedi Knight”, Trust Protector

June 30, 2016 | by Chepenik Trushin LLP

Trust Protectors: An Extra Layer of Protection

Traditionally, a trust has three main participants, a settlor, a trustee, and one or more beneficiaries. A settlor creates and/or contributes property to the trust. A trustee manages and holds the property in the trust for the benefit of other people who are said to have a “beneficial interest” in the trust. Beneficiaries are the people who have those beneficial interests. For example, a father, acting as a settlor, might create a trust, naming his wife as the trustee, to distribute money for the benefit of their children, who are the beneficiaries of the trust. However, a fourth participant has increasingly been used in trusts: the trust protector.

Historically, trust protectors were mainly used in offshore trusts and rarely in domestic trusts. A trust protector acts as an extra layer of protection for the settlor. A trust protector is customarily appointed to supervise the trust and ensure that the settlor’s intent is effectuated. A trust protector may have the power to modify terms of a trust to ensure that the settlor’s intent is carried out.

B.B. King, a music legend – Undue Influence and Capacity in real life

June 24, 2016 | by Chepenik Trushin LLP

B.B. King Estate Fight: One Year Later and No End in Sight

Legendary blues musician B.B. King passed away on May 14, 2015 due to congestive heart failure at the age of 89. In a will created in 2007, King named his longtime business manager, Laverne Toney, as the executor/personal representative of his will. The 2007 will, thus, puts Toney solely in charge of administering King’s assets, his property, and his trust. In June 2015, a Las Vegas judge confirmed Toney’s appointment as sole executor, and rejected efforts to contest the will made by four of Mr. King’s children.

Although B.B. King did not have children from either of his two marriages, he nevertheless claimed to have 15 children with 15 different women over the course of his lifetime. Confusing the situation still further, King’s doctors determined in the 1980’s that due to King’s low sperm count, he was not able to conceive children. However, King never disputed paternity, and claimed to be the father of all 15 children, 11 of whom are still alive and have been fighting Toney over the estate.

Personal representative designation in Last Will and Testament – Convicted Felons

June 20, 2016 | by Chepenik Trushin LLP

Florida Limitation on Convicted Felons Serving as Personal Representatives in Probate Administration

When contemplating preparing a last will and testament, there are many options that have to be considered before drafting can begin. One important consideration is deciding who to nominate as the personal representative of your estate.

A personal representative is a fiduciary who is appointed by the court to administer the decedent’s estate.. Depending on the jurisdiction, a personal representative may also be known or referred to as an executor, administrator, or other name. Florida Statute § 733.301 outlines who has preference in appointment as the personal representative in various scenarios. When the decedent dies testate, meaning with a last will and testament, preference is given to the personal representative nominated in the will. If the nominated personal representative is unwilling, unable or unfit to serve, any successor nominated in the will has preference. In the event all nominated personal representatives are unwilling, unable or unfit to serve, preference goes to the person selected by a majority in interest of the persons entitled to the estate. If there is no person selected by a majority, preference goes to a beneficiary under the will, and if more than one beneficiary applies, the court may select the person best qualified.

When Wills mean Business

June 14, 2016 | by Chepenik Trushin LLP

When Wills Mean Business: Planning for Your Business’s Future

Planning for the future is not only necessary in your personal life, but also in your professional life, especially if you either own a business or invest in a business. Putting an estate plan in place early on, and keeping it updated to reflect changes in the business, can protect your business in the event of your death. Two South Florida examples illustrate the necessity of planning ahead for your business.

In November 2015, Pebb Enterprises LLC, based in Boca Raton, suffered the loss of two of its managing principals and five employees in an airplane crash. The plans put in place by the principals kept the company in business after the devastating event. In contrast, after the death of its president, Naples based Vantage Lighting was undervalued and dissolved, because the president died without a will.

What Happens when one Executes a Will in Two Different Countries, with Different Beneficiaries?

June 3, 2016 | by Chepenik Trushin LLP

The United States is famously known for its influx of immigrants moving here to build their lives, to retire, and for various other reasons. But specifically, tropical and sunny Florida is a very popular place for those coming from other countries. A booming 129,525 people moved to Florida from other countries just this past year! It is very common for people to own property in both their native home, as well as here in the United States.

As people build their lives, it is very important to plan what will happen after death to property both in the U.S. and abroad. This especially became important for Elena Isleno, a citizen of Argentina. Ms. Isleno owned property both in Argentina and in Florida. In order to protect her assets and decide what should be done with her properties, Ms. Isleno executed a will in New York; certain property went to friends and family in Argentina, while others to friends and family in the United States.

