Answers for Your Probate and Trust Administration Questions
There are a wide variety of legal options and potential pitfalls when it comes to probate and trust administration. The experienced lawyers at DeLoach, Hofstra & Cavonis, P.A. have been offering guidance and preparing plans for individuals and families so they can protect their assets and leave a lasting legacy. Here, we address many common questions families ask, drawing on our combined 60 years of probate and trust service to Floridians.
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How Is the Probate Estate Closed?
Once all assets have been gathered, inventoried, the 90 day creditor’s period has run, and payment of claims, if any, have been made, the estate can usually start making the distribution of assets. Interested parties are provided a Petition for Discharge, setting forth the personal representative’s fee, attorney’s fees, estimated final costs, and an accounting of all of the estate’s income and expenditures. As all of the assets will be known at this point, the beneficiaries will receive the amount of their inheritance.
If all beneficiaries agree to the Petition for Discharge, the estate can be finalized quickly. Assets can then be distributed to the beneficiaries, costs paid, etc. In the event of problems, the beneficiaries have 30 days in order to make objection to the Petition for Discharge. If an objection is filed by a beneficiary, the probate court may require a hearing on the objection’s validity.
As previously discussed, the full probate process takes about 6-7 months from start to finish under most circumstances.
What Will I Need to Start the Probate Process?
After reviewing the decedent’s assets, the family will generally determine that they need a probate attorney to get things started. Sometimes a financial institution such as a bank or insurance company will inform the family that they need “letters from the court” or something to this affect. Before seeing an attorney, the family will generally want/need the following information:
- Original Last Will and Testament (if one exists)
- If the original cannot be found, the attorney will have a way of "proving" the copy
- At least original death certificate – short form (2 if real property is involved)
- Preliminary list of decedent’s probate assets
- Names and address of all persons named in the last will and testament, if known, or name/address of intestate beneficiaries
Once the probate attorney is hired, a petition for administration is sent to the court. If all works well, the court then issues letters of administration, which allows the personal representative the legal authority to act on behalf of the estate.
The process mentioned is for a formal probate administration. If the estate is simple and worth less than $75,000, then a summary administration may be available, although the documentation needed for a formal probate is the same as that of a summary.
- Original Last Will and Testament (if one exists)
How Do I Find The Right Probate Attorney?
You should first start by gathering the names of potential attorneys. If you know any attorneys in the area, that is a good place to start. The attorney you know may practice in probate or may be close to an attorney who does. You can also use the internet to find an attorney. Do not type in “probate attorneys” as this will call up a million results. Rather, type in “probate attorney in ___ [your town] Florida.”
Look for lawyers who practice primarily in probate and estate planning. A lawyer who specializes is better than a “jack of all trades” type of firm or lawyer. Today, the law is more complex than ever and you need an attorney who stays on top of his or her primary field. When you meet with the prospective attorney, be prepared to ask the following questions:
- What are their primary areas of practice?
- How many probate cases have you handled?
- Would your past probate clients recommend you?
- How many continuing legal education conferences to you attend each year?
- Do you have experienced paralegals who will help you?
- What are your fees and how do you calculate them?
- Do they bill by the hour or will they use a flat fee?
Of course, you should be comfortable with the attorney you hire, have a good rapport, and feel that you can go to them in the event problems arise.
What Makes an Asset Go Through Probate Upon Death?
Most people know that when they die, they want their assets to avoid the probate process. Most people do not even know what probate is, but they know they want to avoid it. But what is probate and, even more important, when do assets go through probate in Florida?
First, probate is the court process to properly settle your estate upon your death. The probate process was created to make sure the decedent's taxes are paid, legally enforceable bills are paid, and assets go to the right people (i.e., their heirs). Their are four types of probate in Florida, each applying in very specific situations. The four types are:
- Formal Administration: A typical "probate" process where the court appoints the personal representative (i.e., "executor") to settle the estate.
- Summary Administration: A shorter and more simple form of probate when assets are less than $75,000 and all of the decedent's bills are paid (among other matters).
- Disposition without Administration: Not really a probate, per se, but a simple way for a family member or other person to get paid for last funeral costs.
- Ancillary Administration: When the decedent was not a resident of Florida but owned real property here.
We have more on the types of Florida probates here.
