What You Need to Know About Probate

A Probate Primer Before You Choose Your Probate Attorney

Information provided by Attorney Bonnie Klein Rhoden; She practices in the areas of Probate, Estate Planning, Guardianship, Wills/Trusts, Family Law, and associated areas of the law.

What IS Probate and What Do I Need To Know About Probate?

Probate is a formal, legal process that identifies a decedent’s assets and debts, ensures the creditors are paid (if possible) including the IRS, and distributing the remaining assets to the persons entitled to receive the assets. Probate here in Florida is governed by ‘Florida Probate Code’ found in the Florida Statues Chapter 731 through Chapter 735.

You have three types of probate administration to choose from in Florida, as follows:

Formal Administration: the most thorough process but also the longest and usually with the highest cost and most reliable outcome;
Summary Administration: a shortened form for estates valued less than $75,000 and with little to no unpaid debt; and
A specialty process known as “Disposition of Personal Property Without Administration.”

Why Is Probate Necessary To Handle My Affairs?

Probate is needed in order to move the assets of the decedent to the persons who should receive them. It is a court supervised process to address your bills, your assets, your beneficiaries, and other issues that present after death.

What Is A Last Will And Testament?

This document is commonly referred to as a “Will” or a “Last Will”. Typically a will can be described as a written declaration of a person, created during their lifetime, executed by signature with two witnesses and a notary during a period of testamentary capacity. Here in Florida the legislature requires specific terms of execution – the testator must sign the will in the presence of two (2) witnesses and a notary public. The testator must also execute a Self Proof Affidavit before the same two witnesses and a notary public.

Typically a Last Will contains provisions about the payment of final expenses, the directions for distribution of assets, an appointment of a Personal Representative, and other directions from the testator for post-death activities on behalf of the Estate.

A Last Will has an important role in the Probate process. It must be filed by the person who discovers the will document within ten days of it’s discovery. File the Will document with the Clerk of Court where the decedent resided (not where they passed away.) You will receive a Receipt of Safekeeping from the Clerk’s office and the original will shall be retained in the Clerk’s records from that point forward.

What Are The Assets That Are Included In a Probate Matter?

Any asset has the potential to be included in a probate matter. Your attorney does not have an easy answer to this question however you can presume several general categories of assets. Those general categories include: assets held in the decedent’s individual name upon his/her death (not joint accounts) or those that are held by the decedent without a provision for transfer by operation of law (automatically upon death to a beneficiary). Here are some examples to help you understand this principle:

If a decedent holds an account at a bank in his/her SOLE name it is a probate asset. However, an account at the same bank held “ITF” or In Trust For Little Jimmy Joe it is NOT a probate asset. A account held in joint names with the decedent and his/her spouse, child, or any other person with rights of survivorship (if you see the abbreviation “JTWROS” it means ‘Joint With Right Of Survivorship’) is NOT a probate asset.

Remember: The spouse of a decedent has a right to the Spousal Elective Share and some “non-probate” assets are used to calculate the value of the estate for purposes of determining a spousal share.

If the decedent leaves a life insurance policy, any type of annuity account, or any type of individual retirement account (IRA) payable upon death to a particular beneficiary is not part of the probate estate however a decedent may leave his or her “estate” as the beneficiary of an annuity, IRA, or life insurance policy and therefore those assets are included in the probate estate.
If a married couple own property together as ‘tenants by the entirety’ that house or land passes directly to the surviving spouse outside the probate estate. (It is important to remember that the surviving spouse must make arrangements for that same property upon his/her own death because they will own that property as a “sole owner” and it will flow into his/her probate assets.)
If there is other, non-homestead, real property that is held in the name of the decedent alone such as a rental home, a timeshare, vacant land, commercial property, or a hunting camp it IS a probate asset. If those properties are owned with another person or group WITH full right of survivorship those assets will pass to the probate estate. Propery held as ‘tenants by the entirety’ are NOT part of the probate estate.

Of course this is not an exhaustive list, rather it is intended to give examples of property that is included or excluded from the probate estate.

How Does Probate Proceed If There Is No Will?

