Nov 2017 AFR: 2.4%
Gift Annuity State Regulations

Florida


Intestacy


General Definition

A decedent's intestate estate is defined as any part of a decedent's estate not effectively disposed of by a valid will.

Order of Distribution

The intestate share of the surviving spouse is as follows
  1. If there is no surviving descendant of the decedent, the entire intestate estate.
  2. If the decedent is survived by one or more descendants, all of whom are also descendants of the surviving spouse, and the surviving spouse has no other descendant, the entire intestate estate.
  3. If there are one or more surviving descendants of the decedent who are not lineal descendants of the surviving spouse, one-half of the intestate estate.
  4. If there are one or more surviving descendants of the decedent, all of whom are also descendants of the surviving spouse, and the surviving spouse has one or more descendants who are not descendants of the decedent, one-half of the intestate estate.Sec. 732.102.

The part of the intestate estate not passing to the surviving spouse under Sec.732.102 or the entire intestate estate, if there is no surviving spouse, will be distributed as follows:

  1. To the descendants of the decedent.
  2. If there is no descendant, to the decedent's father and mother equally, or to the survivor of them.
  3. If there is none of the foregoing, to the decedent's brothers and sisters and the descendants of deceased brothers and sisters.
  4. If there is none of the foregoing, the estate must be divided, 1/2 to the decedent's paternal, and the other 1/2 to the decedent's maternal, kindred in the following order: (a) To the grandfather and grandmother equally, or to the survivor of them. (b) If there is no grandfather or grandmother, to uncles and aunts and descendants of deceased uncles and aunts of the decedent. (c) If there is either no paternal kindred or no maternal kindred, the estate will go to the other kindred who survive, in the order stated above.
  5. If there is no kindred of either part, the whole of the property will go to the kindred of the last deceased spouse of the decedent as if the deceased spouse had survived the decedent and then died intestate entitled to the estate. Sec. 732.103.

If here is no taker, the estate passes to the State of Florida. Property that escheats will be sold and the proceeds paid to the Chief Financial Officer of the state. At any time within ten years after the payment to the Chief Financial Officer, a person claiming to be entitled to the proceeds may reopen the administration to assert entitlement to the proceeds. If no claim is timely asserted, the state's rights to the proceeds will become absolute. Sec. 732.107.

Will Qualifications


Common Law or Community Property

Florida is a common law, elective share state.

Capacity

An individual who is of sound mind who is either 18 or more years of age or an emancipated minor may make a will. Sec. 732.501.

Drafting

Every will must be in writing and the testator must sign the will at the end or the testator's name must be subscribed at the end of the will by some other person in the testator's presence and by the testator's direction. The testator must sign or acknowledge the will in the presence of at least two attesting witnesses. The attesting witnesses must sign the will in the presence of the testator and in the presence of each other.

Any will, other than a holographic or nuncupative will, executed by a nonresident of Florida, either before or after this law takes effect, is valid as a will in this state if valid under the laws of the state or country where the will was executed. A will in the testator's handwriting that has been executed in accordance with subsection (1) will not be considered a holographic will.

A will or codicil executed in conformity with Sec. 732.502 may be made self-proved at the time of its execution by the acknowledgment of it by the testator and the affidavits of the witnesses, made before an officer authorized to administer oaths and evidenced by the officer's certificate attached to or following the will. Sec. 732.503.

Beneficiaries

A beneficiary includes, in the case of a decedent's estate, an heir, legatee and devisee and, in the case of a trust, an income beneficiary and a remainder beneficiary.

Modifications

A codicil must be executed with the same formalities as a will. Sec. 732.502.

A will or codicil, or any part of either, is revoked by a subsequent inconsistent will or codicil, even though the subsequent inconsistent will or codicil does not expressly revoke all previous wills or codicils. Sec. 732.505. Further, a will or codicil is revoked by the testator, or some other person in the testator's presence and at the testator's direction, by burning, tearing, canceling, defacing, obliterating, or destroying it with the intent, and for the purpose of revocation. Sec. 732.506.

Any provision of a will executed by a married person that affects the spouse of that person will become void upon the divorce of that person or upon the dissolution or annulment of the marriage. After the dissolution, divorce, or annulment, the will must be administered and construed as if the former spouse had died at the time of the dissolution, divorce, or annulment of the marriage, unless the will or the dissolution or divorce judgment expressly provides otherwise. Sec. 732.507.

