Basic estate planning includes the following estate planning documents: living will (do not resuscitate document), durable power of attorney for health care (incapacity planning document for health care-related decisions), Read more
A lady bird deed, which is also known as an “enhanced life estate deed”, is a strategy where an individual transfers property to someone else outside of probate while retaining a life estate in the property. The lady bird deed takes its name from Lady Bird Johnson, whose husband, President Lyndon Johnson utilized this enhanced life estate deed strategy for asset preservation in the 1980’s. The lady bird deed is often times used for Medicaid planning as well as probate avoidance. The downfall to the enhanced life estate deed is that it is only recognized in a few states, including, but not limited to: Florida, Michigan and Texas. Also important to note is that the alternative to a lady bird deed is setting up a revocable trust and deeding the property to the revocable trust for probate avoidance.
This enhanced life estate deed is different from other life estate deeds in that the life tenant can commit waste, sell or even encumber the property without the consent of the remainderman or anyone else. With the traditional life estate deed, the remainderman must join in the consent to sell or mortgage the subject property. The life estate terminates upon the life tenant’s death, and the beneficiary of the remainder interest (the remainderman) becomes the immediate owner of the property at the same time. Typically, all that the remainderman has to do is record the life tenant’s death certificate and no estate tax due affidavit to formalize the transfer of the property outside of probate. A knowledgeable attorney should draft the enhanced life estate deed in order to ensure that the deed contains all of the proper provisions required to retain such enhanced control over the property during a life tenant’s lifetime.
Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.
Florida has various property tax exemptions available to residents who own property in the State of Florida. One of the most widely known tax exemptions is homestead. Homestead not only provides creditor protection for an individual’s primary residence, but also allows for a reduction in the taxable value of a homeowner’s property. Tax exemptions, other than homestead, are available for individuals to take advantage of, where applicable.
The Florida homestead property tax exemption reduces the value of an individual’s primary residence for assessment of property taxes by $50,000.00. However, the second $25,000.00 of homestead property tax exemption does not apply to the school portion of the property taxes, and only applies to the third $25,000.00 of a property’s total value (the portion of the property’s value between $50,000.00 and $75,000.00). In other words, a home that is worth $150,000.00 is taxed as though it is worth only $100,000.00. This proves to have significant property tax savings for homeowners.
In addition to homestead, certain other tax exemptions are available to Florida residences. These include: $500.00 Disability tax exemption, $500.00 Disability tax exemption for blind persons, $500.00 Widow/Widower tax exemption, additional $25,000.00 Senior Low-income tax exemption, $5,000.00 Veteran’s Disability tax exemption, along with other certain tax exemptions available for individuals in the Military. Each of the property tax exemptions requires certain documents (or proof) to be filed with the property appraiser’s office, however, the requirements are typically minimal and do not create a significant burden on the applicant.
See the full list of property tax exemptions in Broward County here: http://www.bcpa.net/homestead.asp. If you live in a different county, you can check your local property appraiser’s office website for the property tax exemptions available in your county.
Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.
A business owner should always consider whether business liability insurance is prudent for their new and/or existing business. In almost all cases, the answer is affirmative. Read more
Probate administration in Florida comes two forms: formal probate administration and summary probate administration. Formal probate administration is required when a person passes away with assets worth seventy-five thousand ($75,000.00) dollars or more in their individual name. Read more
Asset protection is a hot topic for most commercial real estate investors. Asset Protection should be approached differently for each different type of asset. As for commercial real property, asset protection can be achieved by properly titling newly purchased commercial real estate property. Read more
Purchasing a home is a big deal, literally! The real property transaction should be done properly without any corners cut. The following are a few advantages to having a Survey of the property completed:
Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.
The following is a great article on the commercial real estate market written by Rick Tobin of Premier Hotel Realty, a South Florida Commercial Real Estate Brokerage.
The Changing Faces of Commercial Real Estate
The commercial real estate market (“CRE”) is constantly changing and evolving. The commercial real estate market is growing in some areas, and shrinking in others. In fact, it’s changing so fast, sometimes it’s hard to tell which direction things are headed!
According to a recent article from Forbes magazine on the commercial real estate industry, commercial real estate values are expected to continue to rise in the years ahead in various sector industries. This is due to the evolution of how properties are marketed and used as well as how those properties are changing their character.
Here are the major changing segments of the CRE industry to watch:
Multifamily
The Millennials have changed the way multifamily properties are being developed and marketed. A growing preference for smaller, rentable spaces and the tiny house movement has shaped the way developers are looking at apartment complexes. According to the most recent PEW survey, greater numbers of Millennials tend to prefer to rent rather than own. The American dream of owning a home has shifted to 400 square feet homes, often with a view of the ocean and numerous recreational amenities. Many Millennials want to be mobile, and to avoid the traditional ties of ownership.
Hotels
While hotel occupancy has remained strong, many sectors are competing with “shared accommodation” platforms, like AirBnB and VRBO, leaving hotels to market to events customers and the business traveler. High speed internet is in huge demand and travelers insist that coverage be provided throughout facilities. Workspaces are incorporated into rooms and chargers and electrical outlets must support today’s technology toting travelers.
Office
The latest trend in workspaces is the demand for shared office space. This new work style helps incubate small business in new ways. Small, flexible spaces are in high demand. Cutting overhead costs, many office spaces are cohabitated by related synergistic industries that benefit from partnering with each other. Many shared spaces have networking and business partnering all in one floor and the occupants pay ala carte prices from a Chinese menu.
Retail
The rise of e-commerce sales has reshaped many traditional retail spaces. Companies are tailoring their space for employees instead of their clients. While their website is designed to attract their customers, their retail space is designed for employees. Storefronts may be a thing of the past in this e-commerce world, and stores may become showrooms for behind-the-scenes fulfillment centers.
