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Defining Common Florida Estate Planning Terms

Although I always try to explain legal concepts in plain language, I am aware that many of my posts include Florida estate planning terms that may not be easily understandable…  

I am therefore dedicating this article to clearing up some basic legal jargon by shedding some light on the most common Florida estate planning terms, in the hope of making future articles clearer and more informative.  Although I’ll try to avoid it, you can always refer back to this article if some legal mumbo jumbo arises in the future.

For example, the term “Personal Representative” is often used in Florida estate planning, and yet many do not know that this term is interchangeable with more understandable…”Executor”. Both terms refer to who is in charge of taking care of the estate.  Whether the former term is used or the latter will depend upon the local laws and legal customs in your home state.

The Importance of Defining Important Estate Planning Terms for your Planning

Without An Understanding The Meaning Of Key Estate Planning Terms, It Can Be Very Difficult To Clearly Understand Your Florida Estate Planning.

Understanding your estate planning in Florida without comprehending the defined terms is a bit like trying to design and build your own home without an understanding of basic construction knowledge.  However, when you begin to understand the various terms, you gain a better understanding of the various documents, the specific purpose of those documents, and how they work together.

The Following Key Terms Are Essential For A Basic Understanding of Florida Estate Planning.

Testator

The Testator is the person whose estate is the subject of concern.  So, if a Florida last will and testament is in question, the Testator would be the one who created it and whose assets are concerned.

Testate/Intestate

Whereas the testator is the one who created the Florida last will and testament, “testate” then refers to someone who died with a will in place, and Intestate refers to someone who passed without a will.

Executor/Personal Representative

As discussed above, the executor and personal representative both refer to the individual designated in the will who is charged with overseeing the payment of debts and distribution of all assets.  He or she is responsible to assure that the required probate process is completed, debts are paid, and the assets are distributed to the heirs or other beneficiaries.  Whether the executor or personal representative in Florida is used will depend upon the local laws.

Last Will & Testament

Most people believe they understand this one.  Yes, the last will and testament in Florida is the document that contains the last wishes of the testator.  It is important to understand that this document must be signed with certain formalities in accordance with State laws. For more information about 3 critical Florida estate planning documents that you need visit our previous post.

Revocable Living Trust

A revocable living trust in Florida is essentially another way to pass an estate in addition to the Last Will.  As discussed in many previous posts, a Florida revocable living trust passes Florida estate assets (by contract) in a private process, and ideally should avoid the need for probate.

Settlor

Similar to the Testator’s role in establishing the Florida last will, the Settlor is the individual who established the Florida revocable living trust (or couple in the case of a joint revocable living trust in Florida) .

Trustee

Similar to the Executor’s role in taking care of the estate assets and enforcing the Florida Last Will, a Florida Trustee is appointed by the Settlor and is responsible to take care of the Florida revocable living trust assets for the beneficiaries.  Usually, the Settlor will choose to serve as the initial Trustee when doing Florida estate planning.

Heir/Issue

Heirs and Issue typically refer to blood relatives who will inherit the estate either by designation in the Florida will (or Florida revocable living trust) or, if there are no estate documents, then who will inherit in accordance with the Florida state laws of intestacy. These are two terms that are used somewhat interchangeably.

Beneficiary

As distinguished with heirs or issue, a beneficiary refers to someone who is named to inherit from an estate or to receive proceeds from an insurance policy or financial account.  A beneficiary may be a spouse or any other 3rd party.

Per Stirpes/Per Capita

These are latin terms that refer (in a Florida last will or revocable living trust) to the division of estate assets between the “heirs” or “issue”.  If per stirpes applies, as in Florida estate planning and probate, an equal division between each “level” or “class” of Heirs (i.e. children and grandchildren), and this means that if 2 of 3 children survive, and the deceased child is survived by 2 grandchildren, then the surviving children would receive a third and the surviving 2 grandchildren would receive the deceased child’s third.   If per capita applies, as in other states, the 2 children would evenly split the estate with no share reserved for the deceased child’s children.

Fiduciary

This a general term that refers to the various appointed roles that carry a duty of care and loyalty. Examples of roles that carry a fiduciary duty are foremost the trustee and generally other roles such as a power of attorney or guardianship would carry a fiduciary duty.

Durable Power of Attorney

This role is a key component in most estate plans and refers to the individual who is designated under a Florida durable power of attorney to handle all business transactions for the one appointing the power .  Unlike other kinds of powers of attorney, a durable power allows the designation to remain in effect when the appointing person becomes disabled, whereas other powers of attorney would be rendered void by the disability.

Healthcare Surrogate

This role a Florida designation of healthcare surrogate appoints the individual who is designated to make medical decisions for the appointing person in the event that he/she is incapacitated an cannot do so.  An interchangeable term here is a Florida healthcare power of attorney whoever the use of “healthcare surrogate” is most common in Florida.

Guardian/Conservator

This role applies either to estate planning for aging adults or to estate plans involving minor children.  A Florida guardian is designated to have legal custody of a person until age of majority or to take over in the event he or she cannot manage the decisions that are essential for daily living.  Other states may use the designation of conservator for the same basic role.

My hope is that a basic understanding of the above terms will serve as a good start for you in understanding your estate plan and that of your loved ones, as well as provide a foundation for future learning.  Admittedly, the above overview is basic in nature and each category my lend itself to additional categories of terms and distinctions.

Steven J. Gibbs, Esq.

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