Electronic Wills Not Ready For Prime Time in Florida

Conducting business online is routine these days. We pay bills online. Shop online. Bank online. File tax returns online. So it's natural to ask: Can we create a valid will online? (To be clear, an electronic will does not refer to just downloading a form from a website. It means creating, signing, witnessing, notarizing, and storing the document online.)

In Florida and in all states except two (Nevada and Indiana), the answer is no. The electronic will has proven that it is not quite ready for prime time. If and when it will be remains to be seen.

To guard against fraud, a will must be executed with painstaking formalities. Unlike other documents, the will goes into action only when its creator is no longer around. Pairing those strict legal requirements with digital technology is proving to be a challenge. 

Not that Florida hasn’t tried. In 2017 the state passed the Electronic Wills Act, which included rules governing how the testator, notary and witnesses could participate in a will signing by secure video link - even if they were in different locations. The bill required the video to be recorded, time stamped and stored along with the will. After signing, the will would need to be stored online with a “qualified custodian.” 

The bill never came to fruition, though. It was vetoed by the governor amidst a swirl of unanswered questions. Critics worried about hacking, despite proponents' belief that technologies like Blockchain can keep the process secure. There were also concerns about fraud: Could someone unseen be off-camera during a video conference, influencing the testator? And what would happen if the online custodian went out of business? What about hardware and software glitches? These and other challenging issues are currently under review by the Uniform Commission on Law.

Creating a will is not about filling in the blanks. You should always discuss your situation and goals with a qualified estate planning attorney who knows the law and will make sure this most important document is executed properly. Electronic wills may be in our future, but we are definitely not there yet.

Do-It-Yourself fine for some things - not for your estate planning!

A friend of mine likes to do - or more aptly, likes trying to do - his own home repairs. He enjoys the challenge. He enjoys saving money. And he reasons that if he messes up a project, he can always bring in an expert to fix it.

Doing it yourself is fine when it comes to painting, patching and plumbing. But it's a terrible approach to take to your estate planning, because any mistakes you've made will be discovered when it's too late to do anything about them. You won't be around to call in a professional to repair the damage. Your loved ones and the courts will be left to mop up the mess, and your "project" may turn quite differently, and unpleasantly, from what you envisioned.

The public should keep in mind the perils of do-it-yourself estate planning because downloadable, ready-made legal forms are increasingly available, and advertising for services like Legal Zoom have become ubiquitous. There's no question that it's tempting to save money on legal fees. I am all for frugality, but crafting an estate plan that conforms to the law and meets your goals is not like slapping up a new coat of paint. It's not a suitable do-it-yourself project because it's more complicated than most people think, and the stakes are too high. A recent story out of Minnesota illustrates the point:

Minnesota resident Esther Sullivan passed away in 2013, effectively leaving three wills - from 2006, 2008 and 2010. The courts were left to figure out which of them was legally valid, as well as interpret what Sullivan really wanted to accomplish.

The original will was signed January 19, 2006. It gave Sullivan's former employee half of her estate, and a lesser share to her grandson, Joseph. In 2008, Sullivan apparently changed her mind. She marked up a photocopy of her original will, modifying it to give Joseph half of her estate. She initialed her handwritten changes, signed and dated each page, and wrote at the top that the will "dated January 19, 2006 is void" and should be replaced "with this and all written changes."

In 2010, it appears Sullivan had another change of heart. She downloaded a generic will form from the internet, and filled in the blanks to indicate that Joseph was the sole beneficiary, cutting out her former employee entirely.

You can guess what happened when Sullivan died. Her former employee contended that the 2006 version of the will, giving the employee half of the decedent's estate, was the valid one. Joseph argued that his grandmother had obviously changed her mind and her most recent will, the 2010 will making him sole beneficiary, was the valid one.

The court concluded that Sullivan probably did want to revoke the 2006 will. Nonetheless, the 2008 marked-up photocopy was not a valid way to revoke it. Plus, the photocopy was not even properly executed. As for the 2010 will, it did not conform to the state's requirements for a legally valid will. The issue made its way through the court system, and eventually to the Minnesota Appeals Court. Ultimately, the 2006 will was deemed to be the valid one. Joseph got less than it appears Sullivan intended. And also more: A slew of legal bills. You can read the Minnesota Court of Appeals decision here.

So please, folks: Save the do-it-yourself projects for the patching, painting and plumbing. Leave your estate planning in the hands of a capable estate planning lawyer.

In the end, Brooke Astor's grandsons get nothing, money goes to hated daughter-in-law

If you're like most people, you have definite ideas about who should get your assets after you're gone. Meticulous estate planning is needed because so many situations can imperil your desires. For example, many of us will face protracted periods of incapacity when we can no longer manage our own assets, and may be vulnerable to exploitation. Our plans can also be affected by our loved ones' divorces, remarriages, and family rivalries.  

All of those factors came together with respect to the estate of New York socialite Brooke Astor, who I first told you about in 2012. The most recent chapter in the Astor estate saga unfolded just a few months ago. But before I update you, here's some background: Astor died in 2007 at the age of 105 after suffering from Alzheimer's Disease for many years. Her only son, Anthony Marshall, was her agent under her power of attorney. He allowed his mother to live in squalor and isolation during her years of incapacity. He also stole millions from her, buying gifts for himself such as a $920,000 yacht. He sold one of his mother's paintings, valued at $30-$40 million and promised to a museum, for a mere $10 million, taking a $2 million commission for himself. Ultimately Marshall was convicted of elder abuse, and when all was said and done, the court awarded him just $14.5 million of his mother's estate - a pittance compared to her overall wealth estimated at $200 million. The rest went to charity.