Not everyone creates a Will. I usually tell people if they don’t write their own Will, don’t worry because the State of Florida wrote one for you! Usually my clients are not satisfied with what Florida forces your estate to do with your assets. Here is a general explanation of Florida’s laws of intestacy (intestate means a person died without a Will):

If the decedent has a surviving spouse and has no “issue” (children) or lineal descendants that spouse receives the entire estate.
If the decedent has a surviving spouse and also has “issue” or lineal descendants there are several options depending on the exact situation, as follows:
If there is a surviving spouse and that spouse shares at least one lineal descendent with the decedent (and the decedent has no other lineal descendants) the surviving spouse gets the first sixty thousand dollars ($60,000) of the Probate Estate AND 50% of all the rest of the probate estate. The lineal descendants, who are all shared between the decedent and surviving spouse, equally share the other 50%.
If there is a surviving spouse and at least one lineal descendent of the decedent that is NOT also descended from the surviving spouse the surviving spouse gets 50% of the probate estate and the lineal descendants share the other 50%.
If there is not a Surviving Spouse and there ARE lineal descendants the direct children share the estate equally – any deceased child’s share is divided among his/her children.
If there is no Surviving Spouse and NO lineal descendants the legislature made provisions to look to the parents of the decedent or if none, to the siblings of the decedent. There are more steps available if no parents or siblings survive the decedent and can be found in Florida Statute 732 of the Probate Code.
There are always exceptions in the law, aren’t there? Probate is no exception to that exception! The generalities describe in (a) through (d) are subject to the probate rules for homestead property (a decedent’s home, domicile or property of regular residence), personal property exemptions, and spousal living allowance.

* Regarding the decedent’s homestead, if held in the decedent’s name only, the surviving spouse can either take a life estate in that homestead and the children receive the remainder (they take the property upon surviving spouse’s death). The surviving spouse may also choose to become 50% owner of the homestead with the children sharing the other 50% ownership share.

Who Are The Players In Probate? Who Is Involved?

There are many different people that may have a role in your probate matter. This is a partial list of potential players:

Clerks in the Office of the Clerk of Court (receives & manages filings)
Circuit Court Judge (presides over the process)
CPA or Tax Advisor (to advise the PR on the decedent’s tax load)
Personal Representative (appointed to complete tasks of administration)
Attorney for the PR (required representation for Formal Probate – does the heavy lifting for the Probate process)
USPS (providing notice to beneficiaries and creditors is typically done by Certified USPS Mail)
Creditors (claiming against the estate for payment of the decedent’s debts)
Internal Revenue Service (IRS) (aren’t they always involved?!)
Florida Department of Revenue (needs to be notified in certain probate matters)
Charitable organizations (many people include provisions for charitable giving upon their death)
Family Members and Other Beneficiaries (who is getting what?)
Adversarial parties (sometimes there are arguments about the will, who is getting what, and how the estate is being handled)
Trustee(s) (if the decedent created a trust during life or if his/her will created a testamentary trust this person will play an important role)

How Do I Begin Probate? Where Do I File My Papers?

Probate usually starts by meeting with and retaining an attorney. You can expect that an initial deposit of about $2,000 will be needed to cover the hard costs of your probate matter. After that a Petition for Administration is necessary along with other legal documents to be prepared. Your probate case is filed with the clreks at the Clerk of Court’s office. Most law firms handle these filings using the State of Florida E-Filing Portal. There is a filing fee to the clerk to open the probate matter.

Who Is Responsible for the Probate Process? Who’s The Boss of Probate?

Refer back to the list of players in a probate case but the person who is in absolute control is the Circuit Judge assigned to the case. The Judge decides who will serve as the Personal Representative, if a property is going to receive Homestead protection, and decide any disputed issues. The Personal Representative is given an Order by the Judge (called “Letters of Administration”) which give the PR authority to work on behalf of the estate such as open a bank account, access properties, gather assets, and complete taxes. The PR also has the authority to request medical records of the decedent. The PR’s attorney also has an important role in keeping the process on track, preparing and filing the proper documents as well as keeping the PR focused and on track. The ultimate answer to the question is that the Judge is the Boss!

What Is The Personal Representative? What Are His/Her Duties?

Being your personal representative is an important role and you should choose this person carefully. Your PR is appointed by you in your Last Will and ultimately granted authority to act by the Probate Judge. Some of you will also have a Trust document requiring a trustee which is a similar role to a PR but we will leave the Trust Talk for another article and concentrate on what you need to consider for a Personal Representative.

