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The Major Advantages of Living Trusts in Florida

Blade • May 20, 2022
Living Trust — Deerfield Beach, FL — Blade & Blade PA

What is a Living Trust?

A Florida living trust is an estate planning legal instrument that people use to transfer the ownership of their most valuable assets for the benefit of their spouse or other people they designate.


The person setting up a living trust in Florida is the trustmaker, settlor, or grantor. The trustmaker creates the terms of the living trust legal document or contributes to the property. On the other hand, a trustee is a person who ensures that the beneficiaries receive benefits according to the provisions of the trust agreement. The trustee is a fiduciary of the trust, meaning that they guarantee the settlor’s wishes will be honored according to their intentions. The initial trustee is usually the grantor. The person who benefits from the trust after the grantor’s death is known as the beneficiary. The beneficiary has a present or future interest in a trust. Unlike the so-called death beneficiaries, the grantor is a lifetime beneficiary because they have full access to the assets while still alive.


Establishing a living trust involves changing the title over the property from the grantor to the trust. That means that, upon creating the trust, the grantor owns the assets as a trustee.


Governing Law

Chapter 736 of the Florida statutes (also known as the Florida Trust Code) regulates living trusts. The Code applies to express trusts, charitable or noncharitable trusts, or trusts created under law, judgment, or decree. Contrarily, it does not apply to constructive trusts, conservatorships, and custodial arrangements. Furthermore, it does not extend to business trusts, voting trusts, or trusts that have the primary purpose of paying debts, dividends, interests, wages, or employee benefits.


The Advantages Of Setting up a Living Trust In Florida

A Florida living trust offers several benefits that other estate planning instruments lack. Below are the most common advantages of establishing a living trust.


1. A Living Trust Is Revocable

A living revocable trust enables the grantor to revoke it at any time. Revoking the trust is an invaluable tool for adjusting it to the newly changed circumstances. Under Florida law, the settlor can revoke the trust without the consent of a person holding an adverse interest or a trustee. In practice, revoking a living trust means you terminate the trust and re-establish the property. Because assets in a trust are not the grantor’s property, you must transfer it back and re-list it as yours after terminating the trust. The flexibility of a living trust is an indispensable tool if you ever change your mind after setting up a trust.


2.The Possibility of Setting up a Shared Trust

One of the unique advantages of a living trust in Florida is establishing a shared revocable living trust. That is an excellent benefit for spouses who co-own the property. If they intend to leave all property to each other, that appears as a perfect solution. Conversely, if you are recently married or own most of your property separately (acquiring it before marriage), establishing individual trust is better.


3. Establishing a Living Trust Avoids Probate

Probate is the court-supervised procedure of collecting the assets of a deceased person and distributing them to inheritors. Probate is public, meaning that everything shared during the process becomes part of a publicly accessible record. Regardless of will, a probate process will take place. It is known as a time-consuming, expensive, and emotionally draining procedure. The only way to avoid probate is to create a living trust because it does not need court approval. If there is a living trust, the living trust owns the property, not a deceased person. The trustee administers the property, transferring it to beneficiaries. Hence, there is no need for a probate process. If the descendant owned the property in multiple states, each state conducts a separate probate procedure. But, if the property in different jurisdictions is in a living trust, the family will avoid multiple probates in each state. However, you will not avoid probate if you did not transfer the title on the property to a living trust. Setting up the trust (without title transfer) does not automatically lead to avoiding probate.


4. Avoiding Guardianship

Another advantage is avoiding public guardianship. Instead of the guardian taking over the administration of the property, the successor beneficiary will manage the property if the grantor becomes incapacitated and unable to run the trust.


5. An Option of Transferring Assets After the Death

Under Florida law, a living trust enables you to wait before transferring assets into the trust. In other words, you do not have to move any property upon establishing the trust. However, that is only possible in the case of a married couple. It is possible to transfer the ownership of the property into the trust after the first spouse dies.


6. Asset Protection for Future Trust Beneficiaries

The common misconception is that living trusts in Florida enable asset protection for the grantor. The Florida Trust Code explicitly provides that no asset protection from creditors is possible if the trustmaker establishes the trust for his benefit. However, a living trust can provide significant protection to the assets of beneficiaries. The key is to design trust agreement provisions so that the trust property remains in the interest of children, spouses, or other designated beneficiaries. By establishing the trust for the advantage of your children, you will provide them with substantial asset protection.