Probate Process


Naming of Personal Representative

In granting letters of administration, the following order of preference must be observed:

  1. The personal representative, or his or her successor, nominated by the will or pursuant to a power conferred in the will.
  2. The person selected by a majority in interest of the persons entitled to the estate.
  3. A devisee under the will. If more than one devisee applies, the court may select the one best qualified. Sec. 733.301(1)(a).

If no application is made by any of the persons described above, the court will appoint a capable person; but no person may be appointed who:

  1. Works for, or holds public office under, the court.
  2. Is employed by, or holds office under, any judge exercising probate jurisdiction. Sec. 733.301(3).

Submission of Will

Until admitted to probate in Florida or in the state where the decedent was domiciled, a decedent's will is ineffective to prove title to, or the right to possession of, property of the testator. Sec. 733.103.

The custodian of a will must deposit the will with the clerk of the court having venue of the estate of the decedent within ten days after receiving information that the testator is dead. The custodian must supply the testator's date of death or social security number to the clerk upon deposit. Sec. 732.901(1).

Upon petition and notice, the custodian of any will may be compelled to produce and deposit the will. All costs, damages and a reasonable attorney's fee will be adjudged to petitioner against the delinquent custodian if the court finds that the custodian had no just or reasonable cause for failing to deposit the will. Sec. 732.901(2).

Inventory

A personal representative must file a verified inventory of property of the estate, listing it with reasonable detail and including for each listed item its estimated fair market value at the date of the decedent's death. Sec. 733.604.

Homestead, Exempt Property, Family Allowance and the Elective Share:

If the decedent is survived by a spouse and one or more descendants, the surviving spouse is entitled a life estate in the homestead, with a vested remainder to the descendants living at the time of the decedent's death, per stirpes. Sec. 732.401(1). In lieu of a life estate under subsection (1), the surviving spouse may elect to take an undivided one-half interest in the homestead as a tenant in common, with the remaining undivided one-half interest vesting in the decedent's descendants in being at the time of the decedent?s death, per stirpes. Sec. 732.401(2)

The surviving spouse, or, if there is no surviving spouse, the children of the decedent have the right to the "exempt property." Exempt property shall consist of:

  1. Household furniture, furnishings, and appliances in the decedent's usual place of abode up to a net value of $20,000 as of the date of death.
  2. Two motor vehicles used by the decedent or members of the decedent's immediate family as their personal motor vehicles.
  3. All qualified 529 tuition programs. Sec.732.402.
  4. All death benefits available to teachers and administrators under Sec. 112.1915. Sec.732.402.

The surviving spouse and the decedent's lineal heirs the decedent was supporting or was obligated to support are entitled to a reasonable allowance in money out of the estate for their maintenance during administration. The court may order this allowance to be paid as a lump sum or in periodic installments. The allowance may not exceed a total of $18,000. Sec. 732.403.

The surviving spouse of a person who dies domiciled in Florida has the right to a share of the elective estate of the decedent in an amount equal to 30%. Sec. 732.101 and Sec. 732.2065.

Debts and Distributions

The personal representative must pay all claims within one year from the date of first publication of notice to creditors, provided that the time may be extended with respect to claims in litigation, unmatured claims and contingent claims for the period necessary to dispose of those claims. The court may extend the time for payment of any claim upon a showing of good cause. Sec. 733.705.

The personal representative must pay the expenses of the administration and obligations of the decedent's estate in the following order:

  1. Costs, expenses of administration and compensation of personal representatives and their attorneys fees.
  2. Reasonable funeral, interment and grave marker expenses, whether paid by a guardian, the personal representative or any other person, not to exceed the aggregate of $6,000.
  3. Debts and taxes with preference under federal law.
  4. Reasonable and necessary medical and hospital expenses of the last 60 days of the last illness of the decedent, including compensation of persons attending the decedent.
  5. Family allowance.
  6. Arrearage from court-ordered child support.
  7. Debts acquired after death by the continuation of the decedent's business but only to the extent of the assets of that business.
  8. All other claims, including those founded on judgments or decrees rendered against the decedent during the decedent's lifetime. Sec. 733-707.

Estate/Inheritance Tax


The estate tax is the amount by which the federal credit exceeds the aggregated amount of all constitutionally valid taxes paid to other states on behalf of the decedent's estate. Sec. 198.02.

However, with the federal repeal of the credit for state estate taxes in 2005, there is currently no estate tax.

Income Tax Charitable Deductions and/or Credits


No personal income tax in Florida.

