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Estate Planning Tips for Florida ‘Snowbirds’

A “snowbird” is a person who lives part of the year in a warm climate (like Florida) and part of the year in a cooler climate, typically in the north. Snowbirds tend to be retired people with property in two states. Often, they originally hail from the north, but spend part of the year in Florida to avoid harsh winters.

But if you spend half the year in one location and half in another, how does that affect your estate planning? There are a few things you should keep in mind if this applies to you. 

Know the estate tax laws of each state

There are 15 states that levy their own estate taxes upon death, and six more states that have an inheritance tax. This is in addition to the federal estate tax, which for 2017 applies to any individual estate worth $5.49 million or more (or $11 million or more for couples).

Florida is one of the states that does not have an additional estate or inheritance tax. Looking to the northeast, however, New Hampshire is the only state in New England without its own estate tax. This is one of the reasons many wealthy residents of the northeast choose to either snowbird in or move permanently to Florida.

For the purposes of estate taxes, where you pass away is not as important as where you spend more of your time before your passing. You may own property and pay real estate taxes in two states, but you will be considered a legal resident of the one in which you spend the most time. In many instances, the state where you vote is your state of legal residence.

Establishing a trust for real estate

If you have property in multiple states, your beneficiaries may need to go through the probate process in more than one state. To that end, setting up a trust and having it be the legal owner of the real estate can make transferring the property to your beneficiaries quite simple.

Durable power of attorney

Snowbirds should execute a durable power of attorney for each state in which they reside so their chosen agent can make legal or financial decisions on their behalf, if necessary. This is critical for anyone who owns property and/or bank accounts in multiple states.

For the estate planning advice you need, speak with a knowledgeable Florida attorney at The Charles Law Offices.

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