Life is messy.
Bad things like divorce, disability, lawsuits, arrests, and ugly break-ups happen to good people all the time. Proper planning may reduce or eliminate some of the stress associated with life’s messes.
Planning techniques may include the use of prenuptial, postnuptial, spousal waivers, pet trusts, firearm trusts, or limited liability companies (LLCs).
Prenuptial Agreements (Prenups)
A prenup can be similar to cohabitation agreement, in that it may specify who’s responsible for taking out the trash or handling the finances. It may specify who will stay home with the kids or what happens if one of the spouses-to-be gets a job offer in another state. But the most common use of a prenup is for protecting assets you acquired before your impending marriage.
Prenups have become much more common in recent years. People are marrying for the first time in their 30s – after establishing a career and acquiring substantial investments and retirement accounts. Or they’re marrying for the second or third time and creating new blended families, yet they want to maintain ownership and control of their existing assets and pass those assets on to the children from their previous marriage(s).
Every state has its own laws for creating valid prenuptial contracts. If you don’t do it exactly right, it could be worthless if you end up in divorce or it could result in unintended consequences if your spouse dies.
We’ll ask you during the estate planning process whether you have a prenup, and if you don’t and one may be appropriate for you, we’ll refer you to a local family law attorney for a consultation.
A postnup is very similar to a prenup, except that it’s created by a married couple not contemplating divorce. In other words, you can’t be secretly planning to divorce your spouse when the agreement is executed. Again, every state has its own laws for creating valid postnuptial agreements.
We’ll ask you during the estate planning process whether you have a postnup, and if you don’t and one may be appropriate for you, we’ll refer you to a local family law attorney for a consultation.
Florida law allows spouses to sign documents that waive all of their statutory rights and protections regarding Homestead, the elective share, family allowance, etc., which allows each spouse to do their own estate planning the way they want. Spousal waivers don’t address divorce at all – they are strictly for estate planning purposes.
To animal lovers, our pets are part of our family. But under the law, they’re just property. In a court there’s really no difference between a stuffed animal and a live pet.
The good news is that Florida law allows us to use a Pet Trust to document our wishes regarding the care of our pets when we’re no longer able to care for them. And Florida courts will enforce the provisions of those Pet Trusts as longs as they’re reasonable. Read more about Pet Trusts here.
A properly crafted Gun Trust, like any Trust, can be designed to suit your particular needs and concerns. You’ll name trustees whom you trust to take possession of your firearms if you become mentally incompetent or temporarily legally prohibited from firearm ownership, possession, or use. If liability, estate taxes, or long-term care planning are your main concerns, you may want to consider – among other things – making your Gun Trust irrevocable. Read more about Gun Trusts here.
Limited Liability Companies (LLCs)
Many businesses operate as LLCs because of all the benefits that particular form of ownership provides. The owners (Members) essentially have a legal wall between their business and personal assets. Very simply, if someone sues the business, a Member (who followed all the rules and didn’t commit any fraud) won’t lose his personal property or personal bank accounts.
But LLCs aren’t just for stores, professional firms, or service businesses. LLCs are commonly created for investment real estate. Generally, each separate property is in its own LLC, so not only is there a legal wall between the Member’s personal and investment property, but there may also be legal walls between each property.
For example, perhaps in addition to your personal residence you own a rental house on Siesta Key, a piece of undeveloped land in Port Charlotte, and a rental office condo east of I-75. All of the property is owned in your name or jointly with your spouse because you don’t want to deal with the hassle of setting up LLCs. If a renter is injured falling down stairs (that he claims you neglected to repair) in the Siesta house, all of your personal assets as well as your other investment properties will be fair game in the resulting lawsuit or settlement. But if that house is in its own LLC, and all of the rules and formalities required for maintaining limited liability protection have been followed, only that one property and its insurance policy will be available to the renter in the event of a lawsuit or settlement.
We’ll ask you during the estate planning process whether you have any corporations or LLCs, and if you don’t and one may be appropriate for you, or if your corporate documents may need amending, we’ll refer you to a local business law attorney for a consultation.
These are just some of the tools available for protecting what’s important to you. Of course, the information on this page is very general and is only meant to provide a basic overview of some common asset protection tools. It is not legal advice. The actual laws involved are complex and very situation-specific.
Please contact us today to discuss your particular needs and concerns.