Interestingly, it was Marshall's own sons who blew the whistle on the elder abuse. Philip and Alex had a close relationship with their grandmother, so what happened earlier this year would surely have dismayed her: Marshall's will, filed in June following his 2014 death, disinherited her grandsons. Philip and Alex will not get see a penny of their grandmother's money. Instead, Marshall left "any such property which I received from my mother, Brooke Russell Astor, either by lifetime gift or inheritance" to his third wife, Charlene, a woman Astor was known to abhor and who she referred to as "that b---h." Anything left over when Charlene dies is to go to Charlene's children from her prior marriage - not to Marshall's own sons, Astor's own grandsons.

There's a lesson here. It doesn't take millions to derail your plans. Planning for incapacity must always be a consideration as you plan your estate. And middle class families are as likely to fight over $10,000 as the wealthy are to fight over $10 million. 

You may not have Astor's millions, but you have a right to make sure your hard-earned assets go to the people you care about most. Good planning can help ensure that your hard-earned money stays in your own family. One tool we often recommend to clients to achieve this goal is a Heritage Trust, but other strategies also exist. Contact us for assistance!

What's the best way to safeguard your signed, original Florida will?

When you pass away, your original, signed Florida will must be submitted to the Florida Probate Court. A copy of your will is NOT automatically legally valid. That's why it is essential that you know the location of your original signed will at all times. Your personal representative (executor) and  key family members should also know where it is and how to access it. 

What happens if your original will cannot be found when you pass away? In that case, the Florida Probate Court will presume that you have intentionally destroyed the will. Any beneficiaries under your will who are now "cut out" could then sue to prove that the will was simply lost, not intentionally destroyed. On the other hand, your intestate heirs - i.e., the individuals not necessarily named in your will but who may now stand to inherit your assets as a matter of Florida law  - will no doubt hire lawyers of their own to try to prove that you intentionally destroyed the will.

Lawsuits like this are usually contentious and costly, taking a psychological and financial toll on your beneficiaries. If the intestate heirs prevail, your assets will be distributed according to Florida intestacy laws, not necessarily according to your desires. Your intended beneficiaries would then be cut out... all because the original will could not be found! 

The question then arises: What's the best way to safeguard your original, signed will so that it can be found when it's needed? Should your lawyer keep it? Should you? Clients ask me this all the time. Experience has shown me that the typical client (and his/her beneficiaries) is better off retaining control of the original will rather than leaving it with the lawyer. Here's why:

It is likely that a long period will elapse between the date you sign your will and your death. In the intervening years, your lawyer may relocate, pass away, merge practices, retire, change phone numbers. As the years pass you and your family may even forget who is holding it; or you may create a new will with a different attorney. We get calls all the time from people trying to figure if we have prepared their relative's will, and if we have it in our files. (We don't.) 

If you need more convincing that you are the best person to safeguard your own will, let me share an experience I had several years ago. The court appointed me "inventory attorney" when a local attorney passed away. This means I was in charge of cleaning up and resolving the deceased lawyer's pending client matters. In going through his office, I discovered over 3,000 of his clients' original wills in a back room safe!  Some had been signed decades before. My staff and I embarked on the herculean task of finding the owners. We mailed certified letters, checked phone records, contacted the tax appraisers office, checked death records, etc. After several months of effort, we still had 2,300 unclaimed wills. In the end, the court ordered me to destroy the wills. Have the owners done new wills? Will their wishes be honored when they pass away? There is no definitive way of knowing.

Here's another example: Several weeks ago I had the son of a deceased lawyer come to see me. His father retired in 1990 and passed away in 2002. The father's widow had remained in the family home until 2013, when she moved to an assisted living facility. While cleaning up the house to prepare it for sale, the kids discovered in a back closet a carton containing over 100 original wills that their late father had been holding on behalf of clients. They dated back as far as 1965. I assume when he retired he attempted to reach the clients, but was unable to. Now I am assisting the family in trying to determine the status of these wills and the people who wrote them. Fortunately, the family acted responsibly when they found the cartons and recognized that their father would not have wanted these documents trashed, and are attempting to pursue the rightful owners of these wills.  

If for some extenuating circumstances you still want your attorney to hold your original will and if he/she agrees to do so, you should touch base with him/her every few years and keep him/her updated on your contact information. Give the attorney's information to your personal representative and key family members. If you go to a different lawyer to update your will in the future, ask for the prior lawyer to return your old will, so you can physically destroy it. 

Better yet, keep this important legal document in your own possession in a safe place, like a safe deposit box or a fireproof, flood-proof spot in your home.  Let your personal representative (executor) and key trusted family members know where it is, too, as well as how to access it. Hopefully no one will need it for a long, long time!

Your Florida will: Avoid the "do it yourself" approach

Considering creating a do-it-yourself will to save a few bucks? Please reconsider. You may cause your family unnecessary anguish and conflict. And the few dollars you "save" could be gobbled up at the end of the day by lawyer's fees. The case of Aldrich v. Basile, recently decided in the Florida Supreme Court, clearly demonstrates the disadvantages of do-it-yourself estate planning.

In 2004 Florida resident Ann Aldrich wrote her will using an "E-Z Legal Form." In the handwritten parts of the will that she completed, she indicated that at her death, her possessions were to go to her sister, Mary Jane Eaton. If her sister predeceased her, those assets were to go to her brother, James Michael Aldrich. Her will also had a hand-written list of specific assets, which included several bank accounts, her home and its contents, an IRA, a vehicle, and a life insurance policy. The will was properly signed and witnessed. 