Let's get back to the question posted - what makes an asset go through probate in the first place? Probate assets are assets that were either:
- In the decedent's own, individual name upon their death; or
- Did not have a beneficiary designation upon death.
Assets in the decedent's own, individual name would be just about anything - bank accounts, stocks, bonds, brokerage accounts, real property (i.e., land), and more. When someone dies with these assets, no matter what the value, the family/heirs will need to look to one of the processes above in order to take control of the asset.
If someone had a life insurance policy, IRA, 401k, etc., that did not have a beneficiary designation, that asset would also be subject to the probate process.
Example of Probate Assets:
Mom dies with a bank account and her homestead property, both in her individual, individual name. The family/heirs will need to see a probate attorney to gain control of the bank account and to sell the home.
Where are Probate Assets Distributed?
Probate assets are distributed according to the decedent's last will and testament, if they have one, and if not, then according to the laws of intestacy, which roughly means going to your family in the order set forth in the Florida statutes.
What Should I do to Avoid Probate?
There are a number of ways to avoid probate with your own estate plan. If you want to learn more about how to avoid probate, please download a copy of my book, The Top 20 Rules to Protect Your Florida Estate.
If you want to learn more about probate:
- Do I need to hire an attorney to probate a Florida estate?
- Does probate have a small estate affidavit?
- Download our free book, Navigating the Florida Probate Process!
Does Florida Have a Small Estate Affidavit Process?
The general answer is no, or at least not in the way that is helpful to most families.
We usually get this question when someone dies without a beneficiary of a life insurance policy, IRA or 401K. When the family is trying to claim these funds upon the death of a loved one, the financial company may send a claim form with a statement about a "small estate affidavit" that would be necessary in order for the family to receive the assets. Unfortunately, Florida does not have a small estate affidavit process, with one exception, which means the family will more than likely need to consult a probate attorney to help gain control of the assets.
In order for the family/heirs to take control of a decedent's probate assets, Florida generally has three types of probate to discuss:
- Formal Probate Administration: Full blown probate, going to court, need an attorney, generally used under most probates, taking 6-9 months under most circumstances.
- Summary Probate: Reserved for estates under $75,000 in very simple estates. An attorney is advised in these situations due to complexity. A court order is also done.
- Disposition without Administration:Used in very specific situations, typically where the decedent's funeral expenses are unpaid. Here, the family can go to the local probate court and file an Petition to release funds held in a bank (typically) so that the petitioner can be reimbursed for paying the decedent's funeral bill. An example of the Disposition without Administration is as follows:
Mom died with a bank account of $3,000 in her own, individual name. The bank will not give the family access to this bank account. The decedent's son paid for mom's funeral expenses of $4,000 out of his own pocket. With the proper petition to the court, the court will order the bank to pay the $3,000 to the son to reimburse him for paying the funeral bill. Here is Pinellas County's petition.
In all three types of Florida probate, the court process is involved - some probates processes are easier than others. But there is no form or affidavit in Florida that an heir can sign that will give that heir legal rights to estate assets - only the Court can sign an order to this effect.
To learn more about the difference between the disposition without administration/summary administration, I have written more on the types of Probate in Florida that would be helpful if you cannot get control of an assets upon someone's death. This may or may not mean you need to hire an attorney upon the death of your loved one.
If your loved one has passed and you are trying to access their assets, our free guide to Navigating the Florida Probate Process will be very helpful. This guide reviews the Florida probate process from start to finish.
If you asked this, you may want to know:
Does Florida Have a Minimum Amount Needed for Probate?
When someone dies in Florida, how do we know if probate will be necessary? The answer is if someone had an asset in their own, individual name. The size of the asset does not matter for Florida purposes, just the titling. So if the decedent dies with a bank account worth only $2,000 in their own name, the family/heirs will need some type of help from probate and the court system. Depending on the size of the estate, the probate process differs greatly. Florida generally has three probate processes to consider:
- Disposition without Administration: This process is available some very small estates and technically does not involve the probate process. It does, however, involve the Florida Court system. It is available for someone who is seeking to get reimbursed a funeral bill or for medical expenses within 60 days of death. Here is a link to the Disposition without Administration process in the Pinellas County Clerk of Court's website.
