Property not subject to probate Flashcards
Tenancy by the Entirety
As a general rule, if a husband and wife take title to property in both of their names, Florida law presumes they own the property as tenants by the entirety unless they state otherwise
If this is the case, the surviving spouse takes all of the property by operation of law. § 689.15
Joint Tenancy with Right of Survivorship
If the decedent and another person owned property as joint tenants with the right of survivorship, the surviving tenant takes the property by operation of law
If the owners are not married to each other, Florida requires that language creating a right of survivorship appear in the document creating the property interest
Special Rules Governing Survivorship Tenancies
If two or more persons own a bank account, unless a document states to the contrary, a right of survivorship is presumed to exist
Pay on death account (POD)
Created when one person opens and funds an account at a financial institution, such as a bank or stock brokerage firm, and designates someone to receive the assets on his death
The beneficiaries have no rights on the account while the depositing owner is still alive
POD accounts allow the depositing owner to make a gift effective on death, without complying with testamentary formalities and without the need for probate
What is the difference between a POD and TOD?
Technically POD refers to bank accounts, and transfer on death (TOD) to securities
When are life insurance proceeds part of a probate estate?
If the insured decedent made her estate or the personal representative of her estate the policy’s beneficiary, the proceeds are part of her probate estate
What is the difference between term and whole life insurance policies?
Whole life policies have a living benefit, and a tax-sheltered cash account that builds up inside. Clients don’t pay taxes on the gain each year, and that money can be used in retirement to supplement retirement planning.
No such benefit is available with term insurance. Term insurance only has the actual life insurance coverage; there is nothing but a death benefit. In order for the benefit to be paid, somebody has to pass.
Under what conditions can a pension or other retirement asset be part of the owner’s probate estate?
- The designated beneficiary does not survive the account owner
- The owner named her estate as the planned beneficiary
- The owner failed to designate a beneficiary
Annuities
Annuities are contracts wherein the purchaser pay the company issuing the annuity in exchange for the right to receive payments at one or more specified times
If the annuity policy is payable only during the annuitant’s life then payments terminate when the owner dies
Are trusts includable in the probate estate?
If a trust is established before the decedent’s death (inter vivos trust) the trust assets generally escape probate
Probate property used to fund a trust created by the decedent’s will (testamentary trust) is included in the probate estate
Property subject to a power of appointment
Instead of directly transferring property to a beneficiary, a property owner may let another person decide who will receive the property
Even if the power holder exercises the power at death, the property is not part of her probate estate
Homestead
Protected homestead as defined by Fla. Stat. § 731.201 is not probate property
Transfers before death
Property that the decedent irrevocably transferred before death is generally excluded from the decedent’s probate estate because the decedent no longer owns the property
Wrongful death proceeds
are excluded from both the probate and federal gross estates
A decedent’s surviving spouse and dependent children may qualify for survivor’s benefits through the social security program. Are these benefits included in the probate estate?
those benefits are excluded from both the probate and gross estates
