Orange Park Estate Planning Attorney

David A. King, Attorney at Law

1416 Kingsley Avenue

Orange Park, FL  32073

(904) 269-6699

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Wills and Trusts and Estate Planning

 

OVERVIEW

 

      We have over thirty (30) years of experience in the area of estate planning.  This is a brief overview of the services that we provide in this area:

      1
.  SIMPLE Wills.

      2
.  COMPLEX Wills. Complex Wills are for those persons with:


·     
Potential liability for Federal Estate Tax.

·     
Blended families (multiple marriages and multiple sets of children).

·     
Minor children to be cared for in the event of the untimely demise of both parents.

·     
Minor children or minor grandchildren to be made beneficiaries.

·     
Multiple pieces of real estate in states other than Florida.

·     
A family business to be passed down to the next generation where the next generation is already working in the business.

·     
A desire to set up a scholarship fund for children or grandchildren.

·     
Children with “special needs”, either physical or mental or both.


          ……… and this is a partial list.



      3
.  ANALYSIS.  If necessary, we will analyze your estate on an asset-by-asset basis such that we can derive a total dollar value of your assets that are subject to the Federal Estate Tax. If your estate is in excess of the dollar threshold for Federal Estate Tax liability, we are prepared to suggest a strategy and review your options to minimize or eliminate your family’s Federal Estate Tax liability.

     
The threshold for the Federal Estate Tax has been rising in recent years:




YEAR EXEMPTION AMOUNT
   
1976 - 1997 $   600,000.00
1998 $   625,000.00
1999 $   650,000.00
2000 - 2001 $   675,000.00
2002 - 2003 $1,000,000.00
2004 - 2005 $1,500,000.00
2006 - 2008 $2,000,000.00
2009 $3,500,000.00
2010 Unlimited
2011 $5,000,000.00
2012 $5,120,000.00
2013 $5,250,000.00
2014 $5,340,000.00
2015 $5,430,000.00
2016 $5,450,000.00


      4
.  GIFTING.  Many of our Clients like to do gifting to their children or other loved ones. They might choose to do so on an annual basis or on a less regular basis.

      Gifts that annually exceed a specific dollar amount require the filing of a Federal Gift Tax Return with the IRS. We frequently help clients with their gifting strategy.

     
The threshold for the Federal Gift Tax Return has been rising in recent years:



YEAR EXEMPTION AMOUNT
 
1976 - 2001 $10,000.00
2002 - 2005 $11,000.00
2006 - 2008 $12,000.00
2009 - 2012 $13,000.00
2013 - 2016 $14,000.00


      5.  TRUSTS.  We draft and prepare many types of trusts.  Some, but not all, of the types of trusts that we create, are:


·       
Living Trusts (sometimes referred to as Revocable Living Trusts)

·       
Children’s Trusts (“Kiddie Trusts”)

·       
Scholarship Trusts

·       
Insurance Trusts

·        Special Needs Trusts

·        Pet Trusts

·       
Bypass Trusts


           a.  Revocable Living Trust:  The primary purpose of this type of trust is the minimization or avoidance of subjecting your assets to the probate process after your death. A Revocable Living Trust is helpful if you own real estate in states other than Florida because it will avoid your heirs having to do ancillary probates in each state where you own real estate.  Further, a Revocable Living Trust is helpful as you get older and start to lose your ability to handle your affairs by yourself.  Contrary to what you may see or hear in advertisements, Revocable Living Trusts are not the best answer for everyone. If we determine that a Revocable Living Trust is not in your best interest, we will analyze your assets on an asset-by-asset basis, and devise an alternative strategy for each asset. Frequently, these alternatives are of no cost to you other than a small investment of your time.

           b.  Child’s Trust:  We frequently refer to these by their slang name of “Kiddie Trust”.  If you have minor children, ask yourself what would happen if you and your spouse were both in the same auto crash or plane crash and neither of you survived?  The purpose of this type of trust is to plan ahead in the unfortunate event that your minor children lose both of their parents.  The trustee (of your choosing) will marshall all of the parents’ assets and then invest those assets in order to provide for the long term care of the children.  In addition to the day-to-day care of the children, the trustee will be instructed to plan for and provide for the post high school education and/or professional training for the children.  The trustee will then be responsible for doling out the funds carefully, so that he or she does not exhaust the trust funds before the child becomes independent.

           c.  Insurance Trust:  Insurance trusts are an excellent vehicle designed to remove the value of your life insurance from your estate when your goal is to minimize or eliminate your liability for the Federal Estate Tax.

           d.  Special Needs Trust:  The purpose of this type of trust is to provide for the special care and education of a child or an adult who faces unique physical or mental challenges.  It is designed not to jeopardize his or her access to any public benefits that are available to persons with such challenges.

           e.  Pet Trust:  The purpose of this type of trust is to provide for the custody, care and contol of the "family pet animals" that have been purchased, given to, or adopted by, the family.

           f.  Scholarship Trust:  This type of trust is just what the name implies. This type of this is designed to provide college, professional or technical training and education for children or grandchildren.  They can be created by parents or by grandparents.  If necessary, scholarship trusts can also be used to reduce your federal estate tax liability.  They can be designed to provide:

·        tuition only
·        tuition and books
·        tuition and books and room and board

          g.  Bypass Trust: Prior to the 2010 changes to the Federal Estate Tax, this was the basic building block for couples with a Federal Estate Tax problem.  It was the most common tool to minimize or eliminate payment of the Federal Estate Tax.  This method of minimizing Federal Estate Tax is no longer necessary. Spouses now inherit their deceased spouse's Federal Estate Tax exemption along with the deceased spouse's assets.       

      6.  ADVANCE DIRECTIVES

      This general category includes:

·        Living Wills

·       
Health Care Surrogates

·       
Powers of Attorney


           a.  LIVING WILL
:  In its simplest form, a Living Will is a written declaration by an individual that says “If I am in a terminal condition, with no hope of recovery (as determined by 2 individual physicians), do not connect my body to a machine to keep my body alive artificially.”


           b.  POWERS OF ATTORNEY:

     
General Power of Attorney:

                1
.  Typically, but not always, used for a specific event or a specific transaction. Sometimes given by a parent to an adult child or other relative.
                2.  Typically has a limited time of duration.
                3
.  A general power of attorney lapses at the signer’s death or incompetency.

      Durable Power of Attorney:


                1
.  Typically given by one spouse to the other spouse, or from a parent to a child or from a child to a parent.
                2
.  Typically includes a broad range powers for many different kinds of events or transactions.
                3
.  A durable power of attorney is valid until revoked.
                4
.  A durable power of attorney lapses on the death of the signer but it does not lapse at the signer’s incompetency.

      Health Care Surrogate:

             
In its simplest form, it is a written declaration by an individual, that says, “If I am physically or mentally unable to communicate my wishes, concerning my health care decisions, to my doctor, to my nurse or to my hospital, then I want the person named in this document to do so for me.”


The estate planning process frequently requires multiple office and/or telephone conferences; however, all of your office conferences are face-to-face with an attorney and never with staff persons.  We try to customize your estate plan to your unique situation.  We have two additional goals: (1) Minimize or eliminate your liability for the federal estate tax, and/or (2) minimize or eliminate the necessity of probate after your death.



NOTICE:  To ensure compliance with Internal Revenue Service Circular 230, we are required to inform you that any federal tax advice contained in this communication is not intended to be used, and cannot be used, for the purposes of: (a) avoiding penalties under the Internal Revenue Code or (b) promoting, marketing, or recommending to any party any tax-related matter addressed herein.

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