Archive for February, 2013
“I LOVE YOU” WILLS – THE PERFECT PLAN FOR COUPLES?
Still looking for that perfect gift for your valentine? If so, you may be thinking an “I Love You” Will – really anything with those three little words in it – might do the trick. But what exactly is an “I Love You” Will?
When wills and trusts lawyers talk about “I Love You” Wills, we are referring to a simple will that leaves everything first to your significant other and then to your children. The name comes from the fact that we usually design these wills in pairs for happy couples who love each other and the responsible adult children that they had together. If you are lucky enough to lead such an idyllic life, an “I Love You” Will might be a suitable estate plan for you.
However, there are many issues common to the rest of us that are not adequately addressed by an “I Love You” Will. For example, such a will does not make any plan for the possibility that your significant other or one of your children will be disabled and/or receiving government benefits at the time of your death. An “I Love You” Will also does not address who will care for your minor children, or how that care will be paid for, should something happen to you. In fact, it doesn’t even address how you would like to be taken care of if you were to become mentally disabled.
Planning your estate can be a wonderful gift to your loved ones – and yourself – but you should consult an attorney to make sure you are getting true peace of mind and not a false sense of security. If you would like more information on “I Love You” Wills or any other type of estate plan, we are here to help.
SUMMARY ADMINISTRATION: AN EASY AND INEXPENSIVE SOLUTION? OR NOT?
Formal estate administration (the most common form of probate) is a detailed process set out by Florida law which can be expensive and time-consuming. As you might imagine, there are some situations where formal administration does not make sense, economically or otherwise. Florida statutes recognize this and set out an alternative process when the decedent either (1) has been dead for more than two years or (2) left less than $75,000 of assets that need to go through probate.
This alternative process, called “Summary Administration,” is supposed to be simpler, shorter, and less expensive than formal administration. Theoretically, summary administration allows for an estate to be opened and closed, and the assets distributed, with only a few documents filed and no court hearing. The law even says that summary administration may be done without an attorney. However, our experience has been that many summary administrations have legal and procedural issues that even attorneys cannot entirely solve.
For example, summary administration quickly becomes more complicated when the decedent left unpaid bills or other debts because summary administration does not use the streamlined process for creditors’ claims that formal administration offers. Formal administration allows a Notice to Creditors to be published in a local newspaper as soon as the estate is open. This publication of notice gives creditors a maximum of three months to file their claims; if they fail to do so, their claims are barred and the estate does not have to pay them. The estate also has a right to object to any creditor claim that is filed.
In summary administration, however, the estate cannot publish a Notice to Creditors until after the Order of Summary Administration is entered. Any Order of Summary Administration (the order closing the estate and listing the persons who will receive the estate assets) entered by the court must provide for the payment of creditors “to the extent that assets are available.” This is true even though creditors may be unknown.
The result is that beneficiaries may suffer in summary administration because there is no clear way for estates to object to and avoid paying creditor claims. New creditors may pop up after the Notice to Creditors is published, which may diminish the amount each beneficiary receives. Another danger is that no Notice to Creditors is published, because it is not required by law, creating the possibility that unknown and unpaid creditors may be able to come after the estate beneficiaries years later
Although summary administration may be a viable solution in some situations, we recommend that our clients take advantage of the formal administration process if there is any possibility that a decedent left unpaid creditors. We would also recommend at least consulting an attorney before pursuing a summary administration.