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Asset Titling is Absolutely Critical to Estate & Personal Planning

November 22nd, 2013

Posted in Estate & Personal Planning

Whenever discussing a client’s plan for addressing lifetime or death transfers (including an involuntary transfer or loss to a creditor), asset titling is critical and often the most overlooked aspect of developing a strategy.  The manner in which an asset is titled determines how it can be disposed of.  Recently, I encountered a married couple who thought their Wills and Trusts provided for their intent that each spouse receive the other’s property for life in trust after the first spouse’s death and then ultimately to their children from a prior marriage.  Come to find out, almost every asset was titled jointly or had a spousal beneficiary designation on it.  Thus, the asset would pass not pursuant to their Wills or Trusts on the first spouse’s demise but by per operation of law.  This is just one example of why asset titling is so important.

Asset titling is also critical for creditor protection.  For example, how an asset is held or acquired can establish whether it qualifies as Tenancy by Entirety property and thus protected from non-joint or single creditors for married couples with assets in Florida.  Titling can affect divorce implications or property rights during lifetime.  It can determine whether an inherently dangerous asset such as a vehicle or boat creates possible liability for the owners.  It is recommended that asset titling be reviewed on a periodic basis, including whether the asset carries a beneficiary designation, so the terms and intent of your estate or personal plan may be realized.  Finally, it is advisable to engage a qualified attorney as things are not always as simple as making sure a form will or trust off the internet is executed.  There are Florida statutes and constitutional laws that may trump such documents.

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