End of life planning might not be a topic most people are eager to discuss, but it’s an essential one if you want to have control over who inherits your money and possessions.
At Addition Financial, we talk to members every day about things like estate planning and Florida probate rules because we consider it our responsibility to ensure that our members have the information and tools they need to get their finances in order.
Probate laws can be confusing. To help you out, here are eight critical Florida probate rules you should know as you work on your will and end of life planning.
#1: Every Estate Requires a Personal Representative
In the state of Florida, the terms executor, executrix, administrator or administratrix are not used in probate. Instead, the estate must have a personal representative.
The personal representative may be an individual, bank or trust, provided they meet certain conditions. The conditions are that they must be either:
- A resident of Florida; or
- A close relative of the deceased, such as a spouse, sibling, parent or child.
When you write a will, you may nominate a person to be the personal representative for your estate. However, a judge will still need to approve the appointment to ensure that the person nominated is able to carry out the responsibilities associated with the job.
The duties of the personal representative include identifying estate assets, paying taxes and distributing assets according to the wishes of the deceased or the decision of the probate court.
#2: In Most Cases, You Will Need to Hire an Attorney
In some states, you won’t be required to hire an attorney to handle probate. However, in Florida, an attorney is necessary and required except in a few limited circumstances.
You may not need to hire an attorney if:
- The estate is small enough to qualify for disposition without administration
- There is a sole beneficiary to the estate and that person is also the personal representative
Even if you aren’t required to hire an attorney, you may want to do so. Florida’s probate laws are complex and may be confusing for any personal representative who doesn’t also have legal training. Small estates are unlikely to require a lot of legal advice but it may still be worthwhile to hire a lawyer to prevent confusion and avoid mistakes.
#3: Most Assets Are Required to Go Through Probate
In some states, only large estates are required to go through probate, but that’s not the case in Florida. In fact, it’s easier for us to list the assets that aren’t required to go through probate than to list those that are:
- Assets that are held in a living trust (also known as a revocable trust) do not need to go through probate.
- Property that is co-owned in a joint tenancy does not need to go through probate.
- In some cases, life insurance policies and retirement accounts may be exempt from probate. The most common reason is when the decedent named a beneficiary for the account.
A joint tenancy exists if an account or asset automatically transfers to the co-owner upon the other owner’s death. However, if there is no joint tenancy than the account or asset will need to go through probate.
#4: Summary Administration May Be an Option
While many estates in Florida are subject to formal probate, in some cases, summary administration may be an option. For small and uncomplicated estates, a summary administration may be both quicker and less expensive than the formal option.
An estate can qualify for summary administration if:
- The value of the estate (less property that is exempt from creditors’ claims, such as homestead real property) is $75,000 or less; and
- If the deceased person’s debts have either already been paid or if the creditors do not object to summary administration; or
- If the decedent has been dead for more than two years and there has not been any prior administration.
If you do qualify for summary administration, it’s important to note that anybody who receives the estate assets will remain liable for claims made against the decedent for two years after the decedent’s death. In other words, there are some risks involved, but if all creditors agree to summary administration, the risk is low.
#5: Administration May Not Be Required
Another alternative to formal administration in the state of Florida is something called “Disposition without Administration,” an exception that applies in a few specific circumstances.
The first exception applies if the probate estate assets include only property that is classified as exempt from claims by creditors under applicable law. The second exception is if the estate consists only of non-exempt personal property, the value of which must not exceed:
- The total amount of preferred funeral expenses; and
- The total amount of all reasonable & necessary hospital and medical expenses incurred in the last 60 days of the decedent’s life/illness, if applicable.
Clearly, this option applies only to small estates with few assets. An estate lawyer can help you determine which administration option is likely to be required for your estate. As noted above, estates where the decedent has been dead for two years or more also qualify for disposition without administration.
#6: Beneficiaries and Other Interested Parties May Object to Probate
As we stated above, it is the job of the personal administrator for the estate to identify assets, pay the decedent’s debts and distribute bequests and assets to the decedent’s survivors and beneficiaries. They must submit an accounting of their activities to the probate court.
When the personal administrator appears in court to present their activities, any other interested party has the right to appear as well and object to the findings of the probate court. As you might expect, objections have the potential to slow down the probate process and delay payment of bequests.
The fact that objections are possible illustrates why it’s a good idea to have an attorney to represent you during probate. Given the complexity of Florida’s probate rules, you may need legal assistance to help you respond to potential challenges and objections.
#7: The Rules Change When Someone Dies Without a Will
One of the most important things to know about Florida’s estate and probate laws is that the rules are different when a person dies without leaving a will, which is also known as dying intestate (without a testament).
Some of the key things you should know about dying intestate are as follows:
- If the deceased person has a surviving spouse and no living children, grandchildren or parents, the spouse receives the whole estate.
- If the deceased person has a spouse and living family members who are family members of their spouse (children) the spouse receives the entire estate.
- If the spouse has living family members who aren’t immediate family members of the deceased, the spouse receives half of the estate and the other half goes to the spouse’s descendants.
- If the deceased person was not married, the estate goes to immediate family members and will be divided in accordance with Florida probate laws.
- If the deceased person was unmarried and had no living immediate family members, the estate goes to surviving parents of the deceased.
When a person dies without any close family members as identified under Florida law, it becomes the job of the state of Florida to search for remote heirs. It is important to note here that, for the purposes of inheritance and probate, adopted children are considered to be immediate family members. However, separate rules apply for children born out of wedlock.
#8: Probate Can Take Between 6 and 12 Months
One of the most common questions we hear about estate planning and probate is about how long probate takes. As you might expect, there is no “one size fits all” response to that question because the length of probate depends on many factors, including:
- The size of the estate
- The complexity of the estate
- The overall financial picture of the deceased (estates with many or large debts take longer to go through probate than estates where the deceased has no debts)
- The existence of a will
- The availability of heirs
For obvious reasons, estates where heirs must be identified and located, or where there are objections to the probate process, will take longer than simple estates where a will is present and there are no disputes about the dispensation of the decedent’s assets.
That said, the average length of probate in Florida is between 6 and 12 months. Some probates may take only a few months while others may drag out. You can minimize the risk of a drawn-out probate by hiring an attorney to represent you.
Florida probate rules can be difficult to understand and confusion can cause delays in the probate process. For that reason, we recommend engaging the services of an experienced attorney who can walk you through the process and help you to navigate any complications that arise.
Do you need help planning for retirement and preparing your estate? The experienced financial advisors at Addition Financial can help. Click here to make an appointment now.
