You are walking through a crowded public place -a shopping mall let’s say. At that moment on that random day, anything could be going on in your life – let’s say you are running errands during your lunch break, have recently closed escrow on a new home, and have dinner with the in-laws that evening.  The point is you are minding your own business and living your life.

Suddenly, completely unexpected and interrupting your life, organized chaos breaks out in front of you.  A large number of people, who appeared to be ordinary pedestrians with ordinary daily concerns, synchronize and start performing a bizarre act in unison – I don’t know, let’s say they all start playing Kazoos to the tune of Eddie Murphy’s “Party all the time,” while each tossing out handfuls of bouncy balls on to the ground.

In other words, you have experienced a flash mob.  A flash mob is one of those occurrences that you have never actually witnessed, but you have seen proof of flash mobs on TV or may even know people who have experienced a flash mob.  You never expect them to happen to you, but you know they occur in everyday life.  And although you never expect to run across a flash mob in your life, one day, unexpectedly and unplanned, it could happen.

That is why I always carry pepper spray, to protect me from a sudden encounter with a group of unruly flash mobsters.  Metaphorically speaking, a flash mob is comparable death, and a can of pepper spray is a lot like an estate plan.  No one ever expects to face death.  It could happen at any moment of any day.  No matter what is going on in your life at that moment, death can interrupt it.  Although a person never expects to die so suddenly, especially when there are so many other things on one’s “To-Do” list, it is best to be prepared with an adequate estate plan to assure asset protection.  Contact a qualified estate attorney to create an estate plan right for your needs and receive a lifetime supply of estate pepper spray to assure your assets are protected.

For more information on successful Florida estate planning and probate, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation.

It’s a Wild world. Are you protected?

Today, Rep. Anthony Weiner listened to calls for his resignation from Congress after a two-week scandal. The scandal initiated when he posted a photograph exposing his genitals through his twitter account.

The sexting scandal grew when the Weiner admitted that he lied after initially claiming that his account had been hacked. Weiner eventually admitted that he sent the picture and had maintained several inappropriate relationships with women he met online. Weiner will most likely lose a very promising political career because he allowed himself to be exposed.

Don’t be a Weiner, never leave yourself exposed. That includes your assets and your loved ones.  For most people leaving a legacy to their loved ones is a priority. We live in a very litigious society; you never know when someone may want their share of your work. Don’t let a lifetime of hard work slip away in a matter of days. Make sure your Estate Plan and Asset Protection Plan are in order.

For more information on successful Florida estate planning and probate, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation.

It’s a Wild world. Are you protected?

Yes! If you dont deed your home to your trust, your home will be forced into the probate process after the deaths of both you and your spouse. Real estate is one of the most difficult assets to probate, so you definitely want to assure that ALL of your real estate is owned by your trust or by your LLC. Your home should always be owned by your revocable trust.

Some of my clients are concerned that the transferring of their homestead into their revocable trust will forfeit their homestead protection. It will not affect any homestead rights you currently have. Trust ownership has always provided for the continued tax advantages and creditor protection that home owners are afforded in Florida. Florida’s Third District Court of Appeals affirmed this understanding in their Octobet 27, 2010 ruling in the case of Aronson v Aronson.

There should now be no question as to the title of your homestead. It should always be owned by your revocable trust.

A difference between a corporation and an LLC is that a creditor of an owner may directly levy on the debtor/shareholder’s stock in a corporation and thus take all the rights that compose the stock share, such as voting rights, right to elect directors, etc. By contrast, a creditor of an LLC is usually limited to a lien against the debtor/member’s economic right to distributions only until the judgment is paid, but the creditor usually takes no other of the debtor/member’s rights in the LLC. (This is often referred to as a “charging order lien” from the form of the relief usually specified in the RULPA/RULLCA).

Keep in mind that one can have an “S-LLC” by the simple expedient of checking the box for the LLC to be taxed as a corporation instead of a partnership, and then making the S-election for the LLC.

Although the ruling in the Olmstead case subjected single-member LLC assets to liability tied to its single member, this may be held to be a bad ruling in the future. It certainly goes against the purpose and spirit of the LLC laws. In any event, this potential adverse result may be easily avoided by interjecting a second member in any Florida LLC until the law is further clarified. Another significant problem with an S Corp is that they are, by far, the worst structure for advanced planning purposes. The limitations imposed on financial planning and estate planning and the limitations against international shareholders are major impediments to using S corps, particularly in an increasingly more complicated estate and tax environment and a world that is quickly globalizing.

