When someone dies without a solid estate plan in place, it is impossible to control what happens to his/her estate and heirs upon death. On the other hand, a well-prepared estate plan may save one’s loved ones from stressful situations in and out of the court, as well as significantly reduce taxes and administration costs.
Therefore, if you want to guarantee your peace of mind and ensure that your property will be properly taken care of after you are gone, it is crucial to avoid estate planning mistakes.
Common Estate Planning Mistakes in Florida
Not Properly Executing a Will (or Having No Will At All)
The last will is the primary piece of any estate plan. In the will, the testator (the individual making the will) outlines all the instructions regarding:
- How should the property be distributed?
- Who should serve as the personal representative to administer the estate?
- Who would serve as a guardian for minor children or a person with special needs?
Under Florida law, if a will is not properly executed or there is no will upon someone’s passing, the decedent’s estate will be administered according to Florida intestacy laws. The term “intestacy” refers to the estate of someone who died without a will.
Exposing your loved ones to intestacy will certainly cause them a costly and stressful experience. Hence, make sure to work with an expert attorney to draft a valid will.
Considering Your Estate Undersized for Estate Planning
Many people think that estate planning applies only to wealthy estates. Nonetheless, they could be more wrong. Regardless of the size and value of an estate, having a solid estate plan in place is crucial to protect your heirs and ensure your wishes are properly carried out upon death.
Besides, estate planning is not effective only after someone dies. Instead, legal tools such as living wills, health care surrogate designations, and powers of attorney provide valuable solutions for issues that may arise while you are still alive, such as a severe health condition or permanent incapacitation.
Underestimating the Importance of Advance Directives
An advance directive is a legal document that provides specific instructions regarding your medical preferences in case of permanent or temporary incapacitation. There are several tools of this kind available in Florida, such as powers of attorney, health care surrogate designation, and living wills.
A power of attorney permits you to appoint a person to handle all your financial decision-making and manage your property if you are unable to do so.
Health care surrogate designations allow for the designation of a person (agent) to make medical decisions on your behalf in the event of incapacitation.
Highly valuable for cases involving terminal conditions, end-stage conditions, or persistent vegetative state, living wills permit you to determine your preferences regarding end-of-life care and life-prolonging procedures.
Using Trusts Improperly
Undoubtedly, trusts are among the best estate planning tools available for Florida residents. However, if someone creates trust but does not transfer the title of any asset(s) to the arrangement, it will not be possible to avoid probate, mitigate estate taxes, or ensure a smooth distribution of assets to the beneficiaries of the trust.
When someone dies owning assets solely in his/her name, those assets must go through probate before proceeding with the distribution process. Hence, the beneficiaries might be exposed to a long-lasting and costly probate process.