Example: Mom dies with $2,000 in a bank account in her own name. The bank will not let anyone access the funds and tells people they need to get "letters from the court." If someone paid for mom's funeral out of their own pocket, that person can go to the Clerk of Court where mom passed and get a court order directing the bank to pay them the $2,000.
- Summary Administration: This is a more simple probate process that is available only when:
- the probate assets are worth less than $75,000;
- all the heirs consent to the petition;
- all of the decedent's bills are paid (a big issue with summary administrations); and
- all of the decedent's assets are known (if something else is found in the future, you have to go back to court again!)
With a summary administration, the family does not need an attorney to do the filing BUT the process is difficult and an attorney would likely be necessary. We help people all the time after they file their summary paperwork and the court does not allow it due to deficiencies.
- Formal Probate Administration: This is the full probate process of appointing the personal representative, dealing with creditors, publishing in the newspaper, etc. This is done when assets exceed $75,000, the estate has debts, heirs do not agree, there are unknown assets, and more.
If your loved one has recently passed and your family is looking to probate an asset, please download our free guide on Navigating the Florida Probate Process to learn more.
How Much Do We Charge for Probate?
Many people are often shopping for attorneys upon a loved one's death. Our preferred method on starting any probate is to get together for a free initial consultation. In our initial consultation, we will likely send you a questionnaire to complete to assist everyone. We would review the completed questionnaire, review the decedent’s assets, the estate planning documents (i.e., will and/or trust), and then quote you a fee for our services.
Our office general charges a fee in accordance with Florida Statutes 733.6171. Under the Florida Statutes, an attorney is entitled to a “reasonable fee” to act as the estate’s attorney. Generally, a reasonable fee under the Florida Statutes is 3% of the probate estate’s inventory value on the first $1,000,000. An example is as follows:
The estate inventory showed a gross value of $200,000, which consisted of bank accounts, stocks and bonds. According to the statute, a reasonable attorney’s fee would be $6,000 (3% of $200,000).
Every situation is different so we will be more than happy to meet, review the probate, and quote you a fee for our services in our initial meeting so that there are no surprises.
People who have read this may want to read:
Will I have to pay income taxes on my Florida Inheritance?
If your loved one recently died, you may be concerned about probate, trust settlement and other issues. Among those includes tax issues - both estate taxes and income taxes. On income taxes, the receipt of an inheritance is not income to the beneficiary. Our income tax system is based solely upon working for your income. An inheritance is not something that you worked for, so the receipt of an inheritance is not taxed to you as income.
One possible exception to this rule is the receipt of an IRA or an Annuity. Once monies are removed from an IRA or an annuity, there may be taxable consequences to the beneficiary as the assets have likely appreciated in value.
The likely tax return that an heir should be concerned with is the estate tax, but an estate tax only applies if the decedent's estate is worth more than $11.20 million (2018). Most people do not need to worry about this as most estates, by far, are below level.
If you want to learn more about probate and the probate process, feel free to download our Free Guide to Navigating the Florida Probate Process.
How can I avoid probate court proceedings in Florida?
Under Florida law, certain assets must go through probate court proceedings after an individual’s death. This is a way to keep track of all of the deceased person’s assets, pay any outstanding debts or taxes, and ensure that property is legally transferred to beneficiaries. The biggest drawbacks of the probate process are that it can take a long time for the beneficiaries to gain possession of assets due to a fairly cumbersome court process.
Some Assets Do Not Go Through Probate in Florida
It is our general opinion that good estate planning generally tries to avoid probate, although there are worse things than actually having assets go through probate. In our opinion, what is much worse than probate is having assets go to the wrong people or having heirs fight over assets upon your death. Compared to probate, having these two things happen can be much worse than the probate process!
In order to know what assets go through probate, you need to look to how each asset is held:
- Probate Assets. Probate assets in the decedent's own, individual name. These assets are distributed according to the decedent's last will and testament if they had one, and if not, then according to the Florida laws of intestacy (i.e., the decedent's family) if no will existed.
- Joint tenancy property. Property that is owned jointly by the deceased and someone else may be passed directly to the surviving owner under a law called the right of survivorship. This can be a house that is owned by a couple, or a joint bank account with two named owners. In order to avoid probate, the survivor must have his or her name listed on the joint tenancy property and no other beneficiaries are on the title.
