Call (954) 966-2112 and Schedule a Consultation
Call (954) 966-2112 and Schedule a Consultation
Estate Planning revolves around the family. Is this a second marriage? Does one child have problems- creditor issues, health concerns, a difficult marriage, lack of motivation, etc.? Is one child in a high risk business- such as being a doctor- who has a high probability being involved in a malpractice suit.
Estate planning involves a lot more than just transferring wealth at death.
What happens if the parent is no longer able to handle his financial affairs and has difficulty in making medical decisions? Enter Advanced Directives. We often prepare Durable Powers of Attorney, Health Care Surrogates, Living Will, and Preneed Guardian documents.
What many people don’t realize is that a Will only affects property that is owned by the decedent that does not have a beneficiary attached to it.
Most married couples have much of their wealth owned jointly with right of survivorship such as their home and financial accounts. These assets avoid probate of the first to die and go the survivor. Some assets, notably life insurance and retirement plans, have beneficiary designations associated with it. When so designated, these assets (with certain exceptions) go to the beneficiary when the owner dies.
Estate planning also involves asset protection. Florida law provides a generous list of assets that can’t be seized by your general creditors. Although the list is similar to many other States, the unusual aspect of Florida law is that in most cases there are no limits on value.
Florida law exempts pension, profit sharing plans, 401(k) Plans, IRAs, etc. without limit.
Florida law also exempts wages paid to a head of household, cash value life insurance, and annuity contacts without limit.
Florida law also exempts the homestead from creditor attack except for mortgages, taxes, and goods and services related to the homestead. While there is no dollar limit, the exemption applies for up to ½ acre within the city limits and up to 160 acres (1/4 of a square mile) in an unincorporated area.
Often we use Revocable Trusts in estate planning. Assets in a Revocable Trust avoid probate. When the grantor dies, the funds can be paid out in a lump sum or held in trust. Often a portion of each. Much like a Will, they can usually be changed during the lifetime of the grantor,.
In the case of a child who requires higher protections, we sometimes use a “protective trust.” This means that there are discretionary distributions of income and principal based upon the beneficiary needs for health education, maintenance, and support. There are no mandatory distributions when the beneficiary reaches certain ages.
One technique that we increasingly see is the use of “Lady Bird” deeds. Here the owner of the real estate executes a deed, but retains the property in her name, for the rest of her life. This is known as a “life estate.” When the grantor of the deed dies, it goes to the “remainderman” disclosed on the deed, at the moment of the death of the life tenant. Importantly, the remainderman interest is revocable should the life tenant want to do so. Usually, this happens if the life tenant would like to sell the property or refinance.
One aspect of estate planning that is often ignored is how the assets are owned and/or if there is a beneficiary designation. By properly changing the ownership or beneficiary designation, probate can often be avoided.
Estate planning involves taxes. For most people, the Federal Estate Tax does not apply, because there is an exemption of $15 million. For this purpose, assets subject to probate, all or a portion of jointly-held assets, assets that go by beneficiary designation, and assets in a Revocable Trust are included. If the decedent owned life insurance on his life, the value of the death benefit is included.
There is even a fifth category of assets that is included for Federal Estate Tax purposes. This includes some property that the decedent gave away during his life with “strings attached.” If the decedent retained the right to control the transfer, the right to revoke it, retained the income, etc., this could be included as well. One could view this as “constructive ownership” of property.
While the exemption is $15 million in 2026, and increases each year for inflation, there is nothing that prevents a future Congress from reducing it. Because of the growing inequality and public debt in the United States, this is not an idle thought.
Accordingly, we often meet with our well-off clients to suggest Federal Estate Tax programs to reduce or eliminate the Tax.
Among the techniques we use are:
Finally, many, but not all, assets includible for Federal Estate Tax receive a new Income Tax basis equal to fair market value at date of death (or in certain cases, 6 months after death.)
Basis is the starting point in determining Income Tax on Gain or Loss upon sale. During lifetime, it is often cost. Stock purchased for $1,000, has a basis of $1,000. If sold years later for $3,000, there is a $2,000 Gain. If the value of the stock were held until death, and the value was then $3,000, this becomes the new basis. I f the stock were then sold for $3,000, there would be no Gain or Loss.