Adult Adoptions as an Estate Planning Tool

May 20, 2016 | by Chepenik Trushin LLP

Many people utilize a will, a trust, or some other standard form of estate planning to ensure that their loved ones are provided for upon their death. However, in Florida, individuals have an additional estate planning tool: adult adoptions. Under Florida Statute § 63.042, a husband and wife, an unmarried adult, or a married person without the other spouse joining as a petitioner may adopt an adult. The statute does provide certain limitations, for example, if a married person wants to adopt without the other spouse joining as a petitioner, then the non-joining spouse must consent to the adoption. However, a court can excuse this requirement. Generally, Florida’s adoption statute is less restrictive than similar statutes in other states because it does not impose the common age difference requirement. Under this requirement, there must be a certain age difference between the party being adopted and the party wishing to adopt in order for the adoption to be legal. This means that in Florida an adult is able to adopt another adult regardless of age.

The Truth about Living Trusts

May 13, 2016 | by Chepenik Trushin LLP

Many people, especially the large elderly population in South Florida, are targeted by various entities offering assistance and guidance in estate and financial planning. The sale of living trusts is a profitable business, and salespeople will target elderly individuals in need of financial planning. These salespeople will hold seminars, provide free food, and lecture attendees on the benefits of living trusts. However, there is an abundance of important information about living trusts that these salespeople will not tell you. It is important to be aware of your options, because living trusts are not the right financial or estate planning tool for everyone.

A living trust, like a will, is a legal document that allows you to direct what happens to your property after your death. Living trusts are revocable. This means the creator of the trust can change or cancel provisions of the trust. There are three key players with regard to living trusts: (1) the creator of the trust (the grantor); (2) the person or entity that manages the assets in the trust (the trustee); and (3) the person or persons who receive the distributions or property from the trust (the beneficiary). Often, a person will create a living trust and make himself or herself the trustee and the beneficiary for as long as he or she is alive. Living trusts are especially beneficial to people who designate beneficiaries with special needs, people who own property in more than one state, and people who are worried that they may become disabled and subject to undue influence. People will also utilize living trusts because they are not subject to probate, or the court proceeding which administers the assets of the deceased person, which can be extensive and costly to the estate.

Supplemental Needs Trusts: Providing for Your Special Needs Beneficiary While Preserving His or Her Public Benefits

May 5, 2016 | by Chepenik Trushin LLP

Planning for the future care of a special needs beneficiary, especially if that beneficiary is your child, can be difficult and overwhelming. There are many facets to consider, chief among them: upon what assets will the special needs individual rely after you have passed if you have been his or her main source of support (and especially if the special needs individual suffers from a disability that prevents him or her from working)?

Consider this: leaving your assets to a special needs beneficiary outright can cause his or her means-tested government benefits to be terminated or decreased. For instance, in Florida, disabled individuals receiving Supplemental Security Income cannot have more than $2,000.00 in assets. Thus, although you intend to provide for your special needs beneficiary, you may cause unintentional harm by devising your assets to him or her outright, thereby severing means-tested benefits, such as Medicaid and Supplemental Security Income. Continue Reading

Unintended Consequences: How Not Having an Estate Plan Will Affect Prince’s Legacy

April 27, 2016 | by Chepenik Trushin LLP

Music legend Prince’s mysterious death continues to cause speculation as all of the details regarding his estate plan, or lack thereof, have yet to emerge. Prince reportedly amassed a fortune worth at least $300 million and his estate is expected to have an equally impressive future income stream. The estate stands to profit from the posthumous records sales that have soared since the star’s death, as well as “a trove of unreleased recordings” rumored to be in what Prince called, “the vault.” However, the future of Prince’s estate and legacy will depend on whether he created an estate plan.

Proper estate planning guarantees that your wishes are honored after death and the failure to do so may lead to unintended consequences. In Prince’s case it means that his sister, Tyka Nelson, is likely to inherit a large portion of his estate. Reportedly, Prince had a strained relationship with his sister, who at one point was allegedly addicted to crack cocaine and resorted to prostitution to support her children. It is unlikely that Prince intended for a substantial portion of his estate to pass on to her without a mechanism to distribute assets over time. Nevertheless, without the proper estate planning documents in place, this is the likely outcome as Tyka has indicated that the rock star died without a will. Continue Reading