Probate/Estate Administration

Probate is the court supervised process for identifying the assets of a deceased person’s (decedent’s) estate, paying the decedent’s debts and distributing the assets of the estate to the decedent’s beneficiaries. Probate is a necessary step under Florida law to pass the ownership of the estate’s assets to the decedent’s beneficiaries.

Home Town Law, P.A. assists clients with the opening of a probate action, with the subsequent appointment of a personal representative of an estate and then continues to guide the personal representative in carrying out his or her legal duties to beneficiaries, creditors, and taxing authorities.

An estate administration in Florida is a process. There are certain steps that must be taken at a particular time. It is a statute driven process which is briefly explained below. Please note that the information provided below is a condensed summary of the overall probate process in formal administration.

To formally open the probate estate, a Petition for Administration is required to be filed with the probate court. The Petition will need to specify whether the decedent had a Will or not.

Along with the Petition for Administration, the decedent’s last will (in a testate administration) must also be filed along with a certified copy of the death certificate. A certified copy of the death certificate must also be filed in the public records of any other county where the decedent owned real property.

To expedite the estate administration heirs/beneficiaries may sign a Consent and Waiver form. When a Consent and Waiver form is signed, a personal representative is appointed without any hearings. Otherwise, the heirs/beneficiaries must be served with the Petition for Administration and the Will (in a testate administration) by certified mail and have a hearing on the appointment of the personal representative. Also, though each heir/beneficiary, including the surviving spouse, and any other interested person is entitled to receive a copy of the Notice of Administration, such heir/beneficiary and/or interested person may waive the service of this notice in a writing to expedite the estate administration.

The personal representative must also execute an oath confirming that the individual who is applying to become the personal representative of the estate is qualified to serve as the personal representative (is over eighteen years of age, a relative of the decedent or a Florida resident, has no felony convictions). The oath of personal representative also designates the estate’s attorney as the resident agent for service of process in the event that a suit is filed against the estate.

After the judge reviews the will (in a testate administration), the Petition for Administration, the death certificate, and the Oath of Witness to Will (if the will or codicil is not self-proving), he or she will enter the Order Admitting Will to Probate. This gives judicial approval to the will and authorizes the Personal Representative to administer the estate according to the terms of the will.

The probate court will also issue the Letters of Administration. This document provides official proof that the personal representative is entitled to act for the estate, including the ability to gather any assets and settle creditor claims. The Letters of Administration will be needed to transfer bank accounts, stocks and other assets.

Once appointed, the Florida personal representative can begin gathering and preserving the decedent’s assets subject to probate administration for later distribution to the designated heirs/beneficiaries.

As part of the estate administration, the personal representative must publish a Notice to Creditors for unknown estate creditors and mail a notice to known creditors. Creditors must then file a claim within three months of the date the notice is published, but no less than thirty days if they receive a copy by mail. This process helps determine which creditors should be paid, and who should be paid first. The Florida Probate Code provides an order of priority in the payment of the estate debt. For any creditors who file a claim, the personal representative must obtain a release in the proper form for filing with the court before the estate can be closed.

The Notice to Creditors must also be served upon Florida Health Management Systems, pursuant to the Florida Medicaid recovery program. The personal representative must serve the notice by certified mail, and file proof of service with the court.

Within sixty days of the appointment of the personal representative, the estate must file an inventory that lists the probate assets. This will only include assets that require a court order to pass to the heirs/beneficiaries. For the personal effects, a good estimate should be made, and in many cases, an appraisal obtained. The “date of death value” is the figure that should be used for each item on the inventory. A copy of the completed inventory must be served on the Florida Department of Revenue and each of the heirs.

The court must have proof of payment of any taxes due, or proof that a return is not required. If no estate tax is due, the personal representative should file an Affidavit of No Estate Tax Due. Also, the personal representative should file the income Tax return (1040) for the year of death. For convenience, the personal representative should consult the decedent’s tax preparer, if there was one, or use their own tax consultant. In most cases, the estate will also be required to file an income tax return (form 1041).

Once all valid creditor claims have been paid, the estate can be closed. When all of the estate assets have been distributed, and creditors paid, the attorney for the personal representative will prepare a Petition for Discharge and additional waivers for the heirs/beneficiaries to sign.

Florida Homestead

The Florida Constitution contains protections for the surviving family members of a decedent who owned real property in the decedent’s name alone. If the will, or the law for estates without wills, results in a family member inheriting the decedent’s primary residence, the home passes to the beneficiary without being subject to the decedent’s creditor claims.

Since the ownership passes at the moment of death, and therefore, the beneficiaries are the owners immediately, the Florida personal representative should not use estate assets to pay for the maintenance of the home. If expenses such as insurance, mortgage payments and utilities are paid, arrangements should be made by the person or persons inheriting the home to pay these from their own funds.

When the decedent is only survived by his adult children, then to remove the homestead property from the probate proceeding, the personal representative must file the Petition to Determine Homestead Status of Real Property. When the Court enters an Order Determining Homestead Status of Real Property the property to be a protected homestead no longer becomes a concern of the probate court and is then protected from unsecured creditors. The Order Determining Homestead usually cannot be obtained until after the three month creditor claim period expires and confirms that the property was in fact the decedent’s Homestead as defined under the probate laws.

Finally, the Florida statutes provide a schedule of attorney fees based upon the Inventory value of the estate, together with any income earned by the estate while it is open. The statutes provide fees that are presumed to be reasonable for ordinary services in administering an estate. Furthermore, Florida Statutes also address “extraordinary” fees for services such as those relating to preparation of a federal estate tax return, homestead real property, will contests, contested claims, elective share proceedings, tax advice on post-death tax matters, purchase or sale of property, fee disputes and ancillary administration issues.

The Florida statutes also provide that the personal representative is entitled to 3% of the Probate inventory value and is also entitled to be reimbursed for out-of-pocket expenses. Quite often the applicant personal representative has to use his/her own funds to hire a probate attorney, for funeral/burial expenses, to pay for the death certificates, for an obituary, etc. These are legitimate expenses that the personal representative may recover by filing a Personal Representative’s Proof of Claim for costs and expenses paid and when the requisite time within which to object to such a claim passes, reimbursement may occur.

Again, this is just a summary of some of the steps that must be undertaken to properly administer an estate in Florida and by no means is an all-inclusive list.

Home Town Law, P.A. assists clients with all stages of a probate process regardless of the type of probate proceeding that must be instituted. In Florida, there are several types of probate proceedings. There is formal administration, summary administration, ancillary administration and disposition without administration.