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Focus on Florida

By Donna Blaustein UM Carey School of Law '71

For individuals interested in retiring or moving to a new state, Florida could be a perfect choice—and not only for the wonderful weather. Here are a few things to think about as you consider heading south.

TAX ISSUES. The Florida State Constitution prohibits the taxation of individual income, although there are significant real estate and sales taxes. Also, Florida has no state gift, estate or generation skipping tax.

HOMESTEAD PROTECTION. Residential real property owned and occupied as a principal residence upon which homestead exemption is declared, is completely exempt from the claims of non-mortgage creditors during lifetime. It is also exempt at death if the homestead passes on to one or more family members. No other creditors may levy upon the homestead real property. Homestead law issues are complicated and protection may easily be lost if the real property is not properly transferred or titled. It is essential that no estate planning document direct the sale of the homestead at death, since this directive will cause the loss of the creditor protection.

CREDITOR PROTECTION. Florida is a friendly place for individuals seeking creditor protection. In addition to the very liberal homestead laws, IRAs, annuities, retirement accounts and insurance assets are protected from creditors' claims.

POWER OF ATTORNEY. Florida's recently revised Durable Power of Attorney Act allows sweeping powers to be given to the attorney-in-fact. Under the provisions of the statute, an attorney-in-fact may be given the power to change an individual's trust, disclaim assets and change beneficiary designations on bank accounts, to name only a few. "Springing powers of attorney," which are designed to become effective only upon incapacity, have been eliminated, thus requiring extreme care in creating a power of attorney.

HEALTH CARE DIRECTIVES. Florida is very generous in recognizing advance health care directives and living wills. Without written directives, significant problems can occur during illness.

OWNERSHIP OF REAL PROPERTY IN MORE THAN ONE STATE. Many individuals maintain real proper ty in their former state of residence and purchase new real property in Florida. Consideration should be given to re-titling the out-of-state property and transferring it into an LLC, Family Limited Partnership, Revocable or Irrevocable Trust or other entity to avoid probate and possible death taxes in the state where the property is located.

HURRICANE ISSUES. Florida is a hurricane prone state. Individuals moving to Florida and purchasing a new home may have difficulty obtaining hurricane and flood insurance and may be unable to close on the purchase if their closing is scheduled within a hurricane watch window. Therefore, individuals relocating to Florida might want to schedule their real estate closing during winter months and should carefully check the cost and availability of hurricane and flood insurance prior to purchase.

LGBT ISSUES. Florida does not recognize same sex marriage nor does it grant benefits to same sex couples. Therefore, it is essential that same sex couples planning to move to Florida consult an attorney to be certain that their relationship and their assets are adequately protected. Proper health care directives, guardianship designations and estate planning documents should be prepared to protect both partners. Titling of real estate and other assets should be given careful consideration.

Donna Blaustein, Esq. is a 1971 graduate of UM Carey School of Law and has maintained a law practice in the greater Miami area since 1975. Her practice focuses on all aspects of estate planning. In addition to many other volunteer commitments, Donna serves as the chair of the Planned Giving and Endowment Committee for the Jewish Federations of North America.

The above material, and all material on this website, is provided to you as an educational service. These materials are not intended as specific legal or financial advice. Please consult with your personal legal and financial advisors to determine how federal, state and local laws apply to your specific situation.