7. Homestead Exemption

There are two types of homestead exemptions in Florida. First, there is an exemption from forced sale. It protects homeowners so that their home is safe from creditors. Next, there is a tax exemption meaning that your property is tax-free to the extent of the value of the homestead. Homeowners in Florida enjoy the benefit of keeping the homestead exemption even after putting their estate in a revocable living trust. The advantage of homestead exemption applies equally to tax exemption and homestead exemption from creditors.


Conclusion

Creating a revocable living trust in Florida will provide you with significant advantages. Avoiding expensive and burdensome probate procedures and guardianship are some of the benefits. Apart from that, you can revoke it at any moment until death, keep homestead exemption, and provide asset protection for your beneficiaries. Besides, you can create a shared trust or ensure that your assets move into the living trust after your death.

March 24, 2025
As the New Year begins, many of us take the opportunity to set goals for personal growth, financial stability, and overall well-being. While these resolutions often include exercising more or saving money, one essential goal that often gets overlooked is estate planning. For Florida residents, the importance of establishing or updating an estate plan cannot be overstated. Here’s why making estate planning a priority this year is one of the best decisions you can make for yourself and your loved ones. What Is Estate Planning? Estate planning involves preparing for the management and distribution of your assets in the event of your incapacitation or passing. A comprehensive estate plan typically includes a will, powers of attorney, healthcare directives, trusts, and beneficiary designations. It’s not just for the wealthy—anyone with assets, children, or specific wishes regarding their healthcare or property can benefit from having a plan in place. Why Is Estate Planning Critical in Florida? Protecting Your Loved Ones Florida’s probate process can be lengthy and costly, potentially causing stress and financial strain for your family. By having a well-prepared estate plan, you can simplify or even avoid probate, ensuring your loved ones have access to the resources they need without unnecessary delays. Avoiding Intestate Succession If you pass away without a will, Florida’s intestate succession laws dictate how your assets are distributed. This can lead to outcomes that may not align with your wishes. Creating a clear estate plan allows you to determine exactly who receives what, giving you peace of mind that your legacy is protected. Addressing Unique Florida Considerations Florida’s homestead laws, which protect your primary residence from creditors, and its tax-friendly environment make estate planning especially advantageous. However, these laws also introduce complexities that require careful planning to ensure your assets are handled as intended. Preparing for Incapacity Estate planning isn’t just about what happens after you’re gone. Documents like a durable power of attorney and healthcare surrogate designation ensure your financial and medical decisions are made by someone you trust if you become incapacitated. Steps to Start Your Estate Plan Take Inventory of Your Assets: Identify your property, financial accounts, and other assets. Don’t forget to account for non-tangible items like digital accounts or intellectual property. Define Your Goals: Decide how you want your assets distributed and who should make decisions on your behalf if you’re unable to. Consult an Estate Planning Attorney: Laws vary by state, and working with an attorney familiar with Florida’s estate laws ensures your plan is legally sound and optimized for your situation. Blade & Blade, P.A. offers a free consultation which can be done in person at our offices, Zoom or by phone. Update Beneficiary Designations: Ensure accounts like life insurance, retirement funds, and payable-on-death accounts reflect your current wishes. Communicate with Your Loved Ones: Discuss your plans with family members to minimize confusion and potential conflicts in the future. Make It a New Year’s Resolution Starting or updating your estate plan doesn’t have to be daunting. Break it down into manageable steps and set realistic timelines to complete each phase. By prioritizing this goal early in the year, you can approach the months ahead with confidence, knowing you’ve taken a significant step toward securing your family’s future. Final Thoughts Estate planning is not a one-size-fits-all process. Your plan should be tailored to your unique needs and Florida’s specific legal environment. As you set your New Year’s resolutions, consider the peace of mind and security an estate plan provides. It’s an investment in your legacy and your loved ones’ well-being—one that will pay dividends for years to come. Take the first step today and make 2025 the year you prioritize estate planning. Your future self—and your family—will thank you. Give us a call at 954-429-1200 to schedule a consultation!
Estate planning lawyer in Boca Raton, FL advising clients on wills and trusts at an office meeting.
March 9, 2025
Estate planning lawyers in Boca Raton, FL, can help with wills, trusts & asset protection. Secure your future! Call Blade & Blade P.A. at (954) 429-1200 today.
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