Revocable living trusts have become a popular vehicle through which to funnel assets in connection with estate planning.  There are a number of benefits to using trusts including the avoidance of probate and the elimination of multi-jurisdictional estate administrations.   Stated another way, they can be cost effective when used properly.

However, with every positive, there is a negative to consider.  Contrary to popular belief, revocable living trusts do not provide asset protection; and they cannot be used to circumvent Florida constitutional restrictions on the alienation and devise of Florida homestead property.  This is often a trap for out-of-state attorneys and estate planners who try to extend their estate planning beyond their territorial expertise.

Additionally, trusts are more expensive to create and sometimes more costly to administer than simple wills.  We often see trusts being prescribed when they are not needed.   Some attorneys have forgotten their fiduciary duty to put their clients first.   Instead, they prescribe trusts when not needed because the attorney gets to charge the client more even though a simple estate plan could work just fine.

However, when a trust is warranted, it is important to use it properly.  Having a trust and not using it properly is like joining a gym but not going to the gym.  You are not going to get in shape without going to the gym.  You are not going to get the benefits of a trust unless you use it properly.

Over the years, a substantial part of our practice has involved the proper use of trusts, especially in connection with holding title of real estate and real estate transactions.  Our office handles title transfers into trusts so the mechanisms set up on the trust estate plan have a chance of being effective.  Our office also can amend your out-of-state trust so you get the benefits of homestead tax exemption.  Additionally, in connection with our estate planning practice, we can integrate your existing trust into a revised or updated Florida estate plan.

We encourage our out-of-state clients to consult with us to review their out-of-state trusts and estate plan to make sure their wishes are properly addressed under Florida law.   When we advise our clients that their estate planning intention under their out-of-state will or trust will not be given effect because it does not comply with Florida law, they are often amazed.  However, amendments can be made and the estate plan can often be adjusted to achieve our client’s wishes.

Unfortunately, for those that do not consult with us prior to their death, their out-of-state estate may fail.  We are, nevertheless, adept at making sure the title descends in compliance with the Florida constitution, notwithstanding the provisions of the trust.   Our Probate Department routinely works with our Title Insurance and Closing Department to solve the issues created by the assumption of the out-of-state attorney that the law of their state would be applied to Florida real estate.   The fact is that only Florida has jurisdiction over Florida real estate, and only Florida law and the Florida constitution are the only laws that count when Florida real estate is involved.

In summary, it is important to involve a Florida attorney, experienced in both estate planning and real estate law when you own Florida real estate, especially when you are doing estate planning involving trusts or settling an estate when real estate is involved.