However, Aldrich did NOT state what should happen to any assets she might acquire after the execution of her will. In other words, there was no "residuary clause."  The form had neither a pre-printed residuary clause or guidance for including one.

Eaton died in 2007, predeceasing Aldrich and leaving her a Fidelity account and property in Putnam County, Florida. Obviously, these assets were not included in Aldrich's 2004 will. In an attempt to rectify the problem, Aldrich hand-wrote a note in 2008 stating: This is an addendum to my will dated April 5, 2004. Since my sister Mary Jane Eaton has passed away, I reiterate that all my worldly possessions pass to my brother, James Michael Aldrich..."  The note did not conform to the requirements of Florida law. There were no impartial witnesses; the one and only witness who signed the note was Sandra Schuh, daughter of James Aldrich.

The entire matter sparked a family dispute that ended up in court, ultimately making its way to the Florida Supreme Court. Ms. Aldrich's brother James argued that all of his late sister's assets should go to him. Ms. Aldrich's two nieces (the daughters of another of Aldrich's deceased siblings) argued that the assets Aldrich inherited from Eaton should pass according to Florida intestacy law since (1) her will neither mentioned those assets nor contained a residuary clause and (2) Aldrich's "addendum" was legally invalid. Therefore, the nieces argued, as constitutional heirs at law they were entitled to a piece of the assets Aldrich had inherited when Eaton passed away.

Ultimately the court decided in favor of the nieces, concluding that the assets Aldrich inherited from Eaton could not pass under Aldrich's will. The court decision reads:   

Whether acquired before, after, or at the time a will is executed, assets covered by no provision of the will are not disposed of under the will. Ms. Aldrich's will does not say the first thing about real property in Putnam County or a non-IRA account at Fidelity Investments. The will cannot therefore dispose of these items not because they are after-acquired, but because no provision of the will covers them.

The remarks of Judge Barbara J. Pariente are particularly instructive for anyone who is considering creating an estate plan without using a qualified estate planning/elder law attorney: 

While I appreciate that there are many individuals in this state who who might have difficulty affording a lawyer, this case does remind me of the old adage "penny wise and pound foolish." Obviously, the cost of drafting a will through the use of a pre-printed form is likely substantially lower than the cost of hiring a knowledgeable lawyer. However, as illustrated by this case, the ultimate cost of utilizing such a form to draft one's will has the potential to far surpass the cost of hiring a lawyer at the outset. In a case such as this, which involved a substantial sum of money, the time, effort, and expense of extensive litigation undertaken in order to prove a testator's true intent after the testator's death can necessitate the expenditure of much more substantial amounts in attorney's fees than was avoided during the testator's life by the use of a pre-printed form. I therefore take this opportunity to highlight a cautionary tale of the potential dangers of utilizing pre-printed forms and drafting a will without legal assistance.  As this case illustrates, that decision can ultimately result in the frustration of the testator’s intent, in addition to the payment of extensive attorney’s fees — the precise results the testator sought to avoid in the first place.

To Judge Pariente's remarks I add this: Remember that any errors, omissions or ambiguities in your estate plan will likely remain undiscovered while you are alive. Your will has to clearly speak for you because you will not be around to explain what you really wanted! Please see an experienced and knowledgeable estate planning attorney to make sure that your wishes are honored when you are no longer around to speak for yourself.  

You can read the text of the Florida Supreme Court decision here. 

Another head-scratcher of an estate plan

Clients frequently ask if they are legally obligated to leave assets to certain people. The question usually involves an estranged child. Here's the answer: Under Florida law, a spouse and minor children are entitled to a percentage of a decedent's estate. The government is also entitled to its due if your estate is taxable. Creditors get their piece of the pie, too. But after those obligations, you decide who to name as a beneficiary. After all, it's your money.

Unusual beneficiary choices make headlines. My late client, Maria Woods, a German immigrant, left the bulk of her estate to the U.S. government out of appreciation for the opportunities this country provided her. A more recent example is the late Robert Gerin of Buffalo, New York, who died in 2010. The Buffalo News reports that Gerin, a New York-born truck driver and cab driver, never married and had no children. He had a girlfriend and some distant relatives, including an uncle in Florida. His will directed that his assets, about half a million dollars mostly in mutual funds, were to be split between the U.S. Treasury and Consumer Reports. Unlike Maria Woods, who made the reasons for her choices quite clear to me, no one seems to know the logic behind Gerin's choices. According to Consumer Reports, Gerin was not even a consistent subscriber over the years. Even the attorney who drafted his will could not tell the New York Surrogate Court precisely why Gerin insisted on doing what he did... only that he was emphatic about it.

While gifts like Woods' and Gerin's are unusual, they are not unheard of. Brad Benson of the Treasury Department told the Buffalo News that in 2013 the Treasury received $1.76 million in bequests. The Treasury also maintains a "conscience fund," to which people contribute when they feel guilty about having defrauded the government and gotten away with it. 

No way is this a trend, though! Blood is thicker than water and people are always going to want to take care of their own families as priority number one. But it is interesting!

Philip Seymour Hoffman's will goes public

What a loss. Philip Seymour Hoffman, the amazingly talented Oscar-winning actor, died of an apparent heroin overdose on February 2. He had accumulated considerable wealth, with an estate rumored at $35 million. He was father to three young children. And according to reports, Hoffman anticipated his life might be cut short by the longtime drug addiction he battled, not fully successfully.

