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Trusts & Estates Law/California Trust - Have Moved to Florida

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Question
My wife and I have a “Revocable Trust” along with the usual bells and whistles:  I.E.  1. Last Will and Testament for Husband [me];  2. Last Will and Testament for Wife [We are both still living]. 3. Durable power of attorney for both of us naming the other.  All documents were completed [signed and witnessed] in California in 1988 and have not  been looked at or modified since then. The only Items transferred to the trust are a timeshare [1 week ownership]  in Ventura, California.

In 1995 we moved to Florida  and plan to remain here until we die. We are now in our mid seventies.  When we moved, we sold our home in California and bought a home in Florida which we have not put into the trust.  Are we okay with the California Documents or do we need to add something to it or draw up new documents entirely. I would like to avoid future probates.

Answer
Thanks for your question.  Under the "full faith and credit" clause of the US Constitution if a document (like a will or a trust) was valid in the state where it was established, it will be honored in the other 49 states ... so your trust should be honored in Florida unless it was flawed to begin with.

But you will not avoid probate on your assets unless your assets are "titled" in the name of the trust.  So if you own a house that's not in the trust, it will need to go through probate.  Likewise, any investment accounts, bank accounts in only one name, etc. (NOTE:  do not put IRAs, 401ks, Roths, and other retirement accounts into the name of the trust - that will trigger income taxes - instead, the trust can be the beneficiary of those accounts, if that's the appropriate solution for you).

In addition, your trust probably refers to "community property".  It sounds like the only "community property" you might still own is the timeshare in Ventura.  Only a few states recognize community property - that doesn't mean that it's illegal in other states (such as Florida), but it's irrelevant in those states, and I doubt that many (if any) Florida lawyers understand it ... and if the lawyers who will be involved in settling your estate don't understand the community property concept, it might be significantly more expensive to "administer" the estate when both you and your wife are gone.

If you haven't updated your trust since 1988, you are long overdue for an update.  There have been significant changes in the tax laws since then.  

I suggest that you contact a Florida attorney about completely "restating" your trust (keeping the name the same in case there are any assets in the name of the current trust that you've forgotten about ... otherwise, it's an expensive nightmare to get the institutions to hand the assets over to your beneficiaries after you're gone) ... as I tell my clients, a restatement is like a whole house remodel ... you tear down all the walls except one; you keep the street address (in this case, the name of the trust) the same, but you rebuild it in an entirely different way.

A restatement (especially since you've changed states) will probably cost you almost as much as the trust did initially - but the trust you have is as out-of-date as a 1988 Ford with 275,000 miles on it .... it might still run (barely), but you're not going to get very good performance from it ... and the replacement parts are getting harder and harder to find and cost more than if you got a newer car (sorry, I like to use a lot of analogies).

Hope this helps.

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Janet Brewer

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BE CAREFUL about taking legal advice from non-lawyers.

I am a licensed attorney in California. I am available to answer questions about probating estates, preparing wills and trusts, administering estates and trusts, forming family limited partnerships and limited liability companies, and establishing a wide variety of estate and gift tax-sensitive trusts (charitable trusts, children's trusts, irrevocable life insurance trusts, etc.).

I can also answer questions regarding the preparation of estate tax returns (Form 706) in taxable estates. Please note that I do not prepare trust income tax returns and cannot provide you with any information about that type of return.

Please note: I am only able to practice law in the State of California. I cannot answer specific questions about other states' laws; I can only provide some "general" information that may or may not apply to your situation.

Experience

I have practiced California estate, gift-planning, and probate law exclusively since 1991. I am certified as a specialist in estate planning and probate law by the California State Bar Board of Legal Specialization (there are less than 125 such specialists practicing in Santa Clara County and fewer than 7,000 practicing in California - out of over 170,000 lawyers statewide).

I have served as an Instructor in the CFP (certificate in financial planning) program at University of California – Santa Cruz, teaching the estate planning segment.

Organizations
Silicon Valley Bar Association
Wealth Counsel
Wealth Advisors' Forum
Executive Committee Member, Solo and Small Firm Section of the California State Bar (appointed to a 3 year term by the California State Bar Board of Governors)

Education/Credentials
I received my law degree (J.D.) from University of Denver Law School in 1975. I was admitted to the Colorado Bar in 1975 and to the California Bar in 1977 (NOTE: although I am a member of the Colorado Bar, I am on INACTIVE status there). I earned an M.B.A. in 1982, and I earned a Masters Degree in Taxation Law (LLM) at Golden Gate University Law School in 2010 (with honors).

More at:
http://www.calprobate.com

Awards and Honors
2007, 2008, 2009, 2010, 2011, & 2012 - chosen as a "SuperLawyer" - one of the top 5% of Northern California lawyers practicing in the estate planning and probate area (www.superlawyers.com). Avvo Rating of 10.0/10.0

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