Though Florida residents are not subject to as many estate taxes as residents of other states, it is always a good idea to have an estate plan in place. An estate plan can include a last will and testament or a trust fund; it can also include a succession plan for business owners. If you are thinking about creating an estate plan, there are a few things to know that can help you get started.
What is the difference between a trust and a will?
A will makes provisions for which person is going to inherit what items of property or assets when the person who created the will dies. A person who dies without a will (or trust) set up is said to have died “intestate,” and that person’s assets are distributed as set forth by law. After a person passes away, a last will and testament is submitted to a probate court. The probate process can be lengthy and costly, but it can be avoided by creating certain types of trust funds. An estate planning attorney can walk you through the possibilities for trust funds.
Succession planning
If you have a business, it is good to consider what you want to happen to the business after you pass away. For instance, do you want the business to be taken over by a family member or friend? Do you want to sell it? Another consideration is what to do if you become mentally incapacitated. Having a financial or medical power of attorney will allow you to appoint someone to be in charge of making your financial or medical decisions if you are unable to do so.
Insurance for businesses
Estate planning may also involve taking out a life insurance or disability insurance policy to give your loved ones coverage in case something happens to you. A lesser known type of insurance is key person insurance, which would cover some business expenses for the person who takes over your business. An estate planning attorney licensed in Florida can further discuss your options for ways to protect your business and your family.