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Some estate planning considerations for out-of-state property owners

While the idea of owning more than one piece of real property may seem imprudent to the more fiscally conservative among us, the fact remains that a very large number of people own multiple properties not just in their home states but across the nation. Indeed, they may own rental property, vacation property, so-called snowbird property or family property.

Regardless of the purposes for which these secondary properties are held, it’s imperative that owners make the necessary estate planning arrangements in order to minimize taxes and ensure an otherwise orderly distribution.

This is an especially true for those people who own any property in another state and have chosen to make Florida their domicile for tax purposes.

That’s because of the recent decision by Florida’s Fourth District Court of Appeals in Brown v. Brown.

According to the facts of the case, the decedent was domiciled in the Sunshine State and owned real property in neighboring Georgia. During the subsequent probate proceedings, the probate court ordered the personal representative to initiate the process of distributing the Georgia-based real property.

A challenge to this order was filed by one of the beneficiaries, who argued that the Florida probate court did not have any jurisdiction over the Georgia-based real property.

The matter made it all the way to the appellate court, where the judges held that the jurisdiction of Florida’s probate courts is indeed confined to the state borders, such that another action would need to be opened in Georgia to distribute the property.

“When a testator executes a will devising lands in two or more states, the courts in each state construe it as to the lands located therein as if devised by separate wills,” read the opinion.

In light of this decision, Florida residents who own property in other states will likely want to consider doing everything in their power to ensure that their heirs won’t have to go through multiple probates, something that can prove to be costly and time-consuming.

One such step would be to consider sitting down with an experienced estate planning attorney who can help them explore viable options for not just avoiding probate altogether, but also minimizing estate taxes.   

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