While people may have heard of a revocable living trust, they may not be exactly certain of what the term means or how such a trust functions. Trusts may generally be divided into two broad categories, including revocable living trusts and irrevocable trusts.
Florida recognizes the validity of spendthrift provisions in trusts created for the purpose of benefiting an intended beneficiary. Normally, a beneficiary who is subject to a spendthrift provision is one that is unable to handle his or her money appropriately. There are certain exceptions to the protection that a spendthrift trust may afford, however.
During their estate planning considerations, many people in Florida consider setting up a living trust in order to avoid probate and to provide for either themselves or for others while the trust creator is still living. A living trust can lend flexibility. Many grantors name themselves as trustee and find little practical difference between managing the trust and managing its property directly.
While the issue of an estate plan may seem like a decision for a later time in one's life, Florida residents of all ages may benefit from considering the importance of having a will or living trust in place. One of the primary interests in forming a living trust is the ability to limit or eliminate the potential for a probate process. During probate, a will becomes a matter of public information, an issue that could allow sensitive information about one's last wishes to be aired in public. With a living trust, however, these matters can be handled privately.
Individuals in Florida who are working on trusts as part of their estate plans need to carefully consider the choice of trustee. This is an important decision because no matter how carefully a trust is designed, if the trustee or trustees do not administer it properly, the goals of the individual who formed the trust may not be achieved.
A trust can be an effective way to avoid probate and transfer assets seamlessly to heirs, reduce estate taxes and give a family privacy. However, there are some things Florida residents need to take into consideration before they set up a revocable or irrevocable trust.
Florida basketball fans have been watching the Donald Sterling debacle unravel. The latest installment in the scandal is that his wife has entered into an agreement to sell the Los Angeles Clippers that is owned by the family trust without his consent. She is making plans to go to probate court in order to resolve the situation and have him declared incapacitated.
Florida individuals who have a high net worth may need additional financial arrangements in addition to the standard estate planning documents like wills and health care directives. Trusts can be a particularly valuable tool for these individuals to use.
Although pop artist Robert Rauschenberg died in 2008 on his exclusive Florida island, some of his closest friends are embroiled in a battle over his money. The three friends were given the duty of administering the man's trust that was part of his $600 million estate. The men are asking for $60 million in fees for administering the trust, and the case will probably go before a Lee County court this year.
Florida taxpayers might be pleased to hear that new laws governing bypass trusts could end up proving beneficial to them when tax time rolls around. Bypass trusts can now serve as potential income tax savings tools in addition to their customary role in estate planning.