Florida is one of the strongest asset-protection states in the country, but the rules require timing, structure, and follow-through. Allie Castellano helps Sarasota families and business owners put effective Florida asset-protection strategies in place early.
Florida is one of the more protective states for residents who plan correctly. The state gives broad protection to homestead property, certain retirement accounts, life insurance, annuities, and assets owned by married couples as tenants by the entireties. Florida also has no state income tax or estate tax.
Those protections are useful, but they are not automatic answers to every risk. Each one has rules. A home has to qualify as a homestead. Tenancy by the entireties must be structured correctly. Retirement-account protection depends on the account type. Transfers made after a creditor problem appears may be challenged.
Florida’s Uniform Fraudulent Transfer Act, Fla. Stat. Ch. 726, limits what can be done once a lawsuit, a creditor claim, or a financial problem is already foreseeable.
Asset protection works best when it is built into the estate plan early, before a specific claim is on the horizon.
Florida’s Built-In Asset Protections
Several layers of Florida law protect Sarasota residents’ assets without any active planning:
Homestead. Article X §4 of the Florida Constitution
Florida homestead protection is one of the state’s strongest creditor protections.
For a qualifying primary residence, the protection is unlimited in dollar amount. The size limit is up to one-half acre inside a municipality and up to 160 acres outside a municipality.
The protection applies during life against many creditors and may continue in a different form after death under Fla. Stat. § 732.401 , which controls how the homestead passes when a surviving spouse or descendants are involved.
Bankruptcy has its own limit. Under 11 U.S.C. § 522(p) , the federal Bankruptcy Code may limit homestead protection for property acquired within 1,215 days before filing. Outside of that issue, Florida homestead remains one of the strongest protections available.
Tenancy by the entireties (TBE)
Married couples in Florida may own certain property as tenants by the entirety (TBE).
TBE property is treated as owned by the marital unit rather than by either spouse alone. That means a creditor of only one spouse generally cannot reach the property. A joint creditor of both spouses may be different.
For Florida real estate, TBE is often presumed when property is properly titled in both spouses’ names. For personal property, the ownership structure should be expressly created. The Florida Supreme Court’s decision in Beal Bank v. Almand is often cited on this point.
Retirement accounts. Fla. Stat. §222.21
IRAs, 401(k)s, 403(b)s, defined-benefit pensions, and most qualified retirement accounts are exempt from creditor claims under Fla. Stat. §222.21. Inherited IRAs received from a non-spouse decedent are exempt from Florida estate tax, an important contrast with the federal Clark v. Rameker result.
Life insurance and annuities
Florida protects certain life insurance and annuity interests.
Under Fla. Stat. § 222.14 , the cash surrender value of life insurance policies on the life of a Florida resident may be exempt from the insured’s creditors. Annuities may also receive protection under the statute.
These tools can also intersect with estate planning, beneficiary planning, and Medicaid planning, so policy ownership and beneficiary designations should be reviewed carefully.
Wages
Florida exempts the wages of a head of household earning $750/week or less from garnishment under §222.11, and an exemption may be claimed for higher-earning heads of household by waiving certain protections in writing.
The Fraudulent Transfer Risk
Florida’s Uniform Fraudulent Transfer Act, Fla. Stat. Ch. 726, is the primary risk to any asset-protection plan. UFTA creates two avenues for creditors to unwind a transfer:
- Actual fraud (§726.105(1)(a)) , transfer made “with actual intent to hinder, delay, or defraud” any creditor. The statute lists eleven “badges of fraud” that courts use to infer intent, close family transferee, transferor retained possession, threat of suit when transfer occurred, transfer of substantially all assets, etc.
- Constructive fraud (§726.105(1)(b)) , transfer for less than reasonably equivalent value, where the transferor was insolvent or became insolvent, regardless of intent.
The statute of limitations is generally four years from the transfer, or one year from when the transfer reasonably could have been discovered, under § 726.110 .
The practical point: asset protection should happen before creditor trouble is visible. Rushed transfers after a claim appears are often the easiest to challenge.
Medicaid-Compatible Asset Protection
Long-term care costs can be one of the biggest asset risks for Sarasota families.
Florida Medicaid has a 60-month look-back period under 42 U.S.C. § 1396p(c)(1)(B)(i) . Transfers for less than fair market value during that period may result in a penalty affecting Institutional Care Program eligibility.
A properly drafted Medicaid Asset Protection Trust , or MAPT, may help preserve assets if it is created and funded well before Medicaid is needed. The trust must be irrevocable, and the grantor must give up the required level of control.
A MAPT should not be drafted in isolation. A trust designed only for Medicaid may not address creditor exposure, tax basis, family control, or beneficiary issues. A trust designed solely for creditor protection may fail to meet Medicaid timing rules.
For full Medicaid-planning depth, see our Sarasota Medicaid Planning page.
Asset Protection Trusts and Other Structures
Beyond Florida’s built-in protections, several structures offer additional asset-protection capacity:
- Domestic asset protection trusts (DAPTs) : Florida is not a DAPT state, but Florida residents may use trusts in states such as Nevada, Delaware, or South Dakota when choice-of-law, administration, and fraudulent-transfer risks are handled correctly.
