Are you very aware of how important creating a Florida estate plan is for yourself and your family? With your estate planning you know you are protecting yourself, what you love most, your business, and ensure the legacy you are creating will survive you. In our firm we sincerely understand the importance of your goals and will work with them to create a Florida estate plan that will work for your unique situation.
Now, as part of our planning process, we not only look at who you want to inherit from you and who should make your decisions in a moment of crisis, but what implications your planning may have or not have. Therefore, this involves a very candid look at your financial situation, including your tax structure.
As we come to the end of the 2023 tax season, what most people do not realize is that taxes play an important role in their Florida estate plan. The decisions they make now can have both a lifetime and deathtime impact on their estate, which is critical to plan for. Let us share a few suggestions we give our clients.
1. Want to avoid federal estate taxation? Plan now. Are you aware that one of the benefits of living in Florida is that there are no state death taxes? However, this is not the case on the federal level. All Americans, with a taxable estate high enough in value, may face estate taxation. Through your comprehensive Florida estate planning our goal is to minimize the risk that your estate will be taxed at your death. We do this by taking a careful consideration of factors including, but not limited to, your family structure, what assets comprise your taxable estate, the structure and nature of those assets, and the strategies available to you.
2. Want to make lifetime gifts? Be careful. Your Florida estate planning and donative intent can impact your annual taxes as well. This occurs through the gift tax. While you can give your loved ones the annual exclusion amount each year, which is $17,000 per person this year according to the IRS, you can make larger gifts each year and still avoid lifetime taxation. To engage in an advanced strategy like this, we highly recommend that you meet with your experienced Florida estate planning attorney to learn more about the pros and cons of this type of strategy as well as how it may benefit your estate down the line.
3. Want to utilize an estate planning strategy? Look into one that incorporates the Generation Skipping Tax (GST). Be mindful, there are careful rules to plan around when it comes to using the GST as a part of your Florida estate planning. This comes into play when you leave to a family member where there is a thirty-seven and a half year age difference or more. While there can be significant benefits to this type of planning and reasons to complete it, this should not be undertaken without the advice of an experienced Florida estate planning attorney.
4. Watch out for unprotected property and the probate estate. Be very aware that you plan to not leave your assets unprotected. Anything you own at the time of your death that does not have a co-owner or beneficiary, could be subject to the probate process. This is the legal court process that allows solely owner property to pass to the intended beneficiaries. Unfortunately, as a result of the probate process, this is after creditors have the opportunity to file their claims against your estate. When you are planning for your estate and your taxes, it is critical to work with your Florida estate planning attorney to create the right Florida trust agreement for you. It is a trust agreement, and not a last will and testament, that can help you avoid the probate process.
We know this article may raise more questions than it answers. At David H. Jacoby Elder Law Advocate, P. A., we are focused on providing thorough, ethical, and timely solutions for our clients and their loved ones. We encourage you to contact us and schedule a meeting with us.