In past years we knew the role of PR as an Executor or Executrix, now in Florida we use the gender neutral, politically correct term “Personal Representative” or “PR”. Your Last Will and Testament will do many things for you including make an appointment of a primary PR and hopefully, if your estate lawyer helped you plan well, at least one Successor PR. I insist my clients choose at least one successor PR and strongly suggest two successor PR appointments in the will.

The PR is a fiduciary to your estate meaning he/she is in a confidential relationship with your estate and must act properly, promptly, and in a trustworthy manner. He/she will be responsible for retaining the attorney to handle the legal probate process (unless you choose one and list in your will), for accessing your home to assemble your assets, for contacting life insurance companies and financial firms and other professionals to ascertain where and how your assets are held. This person will interface with your family and other beneficiaries and depending how you prepared your will he/she may also make your final arrangements, receive your cremains, or arrange payment to the church or funeral home. Decisions about whether to liquidate assets or not can have a long reaching effect upon your estate’s tax load – the PR makes those decisions if you do not dictated instructions about this task in your Will document.

Who Can Be The Personal Representative of My Probate Estate?

Here’s a list of ideas, it is not all inclusive but rather just enough to get you thinking. (Remember most PRs will work with your Probate Attorney so legal knowledge is not necessarily required.)

Your spouse
Your brother or sister or brother in law/sister in law
Your accountant (ask before you appoint as many professionals decline to serve after your passing)
Your lawyer or another lawyer you choose (probate attorney or tax attorney are good choices)
A bank (this can be a pricey choice)
A trust company or professional trustee (also pricey but some estates require a person with specialized knowledge)
Your child or children
Your best friend or clergy (again, ask before listing the names in your will)

Probate for the PR in a Nutshell

Choose your estate probate attorney, pay the opening retainer (usually around ($2,000).
Identify your assets, assemble them and ensure they are safeguarded (such as your home, other property, a boat, or cash type assets)
Identify your debts and creditors – these people and companies must be notified of your Probate Estate pursuant to Florida Statutes.
Open the Probate Matter with the circuit court (the probate lawyer does the heavy lifting but your PR must sign quite a few documents and take an Oath of Personal Representative).
Provide all the beneficiaries and potential beneficiaries a “Notice of Administration” by certified mail.
Arrange with the lawyer to prepare a “Notice to Creditors” and publish the required formats in a local newspaper to give proper notice to unknown creditors.
Arrange to prepare and file the decedent’s tax return(s). And make the payment from the probate estate.
Distribute the assets.
Close the legal probate administration process when all tasks are complete.

What Is This About ‘Preference’ To Be The Personal Representative?

If you list persons in your will, and your will is valid, the person nominated in that will has preference to be appointed by the judge. If a person does not wish to serve he/she may decline appointment.

But what happens if you don’t have a will or don’t list your choices for PR? The Florida Statutes help by deciding for you. Your PR will be your surviving spouse if you have one – that person has top priority to serve as PR. If you have no surviving spouse priority to serve goes to the person chosen by a majority of beneficiaries to the estate.

Remember: Creditors may open probate on your estate if your spouse, family or other appointed person does not open the matter soon enough after your passing.

Why Will My PR Be Required To Hire An Attorney?

If you recall earlier in this article we discussed the different types of probate. Here in Florida ‘Formal Probate’ is the process in which a PR is appointed. This type of probate statutorily requires an attorney. For those estates that can be administered with Summary Probate an attorney is not required.

What Happens To My Unpaid Bills When I Die?

Your spouse or beneficiaries should not pay any bills in your name after your passing. There is a specific process in probate regarding amounts you may owe creditors. In simplest terms the creditors must properly file a caveat or claim against the estate and if it is valid it will be paid from any funds available. If the claim is objected to by the estate it is possible the creditor’s claim will be barred and therefore will not have to be paid.

Your personal representative is required by statute to conduct a reasonable diligent search to find and provide notice to your creditors.

What Role Does the IRS Play In My Probate Estate?

With regard to federal income tax your death brings about two events: 1) It terminates your final tax year for the filing of a Federal Personal Tax Return and 2) It creates your “Estate” which is a taxable entity in and of itself (the Estate does not begin when Probate is filed, rather it begins upon your death).

