Planning for the future

Life is full of the unexpected. But just because the future is unpredictable does not mean adults cannot prepare for what lies ahead. Preparing an estate plan and establishing a power of attorney can be essential to protecting your financial resources and other assets.

What is power of attorney? A power of attorney, or “POA”, is a legal document that allows a person, the “Principal”, to appoint another person, the “Agent”, to manage his or her affairs.

What is covered?

An Agent may perform the acts specified in the POA. Several acts may be allowed by reference to the Florida Statutes governing the Agent’s authority1, such as:

  • Banking transactions;
  • Buying or selling property;
  • Executing a will.

Some acts require the Principal to specifically list the powers granted to the Agent2, such as:

  • Changing beneficiary designations;
  • Creating a living trust.

A POA may be very broad or limited to a specific act depending on the language in the document. The most commonly used is a Durable POA, which means the document will remain in effect if a person becomes mentally incompetent. There was a substantial change in Florida Law regarding powers of attorney in 2011. Prior to October 1, 2011, Florida law allowed for a “springing” POA, which do not go into effect until the Principal becomes incapacitated. The “springing” POA is no longer recognized and now, all powers of attorney are effective upon signing.

Why is power of attorney needed?

Many people believe their family will be able to step in and handle their affairs if they are unable to do so. Unfortunately, this is not true unless a person is named as an agent or granted legal access to financial, medical and other pertinent information. Therefore it is important that the Principal have a POA in place before the unexpected happens. If you’re considering establishing a POA or have already done so, consult with a Florida estate planning attorney to explain the powers you are granting to your agent and ensure your documents are validly executed.

1See Florida Statutes § 709.2201 and 709.2208

2See Florida Statute § 709.2202

3See Florida Statute § 709.2108

Jennifer R. Bondy
Partner
Overstreet Law, P.A.

Download the PDF – Osceola News Gazette

/by

Protecting Your Assets

When you think about homestead exemption, most people immediately think of the $25,000 property tax exemption. That’s because many people are unaware of a valuable form of asset protection granted under Florida’s Constitutional homestead exemption. The Florida Constitution, Article X, Section 4, exempts homestead property “from forced sale under process of any court”. This means the proper homestead designation can also keep your property out of hands of creditors.

What qualifies for homestead exemption?

The designation of homestead is granted to a person’s primary residence, including condominiums, townhomes, and mobile homes. If the property is located within a municipality (i.e. within city limits) up to one-half acre, plus the improvement, shall be exempt homestead. If the property is located outside of a municipality then up to 160 acres of land, along with the improvements, shall be exempt homestead.

How does homestead exemption work?

If a large (court) judgment is entered against you, it can attach to property that you own in the county, and the creditor can force that property to be sold in order to satisfy the judgment. Fortunately creditors cannot force sell your homestead property. You may be wondering how the creditor or the Court determine whether your property is homestead? You can sign an affidavit stating that property is your homestead property,2 which is recorded with the Clerk of the Courts. However, there is no formal requirement that this affidavit be filed.

Is this different than homestead property tax exemption?

With homestead property tax exemption, an application has to be filed with the Osceola County Property Appraiser’s Office. All Florida residents are eligible to apply for a $25,000 homestead property tax exemption if they have legal or equitable title to the property and maintain it as their primary residence beginning on January 1st of the application year.3 Constitutional homestead exemption was created to prevent people from losing the homes they live in to creditors and allows homestead property to be transferred to your spouse and/or children free from creditor claims upon your death. If you have questions about Florida homestead exemption, an experienced attorney can help you protect your assets.

1See Article X, Section 4, of the Florida Constitution.

2See Florida Statute § 222.01 and 222.02

3Visit the Osceola County Property Appraiser’s website https://ira.property-appraiser.org/homestead/WebForm1.aspx for more information.

Jennifer R. Bondy
Partner
Overstreet Law, P.A.

Download the PDF – Osceola News Gazette

/by

What Is The Role Of The Personal Representative In The Florida Probate Process?

When someone passes away they may leave behind property that becomes part of their “estate”. The estate goes through the probate process in Florida, where the judge will appoint a personal representative to oversee the administration of the estate. The personal representative can be an individual, a bank, or a trust company as long as they meet certain requirements.

In Florida, an individual can be a personal representative if they are:

  • Either a Florida resident or a spouse, sibling, parent, child or other close relative of the decedent,
  • Over 18 years of age,
  • Mentally and physically able to fulfill the duties, and
  • Free of felony convictions.

Trust companies, banks or savings and loan companies may be appointed to serve as the personal representative if they are incorporated under Florida Law and authorized to exercise fiduciary powers.

In other states, the personal representative may be known as an executor or administrator of the estate. Whichever term you use, the duties are the same: to administer the probate estate in accordance with state law.

Responsibilities Of The Personal Representative

The personal representative has many responsibilities throughout the Florida probate process. Their primary job is to settle the decedent’s estate. Major responsibilities include:

  • Identify and collect the decedent’s probate assets;
  • Identify and provide notice to creditors regarding decedent’s passing;
  • Pay claims filed against the estate;
  • Defend the estate against improper claims;
  • File and pay taxes;
  • Hire professionals for probate administration (attorneys, accountants, etc.);
  • Pay the expenses of administering the estate from estate funds;
  • Distribute assets to beneficiaries;
  • Close the estate

These are just some of the responsibilities that the personal representative will be asked to perform; there may be other duties, depending on the specifics of the estate.

Why Personal Representatives Need A Probate Attorney

In most cases, Florida law requires an attorney to represent the personal representative in the probate proceeding. Probate attorneys ensure the personal representatives handle the probate process correctly, file necessary documents in Probate court, and also help protect representatives from potential liability. For example, if a personal representative mismanages the probate estate, he or she can be held personally liable for any misconduct or errors. Probate attorneys can help representatives avoid personal liability while still meeting their obligations.

To learn more about the probate services at Overstreet Law, P.A, contact us at 407.847.5151.

/by