Wills and Trust Chapter 1

CHAPTER 1 – DONATIVE FREEDOM, PROBATE ESTATES, AND NONPROBATE ASSETS

  1. Introduction

What’s a will? : A written document to dispose of property upon somebody’s death. Only becomes effective after a person’s death.

A will can also be executed only to name a personal representative (a person who administers the probate estate).

What’s a codicil? Usually, an addendum, an amendment to a will.

Devising is giving the property through a will. A person who received it is a devisee.

A beneficiary is a person who receives something through a will, but the difference between beneficiary and devisee is that even if there is no will (the person died intestate), then the heir is also a beneficiary.

A person who dies with a will is a testator.

What is a probate? Once a person dies, the court needs to validate the will. The procedure is called probate of a will.

What is a probate asset? All property, real or personal, wherever located, owned only by the decedent.

  • i.e. cash, bank account, jewelry,
  • Bank account with a beneficiary on it? Not a probate asset because there’s another party.

Joint tenancy with right of survivorship is another way to avoid probate. Because when one person dies, everything goes to the other person.

Another way to avoid probate is when your married (by the entirety).

There is no absolute right to dispose of your property.

Federal government is not governed by federal statutes.

Business interest:

  • If you are the sole owner, then the corporation is a probate asset.
  • If you are a shareholder, than the probate assets are only your shares.
  • Contingent property interest can also be inherited.
  • Intangible property can also be inherited (i.e. intellectual property rights).

Real estate:

If it was solely owned, it’s a probate asset.

If someone dies in another state, but has property in Florida, then we do an ancillary probate.

What is a trust? A grantor has property, transfers it into a trust, and the trustee holds it for the benefit of someone else.

  • A trust avoids probate.

What is a community property? Everything that was bought after marriage by one of the spouses belongs to both spouses together (in FL they don’t have community property).

Are life insurances subject to probate? No, because there is a beneficiary.

Is car insurance/house insurance/hazard insurance probate asset? Yes. The proceeds of the insurance are probate assets.

Probate Assets:

  1. Generally assets solely owned by decedent.
  2. Excludes homestead
  3. Excludes Non Florida Real Estate
  4. Excludes property held by joint tenancy with right of survivorship or tenancy by the entirety.
  5. Excludes life insurance proceeds and bank accounts with a beneficiary.
  6. Excludes property held as trustee.