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Quarantined – take the time to review your estate planning documents, joint tenancy agreements and beneficiaries

April 22, 2020 | by Chepenik Trushin LLP

COVID 19 – Is Your Estate In Order? Non-Probate Transfers and Pitfalls of Beneficiary Designations

In the wake of the recent Corona virus pandemic, many people are understandably concerned about their estate plan. A common misconception is that if you have executed a will or even a trust, then you are all set. In fact, it may not be that simple. In fact, a will is not the only instrument capable of passing down an estate to the decedent’s heirs, and some assets may not be controlled by your will and/or trust at all.

For example, in a joint tenancy with rights of survivorship, the property automatically passes to the surviving owner. So, if A and B own a piece of land in joint tenancy and A dies, B immediately gains full ownership of the land, without a probate administration. A’s right to the land extinguishes and thus, A has nothing to leave to his heirs through a will, or otherwise. Another way to avoid probate is through accounts with Transfer-on-Death (TOD) clauses. An account with a TOD beneficiary will transfer the ownership of the account will be transferred to the beneficiary at the decedent’s death, without a will or trust.

Irrevocable Trusts, one tool in an estate planning tool box

January 24, 2018 | by Chepenik Trushin LLP

IRREVOCABLE SPENDTHRIFT TRUSTS

Trusts are popular estate planning instruments that may bring many benefits both during lifetime and in the case of death. Some common reasons for setting up a trust include the avoidance of costs and time consumption of probate proceedings, property management for those who cannot or do not wish to manage the property themselves, continuance of property management after death or during disability, and saving of taxes and protection of the assets against the claims of creditors. However, there are several types of trusts and not all of them provide these benefits to the same extent.

The revocable trust is the most flexible one as the creator (settlor) can at modify the terms of the trust or completely revoke it at any time. See Fla. Stat. § 736.0602. However, the assets transferred into such trust are still considered personal assets of the settlor and accordingly, can be reached by his or her creditors. See Fla. Stat. § 736.0505(1)(a). Therefore, the revocable trust is not an ideal solution for asset protection purposes. Upon death of the settlor, this trust becomes irrevocable, meaning that the rules for asset distribution can no longer be changed. It is also possible to make a trust irrevocable from the outset and to afford protection against creditors by adding a spendthrift provision. See Fla. Stat. § 736.0502.

Florida Passes the “Florida Fiduciary Access to Digital Assets Act”

March 21, 2016 | by Chepenik Trushin LLP

For hundreds of years, most information existed in tangible form, usually in paper documents. However the advent of digital technology, has transformed the way people acquire and store information and transact business. As people continue to embrace digital technology, many tangible documents have been replaced by digital files. This shift towards digital media has created challenges for fiduciaries tasked with corralling digital assets for individuals who have either lost capacity or died.

In Florida, when an individual dies or is declared incapacitated, a fiduciary is required to use their legal authority to inventory the person’s assets, pay the persons creditors and expenses, and preserve the assets while they are incapacitated or transfer the assets to the proper beneficiaries. Traditionally, an individual’s personal information could be located by searching their paper records, where one could find information regarding bank accounts and bills to be paid. However, the digitalization of personal information has made locating these records more complicated. Fiduciaries must identify and locate these digital assets, determine who has control over access to the assets, and figure out how to access those assets. Continue Reading

Valuable Estate Planning Lessons Can Be Learned from Lamar Odom’s Health Scare

October 28, 2015 | by Chepenik Trushin LLP

By now you have probably heard about former NBA star, Lamar Odom’s, health scare. Odom was found unconscious in a Nevada brothel on Tuesday, October 15, 2015. Fortunately, Odom’s condition has improved, and he appears to be on the road to recovery. What you might have not heard about in the news, however, are the estate implications and complications that came as a result of lax estate planning on behalf of Odom.

Although Odom was a highly-skilled NBA player, his increased fame can be attributed largely to his starring role on E!’s hit TV-series “Khloe & Lamar.” Because of the popularity of the series, Khloe Kardashian and Odom’s “divorce” got a lot of attention and publicity from the media, but apparently not from the California courts. As it turns out, the couple signed and filed divorce papers in July of 2015, but due to a severe backlog in the California courts, their divorce has not been finalized. As a result of the delay, Lamar Odom and Khloe Kardashian are still legally married. These circumstances created an interesting situation when Odom was found unconscious at the brothel because, as his legal spouse, Khloe Kardashian is responsible for making medical decisions on Odom’s behalf.