Hoffman's will went public this week when it was filed in New York surrogate court. His estate plan reveals something of his values and personality, requesting that his son - the only one of his three children born when the will was drafted in 2004 - be raised in Manhattan, or if not possible, in Chicago or San Francisco. "It is my strong desire that my son, Cooper Hoffman, be raised and reside in or near the borough of Manhattan... so that my son will be exposed to the culture, arts and architecture that such cities offer," the will states.

From a legal point of view, Hoffman's estate plan is somewhat confounding. He never revised his will in the ten years during which his two other children were born. His will does not reference his "children," instead referencing by name just his one son, Cooper. Although estate laws in New York will undoubtedly protect the two daughters born since the signing of the will, that is going to add additional complexity, delays and cost to the probate process. I always urge clients to revisit their estate plan whenever any significant life event occurs. Death, illness, a change in financial fortune - certainly a birth - fall into that category. 


Hoffman left most of his estate to Mimi O'Donnell, the mother of his three children. They were not married, so federal estate taxes will significantly erode what the family gets. Since Hoffman was a resident of New York, which unlike Florida has its own estate tax, Hoffman's estate will also pay out a hefty chunk of change to the state.

The other question that begs to be asked is this: Why would someone with such a public profile rely on a will as the crux of his estate plan? The probate process is a public one. Had Hoffman been my client, I would have steered him away from that approach, and suggest he use a revocable trust in order to protect his family's privacy. Moreover, probate can tie up an estate for some time. It is said that O'Donnell has requested that the will be probated in an expedited fashion, which could signal that the family cannot wait and needs the cash now.


We also now know that Hoffman's will establishes a trust with his son as the beneficiary, to pay for his son's "education, support, health and maintenance." Hoffman directed that half be distributed to his son at age 25, and the remainder at age 30. There's no question that this is preferable to releasing all the money when a beneficiary attains the age of legal majority. Still, as readers of my blog know, my experience has been that many of today's youngsters are far slower to mature than the prior generation was, at least as far as money management is concerned. Not every child becomes financially savvy at 25, or even 30. Had I been advising Hoffman, I would have suggested that he consider putting more thoughtful strings on the timing and method of distributing the funds Cooper will receive, which will probably amount to the millions.

Moviegoers and theater-lovers will surely miss Hoffman. Estate planning aside, he leaves behind an extraordinary artistic legacy.

Estate of mysterious heiress still not settled

Clark (right) with her father and sister

The Huguette Clark estate has been in limbo for three years. A tentative settlement was reached in the fall of 2013 after several contentious legal battles, but the lawsuits just keep coming. The entire saga is worthy of a long-running soap opera - with ample material for several spinoffs, too. Money, greed, family, and questionable estate planning are the main plot points. While mind-boggling sums of money are at stake in this conflict, there are lessons to be learned for those with more modest means, too.

In case you've been hiding under a rock for the past three years, here are the basics: Huguette Clark was the highly reclusive heiress to a vast mining and railroad fortune. Clark was briefly married and never had children, and her one sibling died at a young age. At the time of Clark's passing, her only family members were 20 very distant relatives, the product of her father's previous marriage and with whom she had little or no contact.

Pathologically shy, Clark lived a hermit-like existence in a palatial 42-bedroom apartment on New York City's tony Fifth Avenue. She had lived with her mother there until her mother died in 1963. Clark rarely ventured out over the years except to purchase clothing for her extensive doll collection, valued at $1.7 million. In 1991, an emaciated Clark was carried out of her apartment; she had skin cancer on her face so advanced that she is said to have resembled a leper. She was admitted to Beth Israel Hospital in New York, where she was treated and returned to relatively stable condition. But even then, she never checked out, continuing to reside in the hospital until her death two decades later. She remained there under the alias Harriett Chase, in an unmarked room to protect her privacy The only people who saw her during that time were her accountant, lawyer, and a team of private nurses. 

In the many lawsuits that have cropped up since her death, the hospital and its supporters have argued Clark chose to remain in the hospital, an arrangement that suited her because it provided security and a surrogate family. Others allege she was coaxed to remain there and her whereabouts kept hidden from the world, so that those around her could pressure her into giving them money. And give she did, regardless of why she remained at the hospital. Over the tears the heiress provided frequent and extravagant gifts into the millions to the people in this tiny inner circle - her physician, nurses, lawyer, etc.

When Clark died at age 104 in 2011, among the assets in her $307 million estate were the New York apartment; a 22-room mansion in New Canaan, Connecticut; and a 21,000 square foot Santa Barbara, California home overlooking the Pacific housing an original Renoir and other valuable paintings, a Stradivarius violin, and an original edition of "Paradise Lost." All her homes had been meticulously maintained over the years, even though Clark never went to any of them.

Two wills were found. The first will, signed March 7, 2005, left everything to her distant relatives.  It had the word "revoked" handwritten and a line drawn through the first page. The second will, signed just a few weeks later on April 5, 2005, cut out the relatives, stating: I intentionally make no provision in this my last will and testament for any members of my family, whether on my maternal or paternal side, having had minimal contacts with them over the years. Instead, the new will left $1 million to Beth Israel Hospital; $100,000 to her personal physician, Henry Singman; additional gifts to the caretakers of her various properties and to her lawyer and her accountant; the California property to a foundation to be established to promote the arts; a Monet painting, "Water Lillies," to Washington, D.C.'s Corcoran Gallery of Art, an institution her father had supported; and her collection of dolls and dollhouses and 60% of the rest of the estate to her longtime daytime nurse, now-retired Brooklyn resident Hadassah Peri.

