A number of sources (including Forbes, most prominently) report that the Florida Legislature will take up a bill aimed at bringing sense to the chaotic 2010 estate tax gap. 

As I previously wrote (here), the one-year estate tax hiatus may cause many wills and trusts to produce gifting consequences that were never intended by the maker (who unfotunately dies in 2010).  This is because many wills and trusts contain formula provisions that rely on the existence of a Federal estate tax and estate tax credit.  These provisions generally determine how much of the estate should go to the surviving spouse or a marital trust and who much should go to a credit shelter (or bypass) trust.  When there is no Federal estate tax, these formulas may cause the entire estate to go entirely to one trust or the other, leaving the other trust entirely unfunded. 

The Florida Legislature will consider a bill that would allow any will or trust to contain these (now) nonsensical formulary provisions to be reviewed by the probate court, which could rule on what the maker would have wanted given today’s estate tax hiatus.  This approach may be more burdensome than the approach being pushed in some other states (most notably Virginia), which would create a presumption that will or trust forumulary provisions be interpretted as if Federal estate taxes continued in their 2009 form.  On the other hand, the Florida approach would allow flexibility for the personal representative to petition for an interpretation of the will or trust that will best serve the estate and the beneficiaries given the current situation.  In either case, some direction is better than nothing.