Too many attorneys and CPAs don’t seem to know that you can make the S election for the LLC; in general I much prefer the LLC for estate planning and asset protection purposes (although the single-member issues can be a concern if their are not two viable members to include in the LLC). While S corporations still have some effective uses, their use in the future as business entities will be far more limited, and LLCs will continue to be the vehicle of choice for privately-held and family businesses.

In addition to severely weakening the asset protection advantage of a single member LLC in Florida, the Florida Supreme Court’s decision in the Olmstead case unfortunately calls into question the effectiveness of multi-member LLCs in this state.

The Olmstead decision provides a stark reminder of two very important points:

1.Asset protection law varies significantly from state to state; and
2.Asset protection laws are constantly changing, both through statutory changes and court decisions.

Having a competent professional assist you with your asset protection planning is vitally important. It is also important to have any asset protection plan reviewed periodically because the law in this area is evolving very rapidly.

1. Waiting too long to start planning. The longer your asset protection plan has been in place, the stronger it will be. It will also cost less to do the planning long before you have a problem. Once a lawsuit has been filed against you, any transfers you make can be overturned. In order to battle a lawsuit effectively, make sure you have an asset protection plan in place long before you need it.
2. Mistakenly committing fraudulent transfers. If you transfer assets to a friend or family member in order to avoid losing them during a settlement, you may find it does you no good. This is not illegal, but the courts can reverse the transfer and hold the transferee partially responsible.
3. Trying to hide your assets. This is no longer possible. Even moving assets offshore does not prevent them from being discovered. Eventually, lawyers will uncover the existence of the asset. In some cases, having the asset offshore may protect it, but it will not prevent it from being discovered.
4. Assuming you can outsmart the creditors. Those trying to collect their debt and the lawyers working for them have done this before. You will not figure out a way around the system.
5. Handing control of your assets over to someone else. Often called the “poor man’s” asset protection, signing over your wealth to another person is never a good idea, even if he is a trusted friend or family member. You may have to give up some control at some point, but deciding you will protect your assets by giving them over to a sibling or adult child is a mistake. Discuss your options with an experienced asset protection attorney before proceeding.
6. Assuming asset protection and estate planning are the same thing. Asset protection is part of any strong estate plan but they are not the same thing. It is important to remember a living trust does nothing to protect you from creditors.
7. Confusing bankruptcy law and asset protection law. In a state like Florida, newer bankruptcy laws do not affect the unlimited homestead exemptions. You have less protection in bankruptcy court, so filing for bankruptcy should be used as a last resort.
8. Assuming it is too late to establish an asset protection plan. It is never to late to do this. Doing something is better than just allowing the courts to have their way with you. At least make an effort to protect your assets. You never know when you may be faced with a situation where your assets are at risk.
9. Not getting your foundation estate plan in place as part of your asset protection plan.
10. Trying to do it yourself. You only have one shot at protecting your assets correctly. Be sure to use an attorney that specializes in asset protection.

A Special-Needs Trust is a trust established for the benefit of a disabled beneficiary who is entitled to receive governmental assistance.  The intent of the trust is to provide for the beneficiary above-and-beyond the supplemental assistance without accidentally turning that Federal aid “faucet” off.  The correct drafting of this type of trust is very important since errors can result in the loss of government assistance or trust income. 

The payment of income and principal should be entirely left to the discretion of the trustee and the beneficiary should never be given the option to act as their own trustee.  In addition, cash payments should never be made directly to the beneficiary.  Instead, the trust should simply pay for the items that are needed by the beneficiary.  This is important because any money the beneficiary receives may reduce their Supplemental Security Income or may even cause a total loss of Medicaid benefits.

The beneficiary, or their guardian, will ask the trustee to make a distribution.  The trustee will consider whether or not he or she is permitted to make the distribution and whether making the distribution is in the best interest of the beneficiary.  If the trustee agrees to the distribution, the trustee will pay for the good or service directly from the trust account to the vendor. 

Protective wording should be inserted in the trust to clarify that the trustee is to expend income and principal only after Federal, state, and local public assistance is received and exhausted.  The income and principal should only be used for the benefit of the beneficiary.  A spendthrift clause should also be included in the trust to avoid the possibility of the government’s attaching the trust property to be reimbursed for its public assistance payments.

Choosing an attorney to draft a Special-Needs Trust is not always an easy task.  Drafting a Special-Needs Trust is highly specialized and you want someone who is experienced in this area.  Choose someone whom you can trust and you feel comfortable with because the Special-Needs Trust will last for the lifetime of the beneficiary and your attorney will be a crucial part of your financial team. 

