Florida Estate Planning for Canadian Snowbirds
According to various reports, Canadians own 500,000 homes across Florida. They are the largest foreign buyers of Florida real estate by a considerable margin, and this should not come as a huge surprise when you consider the freezing temperatures of the True North. Many of these Canadians are self-professed “snowbirds” who move down south during the winter. But how do you approach estate planning if your property is divided between Florida and another country? Could an international estate planning lawyer in Tampa help?
Don’t Assume Florida and Canada Have the Same Laws
A common mistake among Canadian snowbirds is to assume that the laws in these two jurisdictions are virtually identical. Florida has distinct estate planning and tax laws, and snowbirds should strive to understand these distinctions before building an estate plan. It may be worth consulting with a local Florida estate planning lawyer to approach this challenge with greater confidence. In contrast, a Canadian lawyer might only have a cursory understanding of Florida laws.
Should You Relocate to Florida for More Than Six Months Out of the Year?
If you plan to relocate to Florida for more than six months out of the year, you can take advantage of the state’s homestead exemption. This is just one example of a tax benefit associated with the Sunshine State, and there are many others to consider. This law essentially makes your Florida property impervious to most claims from creditors. This is why Florida is often referred to as a “debtor’s paradise.”
It might be highly beneficial for a Canadian couple with excessive debt to relocate to Florida for more than six months out of the year, transferring their wealth into Florida real estate and using the homestead exemption to avoid debt collections. For snowbirds with considerable assets in Canada, however, this strategy may not be suitable. Once you begin living in another country for more than six months out of the year, this could trigger capital gains implications in Canada and a range of other concerns.
The US federal government also offers considerable tax benefits for high-net-worth individuals. The obvious example is the federal estate and gift tax exemption, which has reached well over $13 million USD.
Consider Putting Your Florida Property into a Trust
A common issue among Canadian snowbirds is multiple probates. In other words, Florida property may need to go through a different court process compared to your Canadian property after you pass. To avoid this issue, consider putting your Florida property into a trust. This makes the property exempt from probate, and your beneficiaries can inherit it more easily.
Can an Estate Planning Lawyer in Seminole Help?
If you’re unsure of how to handle property split between Florida and another country, an experienced international estate planning lawyer in New Port Richey may be able to help. This situation is actually quite common, especially among Canadians – and an estate planning lawyer can help you approach various challenges with confidence. Contact Knudsen Law today to learn more.
Sources:
theglobeandmail.com/investing/article-snowbirds-beware-canadians-who-own-homes-in-florida-will-find-it-a-lot/
mortgagesandbox.com/news/the-growing-risk-for-florida-snowbirds-why-arizona-and-california-are-better-bets#:~:text=Canadians%20are%20estimated%20to%20own%20500%2C000%20homes%20in%20Florida.
