Probate
Probate is the legal process used to transfer legal ownership of property from a deceased person to that person’s beneficiaries and to resolve the deceased person’s debts. If the person had a will, it should be submitted to the court during probate so the court can resolve any disputes about its validity. Regardless of whether the deceased person had a will, the court will also determine how the deceased person’s assets should be distributed after all debts are settled.
Depending on the type of probate, a personal representative may need to be appointed by the court. The personal representative is a fiduciary who, acting in the best interest of interested persons—beneficiaries as well as creditors—is tasked with settling the estate’s debts and distributing the estate’s assets. This is someone who may be nominated in the deceased person’s will, but if there is no such nomination (as when someone dies without a will), Florida law determines the order of preference and the general requirements that must be met for someone to serve.
Probate can be wrapped up fairly quickly for very simple estates but can also drag on for years for large estates with complex assets, such as businesses, or if there are tax issues, or if the will is contested or beneficiaries cannot be identified or located.
Whether probate is necessary will depend on a number of factors, such as whether the person held property solely in their own name and whether all of their accounts (such as bank, brokerage, and retirement accounts) had beneficiary designations (often called pay on death—POD—or transfer on death—TOD—designations). If a person held all of their property jointly with another person, had designated beneficiaries, and/or all of their property was held in trust, their property may transfer to their beneficiaries as a matter of law and probate may not be necessary. But if even one account or piece of property was forgotten about or not eligible for such designations, probate may still be necessary to make sure that the property legally transfers to the beneficiaries or heirs.
Forms of Probate
Summary Administration
Summary administration can be used when the total value of the probate estate is not more than $75,000 or the decedent passed away more than two years before probate is opened. The $75,000 limit only includes property that has to go through probate and does not include homestead property, other exempt property, and accounts or life insurance policies with beneficiary designations.
Summary administration is generally much quicker and less expensive than formal administration because the court does not usually appoint a personal representative and there is no requirement to post a public notice to creditors. However, if summary administration is opened and creditors are known, whoever opens probate has a duty to inform the creditors and resolve the decedent’s debts. Additionally, even if you truly did not know about any creditors at the time you open probate, if any come out of the woodwork during the two-year window, whoever inherited property from the estate will be liable to settle the debts from their inheritance.
Formal Administration
Formal administration is generally longer and more expensive but has some advantages over summary administration. This form of administration requires the court to appoint a personal representative to handle the estate’s matters, including collecting and inventorying all of the decedent’s assets and dealing with creditors and beneficiaries. The personal representative can also handle lawsuits that involve the estate. Formal administration requires the personal representative to publish a notice to creditors, which gives unknown creditors 3 months from the date of first publication to file a claim against the estate. Any claim not filed within the timeframe is barred. So, even if the decedent owed a business $20,000, if the business was an unknown creditor and did not file a claim within the 3-month period, it does not matter how legitimate the debt was, the estate does not have to pay it. So, while formal administration may take longer and cost more, it drastically cuts down the creditor window and generally brings finality to the estate more quickly.
Still have questions about probate in Florida? Visit our Probate FAQ or click below to schedule a free consultation with a Gainesville probate attorney today.
Want to learn how you can create an estate plan that avoids probate altogether? Read about non-probate transfers.
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Michael Merhar is a Gainesville probate attorney helping people throughout Florida navigate the probate process. If you need help from a Florida probate attorney, please schedule a free consultation.