As we begin 2011, there is much uncertainty in the areas of both estate planning and asset protection. As the estate laws change, we will, as we have done here continue to update you so that you may better serve your clients and protect yourself and your South Florida family.
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Estate planning and asset protection changes for 2011
1. Estate Planning and Asset Protection Changes for 2011
By Michael D. Wild
As we begin 2011, there is much uncertainty in the areas of both estate
planning and asset protection. For much of 2010, we expected 2011 to
greet us with a 55 percent estate tax on all assets over $1 million.
Toward the end of 2010, President Obama gave in to Republican
demands of a reprieve on this exorbitantly high death tax and agreed to
reduce the estate tax for 2011 and 2012 to 35 percent, with a $5 million
exemption amount. If you plan on dying in the next two years, you may
be relieved.
However, if you plan on living well past 2012, uncertainty still remains.
As of today, the estate tax rate for 2013 will revert to 55 percent, with
only a $1 million exemption amount. We will hope for the best but must
plan for the worst, which is why we recommend that our clients set up
Irrevocable Life Insurance Trusts for all life insurance policies over
$250,000 and Bypass trusts for all marital estates over $2 million.
Visit the Fort Lauderdale Estate Planning Law Firm of
Wild Felice and Pardo for a Free Consultation
As the estate laws change, we will continue to update you so that you
may better serve your clients and protect yourself and your family.
The world of asset protection was turned slightly on its head as well in
2010. On June 24, 2010, the Florida Supreme Court issued its long-
awaited opinion in the case of Shaun Olmstead, et al., v. The Federal
Trade Commission and raised the question as to whether Florida limited
liability companies (LLCs) will continue to have charging order
protection.
A charging order is a remedy that a creditor of a member in an LLC can
receive from a court that instructs the entity to give the creditor any
distributions that would otherwise be paid to the partner or member from
2. the entity. Generally, a creditor who receives a charging order with
respect to a member’s interest in the entity does not have any authority
to mandate distributions from the entity or to participate in the
management and affairs of the entity, nor are they able to access the
assets of the company.
Visit the Fort Lauderdale Estate Planning Law Firm of
Wild Felice and Pardo for a Free Consultation
Charging orders are governed by state law, and in many states, a
charging order is the exclusive remedy for a creditor with respect to a
debtor’s LLC membership. However, the Olmstead ruling allowed the
creditor to “pierce the corporate veil” of the LLC and access the actual
assets of the LLC.
While the LLC at issue in Olmstead was a single-member LLC, many
attorneys are concerned about the slippery slope that would allow the
piercing of multiple-member LLC’s as well. It is definitely something
that we will keep an eye on in the coming months.
For more information on successful Florida estate planning and asset
protection techniques, please contact the South Florida law firm of Wild
Felice & Pardo, P.A. at 954-944-2855 or via email at info@wfplaw.com
to schedule your free consultation. Let us protect what and who you
value most.