Gift Annuity Requirements


Florida, a "registration" state, regulates the issuance of charitable gift annuities under Florida Statutes Sec. 627.481. Some of the relevant Florida Administrative Code Provisions are listed under Chapter 690-202. Charities must provide information to several state agencies/departments in order to issue gift annuities in Florida.

To qualify, the organization must (i) have been in active operation for at least five years as a Sec. 501(c)(3) tax-exempt organization or (ii) have been incorporated for at least two years and issued annuity agreements in at least three other states without compliant while functioning as a wholly controlled subunit of a trust or organization that has satisfied (i) for at least 10 years. The charity must also maintain a segregated reserve account fund for all gift annuities not properly reinsured with a Florida insurance company. Annuity payout rates must be calculated to provide 50% of the residuum to charity.

Application Process

To notify the Office of Insurance Regulation, the charity must submit a Notification to the Office of Insurance Regulation of Donor Annuity Agreements Pursuant to Sec. 627.481, Florida Statutes. No fee is required. This form must be signed by two or more of the charity's officers or directors, identify the organization and certify that the organization meets the requirements of Sec. 627.481 mentioned above.

To register as a charity soliciting contributions (such as gift annuities), under the Solicitation of Contributions Act in Florida Statutes Sec. 496.405, the charity must submit a Registration Statement to the Florida Department of Agriculture & Consumer Services: Division of Consumer Services. The fee is based on a sliding scale that corresponds to the contributions received by the charity within the past fiscal year. The form (Charitable Organizations/Sponsors Registration Application) requires the charity to provide information on management, the custodian of contributions, the identity of solicitors (actual contract also required if solicitors are professional hires) documentation of the charity's tax-exempt status and the charity's most recently filed Form 990.

In addition, any charity not incorporated in Florida must apply to conduct business in the state by filing with the Department of State's Division of Corporations (or obtain proof of exemption from registration). The form (Application by Foreign Not For Profit Corporation for Authorization to Conduct Its Affairs in Florida) requires submission of a list of directors and officers and a certificate of existence not more than 90 days old from the domiciliary state. The fee is $70 and up.

Disclosure Language

Florida requires all charities include certain disclosure language in the annuity agreement itself, such as:

"This annuity is not issued by an insurance company, is subject only to limited regulation by the State of Florida and is not protected or otherwise guaranteed by any government agency."

Florida state institutions of higher learning are required to include the following additional disclosure:

"This agreement is the entire contract between the parties, with rights and responsibilities of each party to the other as set forth herein. The donor or annuitant shall not have recourse against any assets of the state other than any funds or assets donated by, or funds derived from any assets donated by, the donor as set forth herein."

Reserve Requirements

The segregated fund must maintain assets at least equal to the sum of the reserves on its outstanding annuity agreements plus a surplus of 10%. The reserve amount is to be calculated following assumptions set forth in Sec. 627.481(2)(a)b. Florida imposes some investment restrictions on the fund, specifically that the fund assets cannot be invested in more than 50% equities (including mutual funds) and no more than 10% in any one stock or mutual fund. However, charities incorporated outside of Florida may instead invest its fund as permitted by its domicile state.

Annual Filing Requirements

Once the above information is successfully submitted, Florida requires annual statements to be filed with both the Office of Insurance Regulation and the Department of Consumer Services. With the Florida Office of Insurance Regulation, the charity files the "Sworn Statements in Lieu of Annual Statements for Issuers of Donor Annuity Agreements" within 60 days of the charity's fiscal year end. With the Florida Department of Agriculture & Consumer Services, the charity will receive a renewal statement, the "Charitable Organizations/Sponsors Registration Application," from the Department sixty (60) days before the renewal date (one year from the initial date of compliance with this Department). Failure to do so results in a $25 fee for each month or part of a month the renewal is late.

State Contact Information

Florida Office of Insurance Regulation
Specialty Product Administration
200 E. Gaines Street
Tallahassee, FL 32399-0331
(850) 413-3144
(800) 342-2762

Florida Department of Agriculture and Consumer Services
Solicitation of Contributions
P.O. Box 6700
Tallahassee, FL 32399-6700
(800) 435-7352 Calling from Florida
(850) 488-2221 Calling from outside of Florida
cswebmaster@doacs.state.fl.us

Florida Department of State
New Filing Section, Division of Corporations
PO Box 6327
Tallahassee, FL 32341
(850) 245-6052
also
2661 Executive Center Circle
Tallahassee, FL 32301

State Forms

For more information on state-specific form requirements, please contact Crescendo at 800-858-9154.
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