- Should you add your children to your property? Generally, the answer is a NO! Adding children as co-owners of your property is frequently (but not always) a bad idea. Before you add a child to your assets, including your home, speak with your estate planning attorney first.
- Beneficiary-designated accounts. Florida law allows residents to add a payable-on-death designation to checking accounts, savings accounts, retirement accounts, certificates of deposit, and life insurance policies. As long as the deceased person has designated a beneficiary, the money in the account may be transferred to the named person without probate.
- Should I do this on all of my assets? Generally, this can be a mixed bag and very problematic in certain situations. With all of the assets having beneficiary designations, who is in charge of the funeral expenses? Who is in charge of the decedent's taxes? Hiring the accountant? Paying household bills? If nothing goes through probate, this may create huge problems! One advantage to having assets that go through probate, or assets being owned by a living trust, is that someone can be in charge of your assets and make sure your final expenses/taxes/costs can all be paid from one common pot of money before being distributed to beneficiaries. One misunderstood aspect of estate planning is that the executor ("personal representative" in Florida) is nominated by your last will and testament but appointed by the probate court. If no assets go through probate, no one is in charge of anything, which can be problematic with families that do not get along, for instance.
- Revocable Living Trusts. In Florida, assets that are held in a living trust may pass to beneficiaries without probate court proceedings. These trusts must be created before your death, and all assets—including real estate, antiques, vehicles, and so on—must be transferred into the trust under the terms of the trust document. You'll remain the trustee until your death, at which time your named successor will be in control of the assets in the trust. Generally speaking, trust planning is usually the best way to create your estate plan if you want to avoid probate upon your death.
- Enhanced Life Estate Deeds. Florida is one of the few states that allow enhanced life estate deeds, sometimes referred to as "Lady Bird deeds." These deeds allow residents to preserve their eligibility for Medicaid during their lifetimes while keeping valuable assets in the family. After death, the real property named in a Lady Bird deed passes automatically to beneficiaries without probate—meaning that assets cannot be taken by the state to recoup any Medicaid benefits used by the decedent.
- We sometimes use enhanced life estate deeds for simple estate matters and living trusts for more complicated matters. Basically, enhanced life estate deeds do not cover contingent beneficiaries very well. As an example, Mom creates an enhanced life estate deed transferring her home to her three children upon her death. If one of the children dies before Mom, that child's 1/3rd share would need to be probated. Living trusts cover contingencies while deeds simply do not.
Florida generally has two different types of probate - one is easy, one is much more complicated - and probate can take 5-8 months under most scenarios. Some estates won't need to go through formal probate at all. If a deceased person had no assets in their own, individual name, then no probate is required. If a person leaves behind few assets, beneficiaries may be able to go through a shortened version of probate known as summary administration. If the holdings of the estate aren't eligible for either of these simpler methods of administration, beneficiaries must go through formal probate. The key here is seeing a good probate attorney to direct you when the time comes.
Let Us Help With Your Estate Planning
The best way to protect your holdings and provide for your family members is to create a Florida estate plan tailored to your specific needs. Contact us today to speak to a member of our legal team about your ideas for the future.
What should I do first upon my loved one's death?
While you may already be doing this, you should take care of important family matters such as planning the funeral, visitation, obituary, family communications and more. This is always the most important priority.
You may also be dealing with the funeral home. At this time you will want them to help you obtain original death certificates for your loved one. We typically tell families to get four original short form death certificates and four original long form certificates. The short form death certificates do not have the cause of death – the long form death certificates are generally used with life insurance policies. If the assets are very simple or the estate very small, you may not need this many death certificates.
It generally takes about 10 days to get the death certificates from the funeral home. Typically, the original death certificate is necessary to get legal and financial matters started.
After you have the funeral and have obtained the death certificates, you can start with the financial aspects such as claiming life insurance policies, annuities, trust settlement and probate, when necessary.
If you want to learn more about probate, what probate is, and other legal aspects, you may want to download a free copy of Navigating the Florida Probate Process, our book written by attorney D. "Rep" DeLoach, III.
How Long Does the Probate Process Take in Florida?