You don't need a degree in rocket science to figure out what came next: The relatives contested the April 2005 will, claiming that Clark had been coerced into excluding them from her estate. After years of legal back-and-forth, a tentative settlement was reached in September 2013. Under the terms, the relatives would divide $34.5 million among themselves. Clark's attorney and accountant would be stripped of their bequests. The doll collection would go to the arts foundation, not Peri. The hospital would get $1 million. Peri also would be required to return $6.7 million of $31 million she received from Clark during the heiress' lifetime, and also forego  the $30 million earmarked for her in Clark's will. (There are still other, separate lawsuits pending: the executors of the estate are trying to claw back some of the money that Clark gave out over the years; Beth Israel Hospital is also being sued.)

But this January, there was a new turn of events: Geraldine Coffey, Clark's night-duty nurse for two decades, said she would not agree to the settlement, threatening to derail it. She claims she was not consulted during the negotiations, and that, in addition to the gifts she'd received during Clark's lifetime, Clark had also told her she would be provided for in her will.  Coffey received about $1 million in gifts before Clark passed on, monies used to purchase real estate and pay her children's tuition, in addition to a $130,000 annual salary.. Attorneys for the estate have countered that Coffey caused Clark distress by pressuring her for money. The matter is due back in court this month.

Of course, the conflict is also generating enormous fees for the lawyers involved.

These high-profile legal conflicts over huge fortunes are intriguing, to be sure, and Clark's eccentricity and unusual circumstances make this one more intriguing than most. However, at its heart it is an everyday and common drama: An isolated, elderly person whose competency is questioned along with the motives of those around her, and estate planning documents that arouse suspicion. Multi-millionaires or not, all of us should take steps to ensure that in death, our wishes are carried out, and those we care about most are protected. If you need help to create a sound and thoughtful estate plan,  contact our lawyers for a consultation.

They're not like Big Macs: Holographic wills not admissable in Florida

From Fairbanks to Fort Lauderdale, a Big Mac is a Big Mac, sesame seed bun, special sauce and all. The situation is quite different when it comes to wills. Every state has its own laws. A will that is valid in one state may be tossed out of the probate court in another state. Floridians are well advised to keep this in mind, since so many Floridians own property in other states or move here with wills drafted and executed in other states. 

One major difference among state laws is the validity of a holographic will, in other words, one written in the testator's own handwriting which is not necessarily witnessed by two witnesses. Some states allow them, including New Jersey, Nevada, Colorado, Texas, Tennessee and Virginia. Florida does not. If you are a legal resident of Florida but at the time of your death have a holographic will valid in another state,  the Florida Probate Court will not accept it. That means that your assets will be distributed under Florida intestacy laws, not according to the wishes in your will.

Another complication may arise if you live in a state that recognizes a holographic will but if you own property in Florida. In a recent case, Lee v. Estate of Payne, the decedent, a Colorado resident, had a holographic, unwitnessed will valid in that state. The will sought to dispose of the decedent's Florida property. Unfortunately for the beneficiary, Florida would not accept the will because it lacked the two witnesses required by Florida law.

The bottom line: If you move to Florida from another state, or if you reside elsewhere but own Florida property you wish to pass under your will, you are well advised to have a qualified Florida estate planning attorney review your existing will. 

Are you the family bank?

Americans lead increasingly complicated family and financial lives that make for challenging estate planning and retirement planning. An interesting new survey by Merrill Lynch and Age Wave puts some hard numbers on these trends we see in our Florida estate planning practice. The 2013 study, "Family and Retirement: The Elephant in the Room," polled 5,400 Americans of various ages about issues related to retirement. Here are some key findings. Do you recognize yourself and your family?

Are you the family bank? 

The study found that in most families, there is one individual who relatives view as the "family bank." (That is usually our client!) A majority of those age 50+ have given money to family members on a one-time or continuing basis. 

No surprise: The study found that the family bank is usually the parents. More than two thirds of parents age 50+ who were polled reported providing some form of financial support to adult children during the past five years, and one in five parents has an adult "boomerang" child living at home. Parents said the money they gave children went to pay mortgage or rent (20%), phone bills (18%), car payment (17%), health care (15%), and student loan repayment (11%). However, the majority of parents were not sure precisely how their gifts were spent by their children.

While generosity is a great thing, clients should be careful about giving away too much. Who will take care of YOU if your retirement funds run short?


Do you have stepchildren or step-grandchildren? 

If you are in a blended family, welcome to a growing club... and you had better attend to your estate planning. Divorce rates have resulted in a high incidence of blended families: Two in five of those polled said their family includes stepchildren. One third admitted that having stepchildren complicates their estate planning. This comports with our observations, as clients frequently express concern about making sure their assets pass to their own children and grandchildren, not in-laws. (There are several strategies to achieve that goal, including the increasingly popular Heritage Trust.)



Do you fear you will become a burden on your children? 

There is widespread fear about outliving one's money, getting sick and becoming a burden on one's children. The study found older people worry most about getting Alzheimer's. Surprisingly, only 37% of respondents thought they would eventually need some form of costly long-term care! In reality, 70% are likely to need these services for a period of time.

Nearly 90% of those polled said they would prefer to remain in their own homes if they could no longer care for themselves and needed long-term care. The biggest concern: relying on a family member for actual physical care. Living with a family member is considered just as undesirable as living in a nursing home. Despite these concerns, 67% of those polled admitted they have made no plans to avoid having to live with a family member if they are no longer capable of living independently. Thus, long-term care planning, from investigating long-term care insurance to Medicaid planning, should be included in every person's estate planning goals.