Your PR may have to file a number of forms/returns to the IRS on your behalf and that of your Estate. Here are a few of the commonly used IRS filings relating to probate:

Your final 1040 income tax return with which your PR reports all the income for the final year of your life.
A 1041 income tax return for the estate itself. This reports any income earned by the Estate entity.
A gift tax return is done with form 709 and is used to report gifts made by you prior to your death.
If your estate is quite sizable or complicated your PR may have to file a 706 Estate Tax Return to report the estate income and deductions.

How Does Florida’s Department of Revenue (DOR) Get Involved In My Probate Matter?

Your PR will provide a copy of the Inventory of your assets to the DOR as required by Florida law. Usually the attorney will take care of preparing and mailing this item.

For those persons deceased January 1, 2000 and after and who also have no federal estate tax return required they may prepare and record, through the Clerk of Court to ‘public records’ and the court probate file, a standard document called, “Affidavit of No Florida Estate Tax Due.” If there is a federal tax return due the estate will have to prepare and file a FLORIDA Estate Tax Return (this is form # F 706), which goes to the DOR.

The Inventory document that is sent to the DOR relates to potential intangible taxes in Florida. DOR will review the Inventory information and make a determination if the probate estate (or the decedent, during his/her life) should have filed an intangible tax return and pay the associated taxes. DOR will inform the PR through the probate lawyer if this applies to your estate.

The PR should refer to the estate tax advisor to ensure more complex estate tax matters are properly addressed such as the Department of Revenue receiving all or part of the “state death tax credit” as allowed under the IRS rules. If an estate is required to complete a Florida ‘estate tax return’ the estate will need from the DOR a certificate of non tax or a tax receipt so real property in the state can receive clear title. Formal probate cannot be closed without this step.

What Are My Surviving Spouse And Children Entitled To From My Probate Estate?

In Florida there are protections for your spouse and some of your issue or children. Your surviving spouse may be able to make a claim for your marital residence as a homestead property, may be able to receive a family allowance, and file for spousal elective share. If you have a pre-nuptial, post-nuptial, or other marital agreement with your spouse that document may prevent him/her from making spousal claims. Other rights that vest in your children may include: homestead rights, ‘pretermitted child’ rights, family allowance rights, and other exempt property rights. Your probate attorney will be able to guide your PR through these rights.

May I Exclude Beneficiaries From Inheriting My Assets?

Yes! In Florida the law allows you to exclude persons from taking under your estate. You may entirely “disinherit” certain persons by stating same in your Last Will.

How Long Should I Expect To Have A Probate Matter Open?

This is closely tied to the information provided in the IRS question above. Those estates required to file a Federal Tax Return can be closed only after the returns are completed and filed. This can be 12 to 36 months depending upon the size of the Estate (these estates would have to use Formal Probate). Other, simpler, formal probate estates can be completed in as little as 10 months but do not expect that your matter will be on the low end of the scale. Summary Probate, if your estate qualifies, can be completed in as little as 3 months depending upon the filings and the court schedule. It is possible that more complex estates may be open in the court system for several years.

Who Pays for Probate? How Much Is It Going To Cost?

Florida law has statutes in place that govern the payments to various professionals working for the probate estate.

Fees to the Personal Representative may depend on a number of factors:

The testator dictates the amount in the will
A contract between testator and Personal Representative (executed during the testator’s life)
An Agreement between the beneficiaries and creditors (if any exist)
According to Florida Statutes if the fee amount is without objections
By a Judge if the parties can not agree

The amount of fees to the PR’s attorney is figured by :

Agreement between the attorney, the PR, and the beneficiaries
According to Florida Statutes if the fee amount is without objections
By a Judge if the parties can not agree

Can I Exclude My Spouse From My Will Or Trust?

No! Not within the will or trust documents; here in Florida you need some type of a marital agreement to avoid the spousal elective share which is approximately 30% of the estate assets along with homestead rights, exempt property, and family allowance. This is a bit of a tricky area of the law so consult your probate attorney with questions about spousal rights to claim against your estate.

The attorneys of Rhoden Law Group have been serving this area for over 35 years combined. Call us with your questions or for a free consultation with Attorney Bonnie Klein Rhoden, use the Contact form to email the office, or call/text the office at 321-549-3162.