What does all this mean? With change comes opportunity for those with vision and flexibility to take advantage of the morphing commercial real estate industry.
A large part of estate planning is how assets are titled. There are five common ways that are used in the titling of assets. Also equally important in estate planning is to ensure that the correct beneficiaries are designated on your financial planning accounts (including, but not limited to: checking, savings, other banking, brokerage, life insurance and/or retirement accounts). The best time to check the titling of all of your assets is when you create a new estate plan, or revise a prior estate plan.
Assets can be titled on one or three major ways. Individually, concurrently or in a business entity. Concurrent ownership includes tenants in common, joint tenancy and tenants by the entirety (also known as husband and wife). Important to note is that while most states follow common law property rules, there are several states which follow community property rules.
Tenants in commons share the undivided rights to property concurrently, however, their interests are alienable, devisable, descendible. That means that property concurrently owned in tenants in common can be sold, bequeathed through estate planning or otherwise inheritable by descendants. Take the example of Tom and Jim owning a home as tenants in common (50% each). If Jim passes away and leaves his half to his son, John, then the home will be owned by Tom and John (50% each).
Joint tenants also share the undivided rights to property concurrently. A joint tenancy can only be created when the four unities exist (same time, same title, same interest, and the same possession). The language must also indicate that the grantor intended to convey a joint tenancy. Joint tenants benefit from probate avoidance because their interests pass by survivorship. In other words, when one joint tenant passes away, the other joint tenant automatically inherits the deceased joint tenant’s interest. If there are multiple joint tenants, then each surviving joint tenant will inherit the interests in the same proportion (consistent with the four unities). A joint tenancy can further be severed when one of the unities is disturbed. One example of this is a sale of the respective joint tenant’s interest to a third party. Upon severance, all of the joint tenant interests convert into a tenancy in common.
Tenants by the entirety (“TBE”), which is reserved for married individuals, share the undivided rights to property concurrently. Like joint tenancy, TBE ownership benefits from probate avoidance due to survivorship. However, unlike joint tenancy, tenancy by the entirety cannot be severed by sale without the consent of both spouses.
Finally, property can be owned by a business entity. There are many types of business entities including but not limited to: limited liability company (“LLC”), partnership, limited partnership (“LP”) and corporation. Business entities can also be incorporated in any U.S. state or even internationally. Deciding what business entity to use should be made on a case-by-case decision based on the asset category. The same goes for choosing the jurisdiction in which to incorporate the business.
Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.
There are several common types of deeds in Florida including: the warranty deed, life estate deed, quit claim deed and special warranty deed. The most protective type of deed is the warranty deed. The special warranty provides very limited warranties (the seller warrants that he or she has done nothing to encumber the title to the property). The quitclaim deed provides no warranties.
There are also different present and future ownership interests that can be conveyed. Fee simple ownership has present and future ownership rights (the best ownership a person can have). Fee simple defeasible ownership is less common, but adds a contingency to the vesting of an individual’s rights to a property. The final ownership interest is the life estate and is used often in conjunction with estate planning. The deed reserves a lifetime ownership (present interest) to the grantor or other individual(s) and then the remainder (future interest) is deeded to another individual, entity or revocable living trust. A life estate for the life of someone other than the grantor is called a life estate pur autre vie (ie: if carol is given use of the family house for as long as her mother lives, she has possession of the house pur autre vie).
In order to preserve the remainder man’s interest’s, the life estate holder must follow certain rules. Specifically, the life estate holder cannot commit any type of waste during their life ownership. Waste is made in three different ways; voluntary, permissive or ameliorative. Voluntary waste is where the property is used in a manner in which reduces its market value. Permissive waste happens when a life estate holder fails to upkeep the property. Ameliorative waste is altering a property by making improvements. While ameliorative waste is not permitted, it usually will not be actionable since the damages are limited or do not even exist.
Revocable living trusts are often used with the life estate in estate planning. Specifically, the grantor reserves a life estate in the property (often primary home) and then gives the remainder interest to the revocable living trust (which is either already executed or created in conjunction with the deed). From there, your predetermined trust beneficiaries will obtain the rights to the property through the trust document.
Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, business law, probate, guardianship and/or real estate needs.
A real estate contract for the sale and purchase of real property has a number of elements, which can be confusing and complex. Failure to select strategic terms in a contract for the sale and purchase of real estate or abide by the time limits specified in an executed contract can lead to litigation fairly quickly.
The first step to executing a Contract for Sale and Purchase of Real Estate is to submit a written offer to a seller. Upon receipt of an offer, a seller can either accept the contract agreement on your terms, or counter offer on different terms. If the seller remits a counter offer, a contract is not complete, but rather the ball is back in your court. At this point you may either accept the seller’s counter terms or continue to negotiate. Just because you feel that you found your dream home doesn’t mean you have to back yourself into unfavorable sale terms.
In Florida, there is a standard Contract for Sale and Purchase that has been approved by the Florida Realtors and Florida Bar. Notwithstanding such Contract, you still may have some flexibility in choosing contract terms depending on the county you reside in and the flexibility of the other party to the transaction. You may also attach addendum with custom terms, which have to be executed by both the buyer and seller.
Once a buyer and seller agrees on contract terms and the contract is signed and initialed by all parties, an executed contract exists. After the execution of a contract for sale and purchase of real estate, the buyer and seller must follow the contract terms, including any applicable deadlines for actions such as inspections, surveys, financing, insurance, etc., unless waived, in writing by both parties (in an addendum or separate writing). it is advisable to retain a real estate attorney to assist you navigate through all of the complexities and confusions of real estate law.
Contact Capital Planning Law, PLLC for your complimentary consultation to discuss your estate planning, probate, guardianship and/or real estate needs.