The Florida probate process takes a different amount of time based upon the type of probate. There are two main types of probate in Florida: a formal probate administration and a summary probate administration. There is also a disposition without administration that is available in very limited circumstances.
The formal probate administration usually takes 6-9 months under most circumstances - start to finish. This process includes appointing a personal representative (i.e., the "executor"), a 90 days creditor's period that must run, payment of creditor's claims and more. One important distinction on probate is that the personal representative, once appointed by the probate court upon petition by an attorney, has the ability to manage and sell the estate assets. This means that while the probate process can take a number of months, the estate assets can be sold and managed effectively. Once the 90 day creditor's period runs (starting at the date of publication in a newspaper), the estate can generally start to be closed down with the personal representative following a strict process to close the estate.
The summary probate administration, usually reserved for small estates worth less than $75,000 that have no debt, can take less than a month under the right circumstances. In the summary administration, you need all of the beneficiaries to consent to the petition (under most circumstances). Once you have everyone's consent, once the summary petition to the court is submitted, the order of summary administration generally takes about 2-3 weeks (depending upon the county) to get back from the court. The order of summary administration will give the heirs access to the assets subject to the court order. An example of the court order is as follows:
Mom's last will and testament gave assets equally to the 2 children. Mom died without any debt (credit cards, medical bills, etc.). She owned a bank account with $20,000 and a life insurance policy of $8,000 that did not have a beneficiary. Upon petition to the probate court (typically done with an attorney), the court will grant the Order of Summary Administration. With the order, the bank and the life insurance company will release these funds equally to the three children.
If your loved one died with assets in their own, individual name, then they will likely need to seek an attorney to deal with the probate/process. We have a lot more information on the Florida probate process on our website. In the formal administration, you must have an attorney. In the summary administration, getting an attorney's assistance would be very, very helpful. Summary administrations can be complicated so an attorney's help would make things so much easier for families.
If your loved one passed away and someone is telling you that assets need to be probated, you may want to download our free book on Navigating the Florida Probate Process. This book will walk you through the Florida probate process, how to hire an attorney, if you need to hire an attorney, and other helpful hints.
Do I need to hire an attorney to probate assets in Florida?
Under most circumstances, you will need to hire an attorney to assist you in the probate process. First, you will know you have to probate an asset when it is in the decedent's own, individual name. This includes bank accounts, stocks, bonds, land and more. The family will not be able to take control of these assets without following the exact rules as set forth in the Florida Probate Code. We have more on probate assets here.
There are four main types of probate, some of which you will need an attorney:
- Formal Administration: This main probate process will definitely need an attorney. The process is described in greater detail below.
- Summary Administration: The family will likely need an attorney due to the complexity.
- Disposition without Administration: This process is designed to operate without probate.
- Ancillary Administration: This is either a summary or formal administration depending on the size and complexity.
To review, a Formal Administration definitely need an attorney while a simple summary administration should have an attorney due to the complexity. We have seen many people over the years try to go to court without an attorney and they just create problems and frustrations for themselves.
Also, the probate process is difficult and you will need a professional to help you. The following is a list of the general steps of a formal probate administration which can be quite complex, even to professionals. Not every estate will need every step, but this is a good outline for the entire formal probate process:
Step 1: Locate Original Will (when applicable); list probate assets and addresses of beneficiaries;
Step 2: Obtain original death certificate from funeral home;
Step 3: Find and hire a reputable probate attorney;
Step 4: Petition the probate court for appointment of Personal Representative;
Step 5: The probate court issues Letters of Administration and a bond for the Personal Representative;
Step 6: Send notice of administration to all heirs;
Step 7: Collect information from all heirs to administer the estate;
Step 8: All outstanding bills are collected, sometimes over a period of months;
Step 9: The Personal Representative publishes in a newspaper notice to creditors, and provides direct claims notices to any known creditor of decedent;
Step 10: Assets gathered and consolidated by the Personal Representative, typically placing the assets with the attorney’s office for accounting purposes;
Step 11: Assets inventoried within sixty (60) days of the appointment of Personal Representative;
Step 12: Determine if estate tax return is needed;
Step 13: Wait ninety (90) days for the published notice to creditors;
Step 14: Decide on the validity of any estate claims; dispute those that are invalid and pay those that are valid;
Step 15: File the Declaration of Homestead after the ninety (90) day creditors’ period runs;
Step 16: Gather receipts from creditors after paying valid claims;
Step 17: Defend/settle lawsuits from creditors who sue the estate;
Step 18: Sell/dispose of property, at Personal Representative’s discretion;
Step 19: Pay any specific bequests to beneficiaries, if money allows;
Step 20: Determine final distribution percentages;
Step 21: Calculate attorney’s fees;
Step 22: Calculate Personal Representative’s fee;
Step 23: Pay all outstanding estate costs;
Step 24: Account to the beneficiaries on all costs, outstanding bills, and fees;
Step 25: Either receive consent from beneficiaries or wait thirty (30) days after final accounting sent to the beneficiaries; and
Step 26: Petition to close estate and follow plan of distribution as submitted to heirs and the probate court.