While Florida has no estate tax, your estate is still subject to federal estate taxes. These taxes only impact high net worth and large estates. Under the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, the federal estate tax exemption was permanently increased to $15,000,000 per individual as of January 1, 2026. Estates valued above that amount could pay up to 40% in federal estate taxes, depending on the value of the taxable estate. For a married couple, the combined estate tax exemption is $30,000,000.
For instance, if you are single and your estate is worth $25,000,000, then $15,000,000 is exempt from the federal estate tax. That leaves $10,000,000 of your estate subject to the estate tax. Since the taxable estate exceeds $1,000,000, the estate is in the highest tax bracket, meaning a 40% tax rate applies. As a result, the total federal estate tax owed would be approximately $4,000,000. Proper estate planning can help reduce or eliminate this significant tax burden.
Importantly, the OBBBA has made the $15,000,000 exemption permanent and indexed it for inflation beginning in 2027. Unlike prior legislation, the Act contains no sunset provisions, so there is no longer a risk of the exemption reverting to a lower amount. However, Congress retains the authority to amend or repeal tax laws in the future, so proactive estate planning remains essential.
Even with the increased exemption, individuals and families with estates exceeding $15,000,000 – including professionals, business owners, and real estate investors – may still face significant federal estate tax liability at the 40% rate. Early and comprehensive planning is critical to minimizing that exposure.
Due to the potential for high tax liability, individuals with a high net worth or large estate may wish to take advantage of available estate-planning techniques. Creating certain kinds of trusts and annual gift-giving, among other options, can help individuals avoid or minimize the payment of estate taxes.
Various methods exist to avoid probate proceedings, which, in turn, can guarantee more privacy for you and your family following your death. These estate planning techniques also can help safeguard your assets from the reach of creditors. In some cases, trusts can also help you minimize taxes and support loved ones with special needs. By taking advantage of these mechanisms, you can make it easier for your family to handle your affairs, protect your remaining assets, and fulfill your last wishes.
Trusts allow you to structure the payment of assets to beneficiaries in a certain way, as outlined in the terms of your trust. You can also choose someone you believe to be reliable, honest, and trustworthy to act as a trustee and administer the trust on your behalf as written. Utilizing a trust may allow you to ensure that your chosen beneficiaries use your assets as intended. When you have a significant amount of assets, determining how to allocate them is no small task. A trust allows maximum flexibility in fashioning the estate plan that best meets your objectives.
A trust puts you in control of how your assets are used – even after you are gone. You set the terms. You choose your beneficiaries. You select a trustee you trust to carry out your wishes faithfully. This structure ensures that your assets go exactly where you intend, and are used exactly as you direct. Trusts can also help shield your estate from creditors, provide for loved ones with special needs, and minimize tax exposure. For anyone with significant assets, a well-crafted trust is one of the most flexible and powerful tools in your estate plan.
Taking advantage of the annual gift tax exclusion is another common way to reduce your taxable estate. Annual gifting can be helpful when you have a high net worth or large estate. For 2026, the gift tax exclusion is $19,000 per recipient; this amount is indexed annually for inflation. Furthermore, this exclusion applies to each spouse. As a result, a married couple can gift $38,000 each year to the same person without using any of their lifetime exemption or filing a gift tax return.
No one plans to become incapacitated – but illness or injury can happen to anyone. Without the right legal documents in place, someone you did not choose could end up controlling your finances. That is a risk no one should take. A durable power of attorney and other key planning documents allow you to designate exactly who manages your affairs if you are ever unable to do so yourself. Taking this step now is one of the most important things you can do to protect yourself – and give your loved ones the clarity they need during an already difficult time.
As the owner of a large estate, you must have an estate plan to protect the wealth you have accumulated over the years. A Hollywood estate planning lawyer at Kramer Green PA has the knowledge and experience you need to create and refine a comprehensive estate plan tailored to meet your needs, minimize estate taxes, and safeguard your wealth. Together, we can ensure you meet your objectives through estate planning.
Contact an estate planning attorney today by calling (954) 966-2112 or finding us online. Let us help you prepare for the future by developing and maintaining the right estate plan.
