What is a Pour-Over Will in Florida?
What is a Pour-Over Will in Florida?
It seems like everyone talks about trusts or traditional wills but skips over pour-over wills.
A pour-over will can be extremely valuable when done right, especially if you put your assets into a revocable trust.
What is a pour-over will, and how can you benefit from it? Our attorney is here to answer just that.
What is a Pour-Over Will?
A pour-over will works in conjunction with a revocable trust. It is meant to transfer the assets to the trust after you die.
You can think of the trust as the sole beneficiary of the pour-over will. Upon death, a pour-over will essentially "pour over" any assets you haven't yet placed into your living trust. This way, you can still dictate where they go and who they go to rather than leaving it up to the courts.
Once assets are "poured" into the trust from your pour-over will, they will be distributed based on the terms you outlined.
What is a Revocable Trust?
To fully understand how a pour-over will works, it's essential to know what a revocable trust is because they go hand in hand.
A revocable trust is similar to a last will and testament in that it distributes assets to beneficiaries upon death. However, it has two significant benefits: revocable trusts avoid probate and keep asset distribution private.
You can remove assets from a revocable trust, add them, or dissolve the trust at any point during your life.
Revocable trusts are especially beneficial for beneficiaries who are young or not great with money management because they can act as an allowance. You can structure a revocable trust to pay out a certain amount over set intervals or when someone reaches a specific age.
What is the Purpose of a Pour-Over Will?
Simply put, a pour-over will helps you take full advantage of the trust you've set up.
As time passes and you gain more assets, you may not have had the chance to put all of your assets into your revocable trust before you die — this is where a pour-over will comes into the picture.
A pour-over will acts as insurance for your trust by ensuring all of your estate assets will become part of your trust.
Pour-over wills also allow you to name a guardian to take care of any minor children you may have at the time of your death.
How Does a Pour-Over Work in Florida?
The components of a pour-over will are essentially the same as a traditional last will and testament.
You have a testator (the person who creates the will), an executor (a person or entity who handles the distribution of assets in the will), and a beneficiary. However, the beneficiary of a pour-over will is the trust tied to it.
When you die with a pour-over will, the assets will become the trust's property. Because of this, you must clearly outline which assets you want to go to the trust.
What are the Benefits of a Pour-Over Will?
A pour-over will has many benefits for you and your loved ones. If you've put your assets into a revocable trust, we highly recommend putting together a pour-over will to cover anything else that might come up.
Maintain Ownership of Some of Your Assets
Technically, a trust owns all of the assets it contains. Leaving certain assets out of it allows you to maintain ownership of them. If you put the remaining items in a pour-over will, you can also have peace of mind knowing they will eventually be part of your trust.
Set Instructions for Asset Distribution
A pour-over will lets you control how your assets get distributed based on the terms you outlined in the trust. For example, you can structure it to allow $10,000 to go to your child per year for ten years.
While your pour-over will has to go through probate, there is still a degree of privacy.
The contents of a pour-over will are public during the probate process but become private after they enter the trust. This means the asset's beneficiaries, values, and descriptions will remain private after being transferred into the trust.
With traditional wills, the distributed assets become public, along with who received them.
Control Over Who Gets Your Assets
Without a trust or will to tell the court who you want to receive your assets, they may not go to the people you wanted.
A pour-over will ensures that any assets you might not have already placed in a trust still go to your desired beneficiaries.
Establish Guardianship Over Minor Children
If you have minor children without designated beneficiaries, a pour-over will establish who will take guardianship of them instead of leaving this decision up to the courts.
Saves Loved One's Money
Since the assets in a pour-over will go to a trust, beneficiaries often pay fewer taxes than if they got them from a traditional will.
What are the Disadvantages of a Pour-Over Will?
The main disadvantage of a pour-over will is that the assets still have to go through probate.
This means assets can't be distributed until probate is complete. As a result, assets can be tied up in the trust for a few months to over a year.
The best way to avoid a lengthy probate process is to consult an experienced estate planning attorney when making your estate plan. They will ensure you don’t miss anything and that all documents are valid.
Florida Pour-Over Will Attorney
If you need help creating a pour-over will in Florida, contact our office for advice from our experienced estate planning attorney. Send us a message or call us to get started today!