Are you avoiding "the conversation?"  

In our law practice, we encourage clients to provide their families or other trusted individuals with basic information about their estate plans and health care preferences. However, the study showed that most people have not had this conversation. More than 56% of parents over age 50 said they have not discussed estate planning or financial issues with their kids, be it wills, inheritances, or advance directives. They cited three main reasons for this: avoiding family conflict, avoiding plain old discomfort, and the belief that in the end, such discussions won't change anything.

Read the entire survey here.

Football coach's heirs cry foul

Deceased college coach Jim Carlen's three children are in court, claiming their father fumbled his last will. Or to put a finer point on the metaphor, that he was tackled by his second wife.

A highly regarded football coach at the University of South Carolina from 1975 to 1981, Carlen enjoyed a lucrative post-football career in banking and real estate. He died in 2012 at age 79 after several years of cognitive decline that first manifested itself in 2009, when he gave up driving. His estate is estimated at about $10 million.

Carlen's first marriage to wife Sharon produced three children. In 1983 he remarried and had a child with his second wife, Meredith. According to an August 1, 2013 article in the newspaper The State, the children from his first marriage allege that their father lacked the mental capacity to know what he was doing when he revised his will in 2010. That will, filed with the  probate court after his death, differed from all his prior wills in that it left nothing to his children and everything to Meredith. The children are petitioning the court to replace Carlen's 2010 will with his 2007 will. They claim that the later version is the product of undue influence over someone with diminished mental capacity, and that the 2007 will reflects their father's true wishes. The State article quotes from their court petition:

"In late 2010 Carlen was driven from Columbia to the law office of an attorney in Hilton Head Island...While in Hilton Head, Coach Carlen was apparently presented with a document entitled Last Will and Testament … which he purportedly signed...Unlike the 2007 will which provided for both Coach Carlen’s children and his wife, Meredith, the 2010 will left all of his property to his wife Meredith and left nothing whatsoever to his children or grandchildren: not money; not personal property; not a photograph; (nor) memorabilia from any point in Coach Carlen’s career or a token for them to remember him by...Carlen was made to execute a new power of attorney in favor of Meredith, empowering her to assume full control over all aspects of his financial affairs...After she assumed control over Carlen’s finances, she stopped making annual tax-free gifts to the three children – gifts that Carlen customarily made.Meredith led the Carlen children to believe that she may have lacked the financial resources to provide for Coach Carlen’s basic needs. Clearly this was not the case..."

Among the assets in Carlen's estate are gold coins valued at $538,000; close to $2 million in Coca Cola stock; interest in several pieces of property totaling about $300,000; and a half interest in an umbrella company that oversaw some of Carlen's business interests, worth about $3 million. 

In the fullness of time, the matter will be decided in the courts, at great expense to all concerned in time, trouble and legal fees.For now, here's my takeaway from the Carlen estate planning fiasco: If you are the testator (person creating a will), you should take steps to lessen the possibility of your estate being challenged, particularly if you anticipate that there may be disgruntled heirs out there who will challenge it. Steps to take include:

• Make sure your will, trust, power of attorney or other documents have every legal "i" dotted and "t" crossed and are drafted and executed in conformity to Florida law if you are a Florida resident, or in conformity with the state in which you are domiciled. 
• Consult with a qualified, experienced estate planning/elder law attorney. He/she should take the time to discuss the ins and outs of your family and financial situation, not just quote you a fixed price and grind out documents through a boilerplate process. Beware of do-it-yourself forms and office supply forms.
• If  there are potential concerns about your mental capacity, your lawyer may advise you to see your physician, psychologist or psychiatrist to obtain documentation of your competency. Note that declining capacity does not necessarily mean you are incapable of understanding and executing an estate plan. Even if someone is "slipping," he/she may be perfectly lucid at times and capable of doing so. Each individual's situation is different and must be assessed individually. Your attorney will know what questions to ask and how to handle the situation for your and your family's protection.
• Do not have beneficiaries present at your consultation with your attorney. A competent and skilled estate planning lawyer will, rightfully, exclude such an individual from your consultation, at least in the beginning stages, and even if you and the other person insist that it's fine with both of you. This is how your attorney protects you, as well as your beneficiary, from possible future claims of undue influence or fraud.
• You should select your estate planning attorney. Your beneficiary should not. If you use an attorney selected by the beneficiary, you open the door to allegations of undue influence, as the Carlen case illustrates.
• Your attorney may suggest that you use a trust, rather than a will, as the centerpiece of your estate plan. Because a trust is not public record, it provides additional insulation against possible attack.

On the other side of the coin, if you believe that you have been improperly "cut out" of a loved one's estate plan because of undue influence or fraud, or because the testator did not have the mental capacity to know what he/she was doing., be prepared: This type of litigation is usually a long and expensive process, with no guarantee of success. 

Sopranos star Gandolfini was prepared for the unthinkable

Unlike many deceased celebrities whose faulty estate plans - or complete lack of them - come to public attention, James Gandolfini was well-prepared for the unthinkable. And the unthinkable is what happened last month, when the 51-year-old star of The Sopranos died  while vacationing in Italy. A father of two and husband, Gandolfini executed his will on Dec. 19, 2012, just months after the birth of his second child, Liliana. 

His will was filed today in New York Surrogate Court. As my readers know, a will is a public document, so we now know a good deal about Gandolfini's distributions. In fact, the public now even knows where Gandolfini resided, since the address of his Manhattan home appeared in the document. 

