Posted in Asset Protection,Business & Corporate Law,Probate & Trust Administration,Real Estate Law,Tax Law & IRS Defense,Wills, Trusts & Estate Planning

The attorney-client privilege is one of the most important legal protections that an individual or entity has when seeking legal advice from a Florida attorney.  Section 90.502(c) of the Florida Statutes states that communication between an attorney and a client is confidential if it is not intended to be disclosed to a third-party other than when the communication to a third-party is made in the furtherance of legal service to the client or when the use of a third-party is reasonably necessary for communication between the attorney and client.  It is important to note that there are exceptions that may apply, such as when the attorney’s services are sought to enable what the client knows to be a crime or fraud.  The purpose of the statute is to protect almost all information disclosed by the client.  However, this protection can be waived and subject to disclosure if third-parties are involved in the communication.  Moreover, Section 90.507 of the Florida Statutes provides that the attorney-client privilege is waived when a confidential matter is voluntarily discussed in a manner where a reasonable expectation of privacy does not exist.  Examples may include copying a third party to an email to your attorney, forwarding an email from your attorney, including a friend in a meeting with your lawyer, or encountering your lawyer at a public venue with other people listening to the conversation and discussing your case.
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Posted in Asset Protection,Probate & Trust Administration,Wills, Trusts & Estate 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.
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Posted in Asset Protection,Business & Corporate Law

Many clients have questions about improving their credit post-bankruptcy.  A successful bankruptcy eliminates or discharges a debtor’s legal obligation to repay a debt.  However, it does not place an affirmative duty on a debtor’s creditors to remove any pre-bankruptcy non-payment history on credit reports.  In other words, a bankruptcy may clean up legal obligations, but it does not affect credit reports unless the creditor voluntarily corrects its reporting.  Experian, Transunion, and Equifax are the national credit reporting agencies.
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Posted in Asset Protection,Business & Corporate Law

Under Florida Statute §627.4137, you may request a person or entity reveal certain liability insurance information to you. Section 627.4137 of the Florida Statutes states, “Each insurer which does or may provide liability insurance coverage to pay all or a portion of any claim which might be made shall provide, within 30 days of the written request of the claimant, a statement, under oath, of a corporate officer or the insurer’s claims manager or superintendent setting forth the following information with regard to each known policy of insurance, including excess or umbrella insurance:
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Posted in Asset Protection,Probate & Trust Administration,Real Estate Law,Wills, Trusts & Estate Planning

A land trust is “an express written agreement or arrangement by which use, confidence, or trust is declared of any land […] under which the title to real property […] is vested in a trustee.”  Fla. Stat. § 689.071.   It is an average tool at keeping property ownership partially concealed from prying eyes, but it does not generally offer great asset protection from creditors.  Most land trusts are self-settled trusts.  Self-settled trusts are trusts that are formed by the property “owner” for the benefit of the same.  Self-settled trusts typically offer little to no asset protection for the property “owner”/beneficiary.  When a creditor properly seeks, through the discovery process promulgated by the Florida Rules of Civil Procedure, disclosure of property that the beneficiary has an interest in, the beneficiary will usually have to disclose the land trust property.  Once disclosed, the property of the self-settled land trust may be subject to the creditor just the same as if the property were held individually by the owner.  Many attorneys maintain that land trusts offer little to no asset protection and are simply a facade giving the illusion of protection while providing the benefit of limited privacy.

Posted in Tax Law & IRS Defense

Your local Florida property appraiser mails out the Notice of Proposed Property Taxes (Truth in Millage or “TRIM” form) in August of each year.  Property owners or taxpayers who wish to contest or appeal their property value to the Value Adjustment Board must file a petition (one of the DR-486 forms) with the clerk of court within 25 days of the Notice of Proposed Property Taxes.  For St. Johns County as an example, the petition for adjustment must be filed no later than September 13, 2013.

Typically as with most legal matters, it’s best to try and resolve the matter prior to filing a petition.  If time permits, it’s advisable to contact your local property appraiser’s office to resolve issues such as market value, classification, or an exemption.  Keep in mind that there are many other issues concerning property taxes in Florida that can be applicable, such as portability, the Save Our Homes cap (currently 1.7% for 2013 per the CPI index, which is lower than the 3%), joint ownership or adding someone to your deed, inheriting family-owned property, or the transference of property.  More information can be found at the below two Florida Department of Revenue websites.  As always, promptly and timely consult with a qualified tax attorney should the need arise.

http://dor.myflorida.com/dor/property/taxpayers/howdoi.html

http://dor.myflorida.com/dor/property/taxpayers/

Posted in Asset Protection,Tax Law & IRS Defense

The Home Affordable Modification Program is an important tool for homeowners who are experiencing financial difficulties in making their mortgage payments yet desire to keep their homes.  Most would probably agree that the ideal home loan modification would include a lower monthly payment, lower interest rate, and probably most importantly, a principal reduction.  However, that principal reduction could affect the homeowner when he or she later decides to sell the property.  Although a principal reduction loan modification will not typically result in cancellation of debt income, it will likely reduce the homeowner’s basis in the subject property.  The basis reduction will equal the amount of the principal reduction.  The end result could increase the homeowner’s tax liability when the property is later sold.  See IRS Publication 4681 (2012).

Posted in Asset Protection,Tax Law & IRS Defense

Interest follows the tax liability.  See  In re Burns, 887 F.2d 1541 (11^th Cir. 1989).  If the tax debt is non-dischargeable, then the interest accruing on the tax debt will be non-dischargeable.  “[A] tax penalty is discharged if the tax to which it relates is discharged […] or if the transaction or event giving rise to the penalty occurred more than three years prior to the filing of the bankruptcy petition.”  In re Burns, at 1544.  If the tax liability is non-dischargeable, but the penalty portion of the liability is, then the interest which follows the tax is non-dischargeable but the interest which follows the penalty is likely dischargeable.