Understanding Probate in Florida

Probate is a court-supervised process for identifying and marshaling a deceased person’s (decedent’s) assets, settling the decedent’s financial affairs after his or her death, and distributing the decedent’s assets to his/her beneficiaries.

Florida has established three types of probate administrations to settle a Florida estate:

1. Disposition without administration
2. Summary administration
3. Formal administration.

The type of administration that a probate estate qualifies for is determined by the:

• value of the decedent’s estate
• the length of time since the decedent’s death
• in the case of disposition without administration, the type of assets that make up the estate.

The first step in probate administration is to determine which of the decedent’s assets are subject to probate administration and determine the value of the probate estate to see which estate administration a decedent’s estate can utilize.

In general, estate assets that are subject to probate are those assets that are:

• owned in an individual name
• assets that are owned jointly with others as tenants in common
• assets that have a beneficiary designation where the decedent’s estate was named the beneficiary, or, no beneficiary designation was made at all.

Generally, assets that are not subject to probate administration are those assets that are owned jointly with others with right of survivorship such as:

• any asset with a beneficiary designation when a third person is named the beneficiary
• assets titled in a Revocable Living Trust (NOTE: living trust assets may be subject to probate creditors)
• beneficial interests in property, such as a life estate in real property or an income interest in a third party trust, and homestead real property.

Once you have a general idea of the assets that are subject to probate administration and which assets are not, the next step is to determine which form of administration an estate can utilize.

Disposition without Administration:

A probate estate qualifies for Disposition without Administration where the decedent leaves only exempt personal property as defined under the Florida Statutes, and/or personal property exempt from the claims of creditors under the Constitution of Florida and/or nonexempt personal property the value of which does not exceed the sum of the amount of “preferred funeral expenses” and reasonable and necessary medical and hospital expenses of the last 60 days of the last illness. Preferred funeral expenses are currently set at $6,000.00.

If an estate qualifies for this form of administration, then an interested party can simply go to the clerk of court’s office in the county the decedent resided and file the necessary documents. This can be completed without legal assistance and the clerk’s office generally has ready-made forms to complete this type of administration. This process generally takes a few weeks to complete.

Summary Administration:

When the probate assets of the decedent do not exceed $75,000 (gross value) or it has been two years or more since the decedent’s death, the decedent’s estate qualifies for Summary Administration. Summary Administration is an abbreviated form of probate and no personal representative is appointed (Executor in some states). Since there is no personal representative appointed, there is no one with the authority to approach financial institutions or others believed to be holding estate property, marshal a decedent’s assets or address creditors. Therefore, if an interested party is unsure of the extent of the decedent’s assets formal administration may be more appropriate.

This form of administration is initiated by a Petition for Summary Administration that requests the Court to distribute the decedent’s asset. All interested parties (beneficiaries or heirs generally) are to join in the Petition or be provided Formal Notice of the Petition and an opportunity to object. If no objections are made to the Petition, an Order of Summary Administration is entered by the Court directing the distribution of the decedent’s assets to those entitled. Once the Order of Summary Administration is entered by the Court, the matter is complete.

One important consideration to be aware of in this type of proceeding involves the decedent's debts. Beneficiaries are personally liable for any debts of the decedent to the extent they exceed the value of the estate after entry of an Order of Summary Administration for two years after the date of death of the decedent. So, although a party may believe there to be no outstanding debts, it's possible that an unknown creditor can surface within two years and make a claim against one or more beneficiaries for payment. So, the beneficiaries can take action to publish a Notice to Creditors and shorten the length of time a creditor can make a claim to 90 days from the date of publication. Alternatively, the beneficiaries could take no action and receive their share of the inheritance subject to any possible claims.

This form of administration can be used by both residents and non-residents and the rules apply the same to both. Summary Administration is generally completed between 1 week and 2 months from initiation.

Formal Administration:

Formal administration is required when estate assets exceed $75,000, the decedent’s Will directs such, or administration is initiated within two years of the decedent’s death. Formal administration begins with the filing of the petition for administration which requests the court to appoint a personal representative and admit the decedent’s will to probate if the decedent had a will (testate). If the decedent did not have a will (intestate) then a personal representative is still appointed (see Florida Statute 733.301) and Florida law sets forth how the decedent’s assets will be distributed (see Florida Statute 733.101-733.103).

After the personal representative is appointed, the personal representative’s job is to:

• marshal estate assets
• inventory the assets
• notify creditors
• pay debts and taxes
• prepare a final accounting
• distribute the remaining assets to the individual named in the will or pursuant to Florida intestacy laws if there is no will

The Personal Representative has certain fiduciary obligations to the estate, its beneficiaries and other interested parties in which he/she has to act in the best interests of those involved.

The time to complete a formal administration depends upon many factors. There are certain statutory waiting periods and deadlines to allow for creditor claims, fully settle the decedent’s affairs, and allow interested persons to protect their rights. Generally, if there are no will challenges, creditor disputes, beneficiary disputes, or the like, then formal administration is likely to be completed within six to eight months from the filing of the petition for administration. However, if there is an objection or If the estate is a taxable estate (either for personal federal taxes or estate taxes), then administration can last over a year or more depending on when the issues with the IRS are completed. I wouldn’t worry too much about estate taxes though as the current taxable threshold is so high right now, over eleven million dollars for an individual, that very few estates are taxable estates. The majority of formal administrations are completed within six months.