The bulk of the estate, estimated at around $70 million, is going to his 13-year-old son Michael, a product of his first marriage. Michael's share is held in trust until he reaches age 21; he has first dibs on that Manhattan apartment; and he also inherits his father's jewelry. He and his half-sister will ultimately split an interest in their father's home in Italy. Gandolfini also provided for his wife, several relatives, his personal assistant, godson, and friends. The executors of his estate (in Florida, executors are called Personal Representatives) are his wife, his sister, and his attorney.

Here is Gandolfini's will, published by the NY Post:

James Gandolfini Will by New York Post

Florida residents: how the Defense of Marriage Act ruling may affect you and your loved ones

The Supreme Court last week struck down the 1996 federal Defense of Marriage Act, which defined marriage as a union solely between a man and a woman. The 5-4 ruling found DOMA unconstitutional because it denied same-sex couples equal protection under the Fifth Amendment of the U.S. Constitution. The ruling means that same-sex legally married couples should be entitled to all the same rights and benefits under federal law as opposite-sex married couples. That's 1000+ rights and benefits. 

For couples who were married in and reside in the District of Columbia or one of the twelve states that currently recognize gay marriage, the situation is a clear-cut and positive development. The situation is less clear for same-sex couples who reside in Florida and have been legally married in another state, because Florida does not recognize the legality of same-sex unions. The Florida Constitution, as amended, bans same-sex marriage and expressly does not recognize same-sex marriages from other jurisdictions.

In this post I clarify what we now know, and still have yet to learn, about the impact of DOMA's reversal on same-sex couples residing in Florida who have been married elsewhere, with emphasis on estate planning, life planning and long-term care planning issues. I also point out how the Supreme Court ruling may affect anyone planning his/her estate who wishes to include a beneficiary who is in a same-sex marriage ,regardless of where that beneficiary resides.

Federal Benefits for Same-Sex Married Couples

Some legal experts have questioned whether spouses in same-sex marriages living in states like Florida will be eligible for all the federal benefits and rights accorded to straight married couples, notwithstanding DOMA's reversal. One early signal that they probably will: Just 48 hours after the Supreme Court ruling was issued, the U.S. Immigration and Citizenship Services Agency awarded a green card to Bulgarian immigrant Train Popov, a man, who had been married in New York to another man, American Julian Marsh. The couple lives in Miami. Based on this development, one can reasonably presume that other federal agencies will fall into line, and that same-sex married couples living in Florida will have access to the full range of federal benefits that provide preferential treatment for spouses.

That said, it is important to point out that different federal agencies use different standards to identify who is or isn't married. Some agencies, including the Social Security Administration, Internal Revenue Service and Veterans Administration have historically used place of residence as the criterion, meaning that they consider a couple to be married only if their domicile considers them married.  From that point of view, a same-sex couple who has been married in, say, Vermont and who now resides in Florida, would not be considered married. Obviously this is a grey area of the law that has yet to be resolved.

Assuming for the moment that all federal benefits will apply to same-sex married couples regardless of where they live, the federal benefits they will receive include:

• Federal estate tax breaks:  Unlimited marital deduction when one spouse passes his/her estate to the survivor. (Prior to the DOMA ruling, any amount in excess of $5.25 million passed to your partner was subject to federal estate tax.) A surviving same-sex spouse may also use any unused portion of the deceased spouse's exemption (portability).

• Social Security advantages: Like their heterosexual counterparts, a surviving spouse in a legal same-sex union may opt to collect the decedent's Social Security benefits if those benefits are greater than what the survivor is currently receiving. Also, while both spouses are alive and collecting Social Security, the lesser-earning spouse can elect to receive 50% of the higher-earning spouse's benefit.

• V.A. Benefits: All the benefits that heterosexual married couples have enjoyed are now available to same-sex marrieds. For example, if the spouse is entitled to pension with aid and attendance, the survivor will also be entitled to those benefits, provided of course that he/she meets all other criteria. 

• 401-ks:  Under federal law, the spouse is the automatic beneficiary. Therefore, if you are legally married in a state that recognizes same-sex marriage, your spouse will automatically be your beneficiary (whether you like it or not). 

• Individual Retirement Accounts: A deceased spouse's Individual Retirement Account can now roll over into the survivor's account without being taxed, and the survivor may take minimum required distributions based on his/her own life expectancy, and then let the ultimate beneficiary stretch it out.

• Medicare: All the spousal privileges and benefits that apply to opposite-sex married couples are now available to same-sex marrieds. Spouses of Medicare recipients can enroll in the program even if they lack the requisite work history. 

• Income taxes: Same-sex married couples may now file joint returns, which is generally advantageous.

 

What has NOT changed at the Florida state level for same-sex married couples

 
As noted above, nothing has changed at the state level, at least for now. Florida laws affording preferential status to married couples do not apply to same-sex married couples, despite the marriage being recognized as legal in a different state. Among the Florida benefits still NOT available to same sex marrieds are:

• The right to an elective share of the spouse's estate.
• The right to a life estate in your spouse's homestead, or one-half ownership in that property.
• Consideration as the natural health care proxy for your spouse, second only to a court-ordered guardian.
• Same-sex spouses may not hold assets as tenants by the entireties, which heterosexual couples may do and which provides creditor protections.
• If a same-sex spouse dies intestate, the survivor is entitled to nothing. Married opposite-sex survivors are entitled to 50% of the estate if there are children from the decedent's prior marriage, or 100% if the decedent has no children from a prior relationship.

At this juncture, it may be wise for committed same sex couples who reside in Florida to consider being married in a state that recognizes same-sex unions. Although it obviously will not change the nature of the relationship from the point of view of Florida law, the spouses will at least be considered married for federal benefits purposes.

