Florida Irrevocable Grantor Homestead Trust: Having Your Cake and Eating It Too – First Course

Published: March 1, 2024

Authored by Dean Mead estate planning attorney Joseph Percopo, following is an excerpt of the article “Florida Irrevocable Grantor Homestead Trust: Having Your Cake and Eating It Too – First Course,” published in the March/April edition (Vol. 98, No. 2) of The Florida Bar Journal. To read the article in its entirety click here. 

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The popular idiom, “you can’t have your cake and eat it too,” is used to convey the concept that in certain circumstances it is not possible to simultaneously retain two benefits (if you eat the cake, then you no longer have the cake). On its face, it would seem that this idiom applies equally to Florida homestead because it is generally not possible to have homestead benefits without homestead burdens. However, it may be possible to have your cake and eat it too by using a Florida irrevocable grantor homestead trust (FIGHT) to retain homestead benefits while simultaneously avoiding homestead burdens.

The FIGHT requires a lifetime conveyance of the homestead to the trustee of an irrevocable trust. To understand how a FIGHT may be able to provide homestead benefits without burdens, an initial fundamental understanding of Florida homestead is necessary. Florida protects homestead in three ways, each with its own rules and requirements: 1) tax benefits, 2) creditor exemption, and 3) alienation restrictions.