- Family Limited Partnerships (FLPs) and LLCs: These entities can help separate business or investment assets and may limit a creditor to a charging order remedy under Fla. Stat. § 605.0503 for LLCs and § 620.1703 for limited partnerships.
- Irrevocable life insurance trusts (ILITs): An ILIT may remove life insurance proceeds from the insured’s estate and protect them for selected beneficiaries.
- Spendthrift trusts : Florida recognizes spendthrift provisions under Fla. Stat. § 736.0502 , which can protect trust assets from a beneficiary’s creditors when administered properly.
- Offshore trusts: These may be considered for certain high-risk or high-net-worth situations, but they involve significant compliance, tax reporting, and choice-of-law issues.
Asset protection is usually stronger when several tools work together. Florida exemptions, proper ownership, entity planning, insurance planning, and carefully timed trusts are often more durable than one tactic used alone.
Post-OBBBA Asset Protection. Why It Matters Now
The One Big Beautiful Bill Act , signed July 4, 2025 (Pub. L. 119-21), made the federal estate-tax exemption permanent at $15 million per individual ($30 million per married couple) effective January 1, 2026 . The TCJA “exemption cliff” that asset-protection content warned about for years no longer exists.
For most Florida families, estate tax is no longer the central asset-protection concern. Fewer than 0.1% of Florida estates are expected to owe federal estate tax under the new exemption.
Planning now often focuses more on:
- Creditor protection , the homestead, TBE, and entity-structure layers of Florida’s protective regime.
- Long-term care funding . Medicaid-compatible asset structures with proper look-back timing.
- Family governance , succession planning, blended-family conflict prevention, and generational wealth transfer.
- Basis planning , preserving step-up at death where appropriate, particularly for Florida real estate and family-business interests.
Some older asset-protection pages still warn about the 2026 exemption cliff. The current planning focus should reflect the post-OBBBA landscape. For Sarasota residents who own substantial business interests, see our Florida Estate Tax Planning page for the broader post-OBBBA framework.
How Allie Castellano Helps
Allie Castellano leads the firm’s estate planning practice and works with Sarasota families and business owners on asset-protection planning across the full range:
- Florida statutory exemption review (homestead, TBE, retirement, life insurance).
- Fraudulent-transfer compliance analysis.
- Medicaid Asset Protection Trust design and timing.
- LLC, FLP, and entity-based protection planning (in coordination with the firm’s business law practice).
- ILITs, spendthrift trusts, and other trust structures.
- Coordination with Florida Estate Tax Planning under the post-OBBBA framework.
- Cross-state planning for clients with assets in jurisdictions other than Florida.
The first consultation is free. Ongoing work is priced on a flat-fee basis where the matter is well-defined.
Frequently Asked Questions About Sarasota Asset Protection
How does Florida homestead protection from creditors work after death?
Florida homestead protection may continue after death, but the rules change. Under Fla. Stat. § 732.401 , if there is a surviving spouse and lineal descendants, the spouse may receive a life estate or elect a one-half tenancy-in-common interest, with descendants receiving the remainder. Homestead also has restrictions when a spouse or minor child survives.
How does tenancy by the entireties protect a married couple’s assets from one spouse’s creditors in Florida?
TBE property is owned by the marital unit. A creditor of only one spouse generally cannot reach it. A creditor of both spouses may be different. Real estate may be presumed TBE if titled correctly, while personal property should be expressly structured under Beal Bank v. Almand .
Does putting my house in a revocable living trust cause me to lose the Florida homestead tax exemption or the Save Our Homes cap?
Not if the trust is drafted correctly. A revocable trust can preserve the homestead tax exemption and Save Our Homes cap when the occupant keeps the required beneficial interest. Poor drafting can create problems, so the trust language matters.
Are my retirement accounts protected from creditors in Florida?
In most cases, yes. Fla. Stat. § 222.21 protects many retirement accounts, including IRAs, 401(k)s, 403(b)s, defined-benefit plans, and similar qualified plans. Florida also gives protection to certain inherited IRAs.
Can I move assets into protection now to defeat a known creditor?
Usually no. Transfers made after a creditor problem is known or foreseeable may be challenged under Fla. Stat. Ch. 726 . Asset protection works best when put in place before any specific claim, lawsuit, or debt crisis arises.
If you are a Sarasota resident, business owner, or professional thinking about how Florida’s asset-protection laws might support your long-term plan, Buckman, Buckman & Castellano, P.A. can help.
Allie Castellano serves clients across Sarasota, Venice, Bradenton, North Port, and surrounding communities. To schedule a free consultation, please contact our office .
This content is for informational purposes only and does not constitute legal advice. Past results in any legal matter depend on the specific facts of that matter and do not guarantee or predict future outcomes. Testimonials, where used, reflect individual client experiences; your results may differ. Reading this page or contacting our office does not create an attorney-client relationship; an attorney-client relationship is formed only after a written engagement agreement is signed by both you and the firm.