If you are in a same-sex marriage recognized in another state, but you are domiciled in Florida, you must take particular care with your planning to ensure that you and your spouse are protected, since the state provides you none of the protections available to same-sex married couples. Contact our offices for the expert advice required for your situation.

A grey area: Long-term care Medicaid benefits for same-sex married couples

Florida Medicaid regulations are a compilation of both federal and state statutes. Therefore it is unclear as to how the DOMA ruling will play out for Florida same-sex couples who are legally married in other jurisdictions and who wish to do Medicaid planning to protect themselves and one another from the cost of long-term care. Two tools commonly used by elder law practitioners in Medicaid planning, spousal refusal and unlimited interspousal transfers, may not be available in Florida to such couples.Only in the fullness of time will we know how these issues will be resolved by the courts. Meanwhile, our experienced Florida elder law attorneys can give you the most accurate and up-to-date advice.

Estate planning if one or more of your beneficiaries are in same-sex marriages

The Supreme Court ruling opens up sticky problems for those planning their estates and whose intended beneficiary (or beneficiaries) is in a same-sex marriage. 

For example, suppose you are a Florida resident and your daughter Ann resides in Massachusetts, where she was married to her spouse, Susan. If Ann predeceases Susan, do you or do you not want Susan to get Ann's share? If your will identifies Ann's "spouse" as the contingent beneficiary, will the Florida Probate Court recognize the validity of that language and allow Susan to receive the bequest - and is that what you desire? If it is, in my view it would be better to omit the word "spouse" and instead identify Susan by name.

Powers of appointment create another area of uncertainty. Sometime a client who wants to leave money to someone in a trust does so with a general power of appointment; meaning the beneficiary is permitted to leave the funds to anyone the beneficiary chooses. In other instances, someone will leave funds under a limited power of appointment, restricting to whom the beneficiary may leave the funds, generally that beneficiary's "spouse and lineal descendants." As you can imagine, DOMA's reversal opens up a legal can of worms with respect to limited powers of appointment. Can you now put restrictions in your limited power of attorney restricting the gender of the beneficiary's spouse? If your limited power of appointment states that your son can only leave his share to his "wife," does that disqualify a same-sex spouse, and is that what you want?  Our highly experienced estate planning attorneys can anticipate these potential problems and draft your estate planning documents in a way that ensures your wishes are carried out in this new legal world.
 
In conclusion, we can look forward to many test cases, lawsuits and rulings on all of these matters over the coming months and yes, even years. Check our website and this blog to keep up with these developments and what they may mean for you and your loved ones.

To read the Supreme Court decision, click here. 

What happens to the money of a Florida resident who dies without a will?

Dying intestate - without a will - rarely creates headlines. Generally it creates only confusion and  unnecessary expense for those left behind.

Unless you're Roman Blum. The Staten Island, New York resident's death is making headlines because he left behind $40 million - and absolutely no clue as to how he wanted it distributed.

A Holocaust survivor and real estate developer, Blum was not married at the time of his death, nor did he have children. The public administrator in the Richmond Surrogate Court is searching for any living distant relatives. If none can be found, the money will pass to New York State. The case would be handled in the same fashion by Florida if Blum had been a Florida resident.

Speaking to The New York Times, Blum's accountant Mason Corn said, “I spoke to Roman many times before he passed away, and he knew what to do, how to name beneficiaries. Two weeks before he died, I had finally gotten him to sit down. He saw the end was coming. He was becoming mentally feeble. We agreed. I had to go away, and so he told me, ‘O.K., when you come back I will do it.’ But by then it was too late. We came this close, but we missed the boat.”

Many mysteries follow Blum to the grave. Did he have a will that can't be located? If so, it's as good as not having one. Did he not do one because he did not wish to face his own mortality? Or did his miraculous escape from the Nazis make him think his luck would never run out?

If a Florida resident dies without a will or other instrument directing the distribution of assets, the estate is distributed to the decedent's heirs according to Florida intestacy law.  If there are no blood relatives, as in the case of Roman Blum, the estate goes to the State of Florida. Few people would choose to leave what they've managed to accumulate to the government (one exception is my late client Maria Woods, who mindfully chose to do just that). Even if someone doesn't have relatives, there may be a particular charity that is meaningful to the person that could greatly benefit from the gift. 

Consult a Florida estate planning attorney to discuss who you want to get your heard-earned assets when you pass away.

Read more about Roman Blum here.
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Hizzoner's will goes to probate

Mayor Ed Koch's last wishes were made public yesterday when his will was filed in New York Surrogate Court. Hizzoner died on February 1, leaving New Yorkers -- and millions of Florida transplants whose hearts are still in the five boroughs - missing one of New York City's most colorful characters. According to the Wall Street Journal, Koch's estate is estimated at about $11 million. He left the bulk of his assets to his sister, Pat Thaler, who he also named as Personal Representative (called an "executor" in New York) of his estate. His will also includes bequests to the LaGuardia and Wagner Educational Center at the City University of New York, to his longtime secretary, and to his late brother's widow. 

Koch's estate was not structured to avoid probate. Nor did he do the sophisticated planning that could have saved on taxes: his estate owes about $2 million in federal estate taxes and $1.5 million in New York State estate taxes. Given that Koch was an astute lawyer, one can surmise that he was well aware of the estate tax liability but chose not to take steps to keep the money out of the government's hands. A public servant to the end! 

Read more about Florida wills and probate here.

Read the Wall Street Journal article here.