Michael D. Wild is a Florida attorney specializing in the areas of estate planning and asset protection.  For more information on successful Florida estate planning and asset protection techniques, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation.  Protecting what you value most.

Congress hasn’t renewed the Economic Growth and Tax Relief Reconciliation Act of 2001, otherwise known as E. G. T. R. R. A. consequently the estate tax will go back to 55% again next year. Even small estates will have to expect a possible estate tax at death. With this in mind, it becomes imperative that individuals planning their estate, incorporate, in combination with basic revocable trust planning, several of the more advanced estate planning strategies.

 While the the estate tax related reasons for proper estate planning are certainly valid, they should not be your sole motivation. Even while the E. G. T. R. R. A. was in effect, the more successful estate planning attorneys learned that proper estate planning was justified for reasons beyond purely tax savings.  In the interim, while we await the decisions of our leaders we experience a continued uncertainty.

The estate tax will continue to be a hot political issue beyond 2010. There are way too many winners and not enough losers if EGTRRA is allowed to sunset.  Let’s examine the players in this, and see just what it is they have on the line:

Democrats – Increased revenues may help offset continued increasing budget deficits.

Republicans : Campaigning for a repeal of the estate tax continues to be an effective fundraising issue. A permanent resolution of the estate tax issue would “kill the Golden Goose.”

Insurance Companies – Use of ILITs funded by life insurance policies will again become a favorite estate planning tool to pay for the estate tax and preserve the estate.

Charities – estate tax motivated charitable planning will again become popular.

As for the States, they are counting on the return of the estater tax to boost dwindling revenues.

Losers, should the estate tax return: Those with a vested interest in seeing a permanent end to to the estate tax are the heirs of those people who have failed to plan.

The political posturing of the estate tax issue has changed from the early Bush years of calls to repeal the “unfair and unjust death tax” to “not giving a tax break to the very wealthy.” It is unlikely that we will see bipartisan political agreement on any meaningful long-term “estate tax reform” in the near future.

What this means to you is continued uncertainty about the pending return of the estate tax. For those people lucky enough to live in South Florida, the estate planning attorneys of Wild Felice & Pardo can effectively create an estate plan that will protect your beneficiaries from any possible estate tax and make certain to avoid probate entirely.

Michael D. Wild is a Florida attorney specializing in the areas of estate planning and asset protection. For more information on successful Florida estate planning and asset protection techniques, please contact the South Florida law firm of Wild Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com to schedule your free consultation. Protecting what you value most.

Everyone needs a basic estate plan. This involves putting the documents in place that will take care of you in case you become disabled and will take care of your loved ones once you pass away. However, there are certain circumstances where additional planning is necessary. This is where Advanced Estate Planning comes in. Here are some of the areas Advanced Estate Planning covers:

1) Tax Planning: If your estate is large enough, you’ll need to work with your estate planning attorney to minimize or reduce estate taxes and generation skipping transfer (GST) taxes.

2) Asset Protection Planning: Your estate planning attorney can help you structure the way you hold title to your property so as to limit creditors’ ability to access it.

3) Planning for Disabled Beneficiaries: A Special Needs Trust can help you leave money to a disabled beneficiary without interfering with his or her government benefits.

4) Planning for Beneficiaries with Special Circumstances: If you have a beneficiary with trouble handling finances or may be in a rocky marriage, your estate planning attorney can help you establish a trust that will allow that beneficiary access to money or property without leaving him an outright distribution. This will help protect his or her legacy in case of divorce proceedings or creditors’ claims.

5) Business Succession Planning: If you’re the owner of a closely held business, special planning is required to smooth the transition of ownership in the event of your disability or death. Your attorney can help you anticipate potential problems and tailor solutions to meet your needs.

For more information about estate planning and asset protection techniques and to schedule your free consultation with one of our attorneys, please contact the attorneys of Wild Felice & Pardo at 954-944-2855 or via email at info@wfplaw.com.  Protecting what you value most.

Even if you remember to assign your IRA with the correct beneficiary designation, there are many benefits in using a trust to distibute your IRA after death.   One such benefit is the ability to provide asset protection to your beneficiaries once they receive the money from the IRA.  Recently, the Florida Supreme Court ruled that inherited IRA’s do not have the same asset protection features as self-owned IRA’s do.  A trust would supply the asset protection that an inherited IRA currently lacks.