Thinking of Becoming a Florida Resident? Read this First!

Many persons decide they want to trade the cold winters in the northern states for the sunny, warmer Januaries of Florida on a permanent basis. Although Florida is relatively lenient about who is a resident and who is not (except as to homestead claims), the bigger issue is generally the state from which one departs residency.

If you are considering becoming a Florida resident, ask yourself these questions:

Am I ready to spend less time in my home state? Many other states declare you a resident if you are physically present in their state for more than half the year. If you are not ready (or able) to significantly reduce the number of days you spend in your current state of residence, you may not be ready to change your residency.

Am I ready to sell my home? A strong argument that many states (New York and Massachusetts among them) use to claim a person remains a resident is whether that person owns real estate (particularly their personal residence) in that state.

Have I had my estate plan reviewed and updated by a Florida attorney practicing in Florida? Although there are many attorneys who hold Florida licenses who do not practice within the state, it is a good idea to have someone who practices within Florida review the plan to determine what, if any changes might be necessary in order to allow the documents to work effectively under Florida law.

There are many other steps to be taken and considered in making the residency determination. If you are interested in learning more please contact us at rmd@rmd-law.com

First Five: An Introduction to Estate Planning

What is a Revocable Trust?
Also called a "living trust" because it is created while you are living, this trust is a document which allows you to own and manage your property during your lifetime, while maintaining complete control over all aspects of it, and having the added bonus of enabling you to avoid the necessity of an official probate of your estate through the court system.

If I have a Revocable Trusto then do I need a Will?
Yes. Although the Revocable Trust is often referred to as a "will substitute" because it acts to transfer your property after your death without the use of a will, a will is still necessary for several reasons. First, Florida law has not specifically acknowledged that a Revocable Trust may serve as a replacement for a will in all respects. Second, there is always the possibility that all of your property may not be transferred to your trust prior to your death, and in order to make certain that property goes where you want it, you should have a will as a backup.

Does a Revocable Trust save me taxes?
Not Exactly. A Revocable Trust is a valuable estate planning document which, if properly completed, will maximize your use of your estate tax credits and deductions. It does not, however, prevent any property from being subject to estate taxes simply because that property is owned by the trust.

A Revocable Trust can, however, eliminate the need for a formal probate administration in Florida if all of your property is transferred to the trust prior to your death. Additionally, it can also avoid the need to implement guardianship proceedings should you become incapacitated.

Is a Living Will different?
A Living Will, also sometimes called an advance directive, or a "Do Not Resuscitate" (DNR) order, is a document which indicates your desires as to medical treatment when you are unable to state your wishes as the result of an irreversible condition. This document indicates whether you wish to be kept on life support, and whether you wish heroic measures be taken to save your life. It is often recommended to be combined with your health care surrogate designation and your HIPAA release.

Do I need a Revocable Trust?
The answer to this question depends on the types of assets, as well as their values, that you own. Each person's situation is special and must be evaluated on an individual basis. Always remember: no other person has the exact same situation as you, so what works for your neighbor may not be the best choice for you. Your financial consultant, attorney and accountant will be able to assist you in making these determinations and establishing an estate plan to meet your unique needs and desires.