As you can see, the probate process, with all of these required steps, can be quite cumbersome, although a good probate attorney would generally make the process relatively painless under most circumstances.
If you would like to know more about the Florida Probate process, please download our free book, Navigating the Florida Probate Process today.
Does a Last Will and Testament Avoid Probate in Florida?
Having a last will and testament in Florida does not ensure that your assets avoid probate upon your death. A last will and testament distributes your probate assets to the correct beneficiaries. Assets that are in the decedent's own, individual name are assets that go through probate in Florida. Your last will and testament tells where your probate assets are distributed upon your death. Florida has three types of probate:
- Formal Probate Administration
- When assets exceed $75,000 in value and/or debts exist
- Attorney definitely needed here
- Summary Probate Administration
- Assets less than $75,000 and there are no debts
- Attorney advised but not completely necessary
- Disposition without Administration
- For very small estates in order to pay back someone who paid for a funeral bill, typically
In creating your estate plan, you need to know where your probate and non-probate assets are distributed upon your death. Non-probate assets include jointly held property (land, bank accounts) or assets with beneficiary designations with payable on death designations (life insurance, annuities IRAs). These assets are not distributed according to your last will and testament but are instead distributed according to the beneficiaries thereon. This means that the last will and testament does not control these assets, which can lead to unintentional consequences with unplanned estates. As an example:
Mom has a falling out with her daughter and wants to disinherit her. Mother changes her last will and testament with her attorney so that daughter is disinherited. Mother does not change the beneficiary of her individual retirement account (IRA) which still names the daughter as a beneficiary. Upon mother's death, while her probate estate may not go to her daughter, the IRA will. The reason is that the last will and testament did not effect the IRA beneficiary designation.
If you want to learn more about probate, please see the following:
- Formal Probate Administration
What Is Probate in Florida?
Probate is the legal process of settling the estate of a deceased person and, more specifically, distributing the decedent's probate property to the rightful heirs. The probate process generally involves assets in the decedent’s probate estate, which includes only those assets in the decedent’s own, individual name. The probate process does not generally include assets that are jointly held with rights of survivorship and other assets distributed by contract such as life insurance, IRAs and 401Ks. These are distributed to the survivor or to the designated beneficiary without the estate’s involvement.
An example of probate and non-probate assets is as follows:
Mother, Mary, passes away owning the following assets:
- Stocks certificates titled in her name
- Rental property titled in her own name
- Bank account jointly owned with her daughter
- IRA with beneficiary designation to her daughter
In our example, the probate process only includes the rental property and the stocks because these are the only assets that are owned by the “probate estate.” This means that the heirs must hire an attorney to assist only with these two assets. The bank account would now be owned by the daughter as the survivor and the IRA is distributed directly to the daughter as well, avoiding the probate process and, ultimately, avoiding attorneys.
The probate court has jurisdiction only over the decedent's probate estate. The probate court’s job is to make sure the probate estate is settled in accordance with Florida law. The probate process generally has the following goals:
- Make sure the decedent’s creditors have the opportunity to be paid;
- Make sure the decedent’s taxes are paid;
- Make sure the probate assets are correctly distributed to the beneficiaries; and
- Make sure the decedent’s affairs are properly settled.
Most people would agree that the probate process itself has good goals. Most believe, for instance, that a decedent’s creditors should get paid before their heirs receive their money.
As the probate process is a legal process, an attorney will need to be hired to help go to court to properly follow the correct procedure.