Should Snowbirds Change Their Estate Planning Documents When Moving to Florida?
Sunday, February 24, 2013 at 05:06PM
Each year, tens of thousands of people, lured by the abundance of sunshine, the active lifestyle and the lack of taxes, relocate to Florida and become residents. Many bring their Wills, Trusts and other estate planning documents with them from their former state. As an estate planning attorney, one of the biggest questions I hear is: “Do I have to change my Will and estate planning documents now that I’m a Florida resident?”
To answer that question, let’s take a look at the areas that are most likely to cause issues. Florida law says that courts in Florida will recognize a Will as valid if it is valid in the state where it was drawn up at the time it was drawn up. Keeping that in mind, the first issue is then:
1. Is your Will valid in your previous state? In most cases the Will is presumed valid. However, this issue may open up a challenge in a Will contest case. In such a situation, your heirs may have to prove the Will’s validity using an expert legal witness from your previous state. This can be a huge expense to your estate.
2. Is your Will self-proved? Even if the Will is deemed to be valid, Florida law requires it to be “proved” in order to be admitted to probate. This means that a person who has signed the Will as a witness must also sign an oath certifying that you executed the Will with the proper legal formalities and that your were competent at the time.
Florida also provides that a Will may be self-proved. This happens when the testator (testatrix, if female) and the witnesses acknowledge the Will and execute a self-proving affidavit in the presence of a notary. Any Will that is self-proved may be admitted to probate without testimony of the attending witnesses. Many states do not customarily self-prove wills. In these cases the witnesses must be found and they must sign an oath before a judge, clerk or deputy clerk, or court-appointed commissioner, that the Will being offered for probate is the same Will he witnessed the decedent sign. Imagine trying to track down the person who witnessed your Will 40 years ago in Illinois.
Also, even if the witness can be found, he can’t sign the oath in front of any notary. He either must sign in the presence of a deputy clerk of a Florida court or a notary commissioned by the Florida probate judge to acknowledge the oath. This procedure adds time and expense to the probate proceeding and should be avoided when possible by drawing up a new Florida Will.
3. The person named to serve as your personal representative does not qualify. Florida law requires the personal representative of your estate to either be a) a Florida resident, or b) related to you. Many people name friends form their old state in their Will to be the personal representative (or executor). If these friends are not Florida residents at the time of the administration of your estate, they will not qualify and the court may appoint someone you do not want.
4. Homestead. Florida has very strict and unusual laws regarding the distribution of homestead after a person’s death. If you are married, you can only leave the homestead to your spouse. If you try to do otherwise, the law overrules your wishes and creates a life estate in the surviving spouse and, after he or she dies, leaves your share of the homestead to your lineal descendants – whether that is what you wanted or not.
This can wreak havoc on the estate plans of couples in second marriages who only want to leave their estate to their children. This can also cause problems with couples who have set up A-B Trusts to minimize or avoid estate taxes. The formula for distribution of such a trust may cause the homestead to be distributed to the B Trust, which would violate the homestead law and result in the situation described above.
5. Does your Durable Power of Attorney comply with Florida’s new law? Florida recently revamped its durable power of attorney law. Many powers given to the attorney-in-fact (or agent) must be specifically authorized by the principal, or they may not be honored. This has the potential of leading to unwanted guardianship proceedings if you become incapacitated.
6. Does your old state recognize you as a resident of Florida? If you look at your current Will, it will likely say (usually in the first paragraph) that you are a resident of your prior state. Some states take that declaration very seriously. They reason that a Florida resident wouldn’t have a Will that states he is a resident of Pennsylvania.
This was the ruling in a 1992 case in the Pennsylvania Commonwealth Court. The court ruled that a person who died in Florida was a Pennsylvania resident and subject to Pennsylvania tax, despite the fact that he received a Florida homestead exemption, had a Florida vehicle registration and driver’s license, had bank accounts in Florida, filed his federal income taxes with a Florida address and spent eight months of each year in Florida. The court stated that its decision was based largely on the declaration in his Will that he was a Pennsylvania resident.
As you can see, failing to have your estate plan comply with Florida law can have some serious consequences. If you have made the decision to become a Florida resident, having a Florida attorney review your estate planning documents is as important as changing your drivers license and applying for homestead.