Your entire life, you work hard in order to develop your savings. Shouldn’t you have a say in where your money goes after your life is over? When the time is right, you should be able to have authority regarding how and where your money and property are allocated upon your passing.
While a will is a useful tool for estate planning, it will not meet all of your needs if you’d prefer the avoidance of probate, asset protection, and the protection of your assets from potential future nursing home costs. You may need to add a trust to your will in order to fulfill this requirement.
Common Types of Trusts in Florida
This is perhaps the most straightforward of all the trusts offered in Florida. These trusts are payable-on-death (POD) accounts that are set up at a bank by a benefactor for a certain beneficiary. This beneficiary will only receive the funds in the Totten trust once the benefactor passes away. The beneficiary holds no legal or financial rights to the money until the benefactor dies.
This sort of trust is designed for philanthropy in the sense that this money is allocated for charity upon the benefactor’s death. An advantage of using this type of trust is that benefactors may save quite a bit of money on their own taxes through tax discounts. Similarly, Florida doesn’t impose a state estate tax, which serves as a significant tax benefit.
Revocable Living Trust
These written agreements allow trustees to retain and administer the grantor’s assets on the beneficiary’s behalf. These trusts are often used in order to avoid probate court with respect to the grantor’s estate.
Florida Asset Preservation Irrevocable Trust (FAPIT ™)
The Florida Asset Preservation Irrevocable Trust (FAPIT™) is an irrevocable trust with far more options than were previously available. Presently, the only attorney in Florida who has the ability to deliver the FAPIT™ difference is Attorney Keith P. Vanover of Vanover Law Firm.
The Benefits of FAPIT™
A FAPIT™ allows you to retain more of your estate by protecting your assets from long-term care costs and future liabilities. Your assets are protected in a FAPIT™ from the following:
- Nursing Home Spend Down Rules 5 years from the creation of the FAPIT™.
- Your children’s creditors
In addition, FAPIT™ solves the following traditional irrevocable trust issues:
- The FAPIT™ uses the creator’s Social Security Number so no separate tax returns.
- The creator controls all investment decisions overall assets.
- The FAPIT™ is tax neutral so no higher or lower taxes.
- Creator may change beneficiaries at will.
The following are additional advantages of the FAPIT™:
- The trustee may be removed at any time for any reason without court permission.
- Beneficiaries may be changed at any time for any reason without court permission.
- Assets in the FAPIT are non-countable for nursing home benefits after 5 years.
- Protects assets from you, your spouse, and your children’s future liabilities.
- The trustee may distribute principle to anyone except you. All of the income may be reserved for yourself or your spouse. Additionally, your beneficiaries will gain a full step-up in tax basis upon your death. This typically allows beneficiaries to avoid capital gains.
- No new IRS number is required. No separate trust tax return must be filed.
If you have assets and are over 50 years old, you’d be wise to consider a FAPIT™. This trust will make sure that all your assets aren’t lost to long-term care. The FAPIT™ will be customized for your particular situation and provides you with the peace of mind knowing that your hard-earned assets won’t vanish due to an unexpected accident or health issue.
The experts at Vanover Law Firm are highly experienced in this area of the law and can help with all your estate planning needs. Don’t hesitate to contact us right away with your case.
Call the Vanover Law Firm experts today at (850) 999-0006 to speak with a Fort Walton Beach attorney about planning your estate.