What is a Probate
Probate is a formal Legal process, more specifically, a Judicial process whereby the Will of a person who has died is recognized by a court of law. Executors or Personal representatives are then appointed by the court to distribute the property/assets among the beneficiaries. Everything is done here under the supervision of the Court of Law and this process requires a lot of patience, time, and money.
This involves organizing the money, assets, and possessions of the dead person and after paying any taxes and debts, they are distributed as per the instructions in the Will.
Read more about Probate.
Assets That Don't Go Through Probate
A person might have a number of assets at the time of his/her death. Not every asset he/she owns will go through probate.
If you have the following assets or properties as a part of your Estate, they will not go through probate.
1. Jointly owned Assets.
Any property owned jointly with another person does not go through probate. For example, bank accounts and real estate, but can also involve any other asset with a joint owner.
2. Beneficiary accounts.
There are certain assets that are transferred directly to your beneficiary after you die. These are:
- Insurance policies
- And other retirement accounts.
Beneficiary designations override what is written in your will. So it is important to keep them updated.
3. Transfer-On-Death (TOD) assets.
You can use a transfer-on-death form to name beneficiaries for vehicles, securities, and real estate to bypass probate. Cars, small boats, stocks, bonds, brokerage accounts, land, and houses all qualify.
A TOD designation helps in a direct transfer of your assets and property to your named beneficiaries.
4. Payable-On-Death bank accounts.
It is an agreement between you and the bank or credit union accounts that can avoid probate by automatically transferring your assets to the designated beneficiaries.
5. Living Trusts.
If you create a Living Trust, your estate will be transferred to your beneficiaries soon after your death without any involvement of the Court.
Your Successor Trustee will make the distribution as per your wishes by transferring the ownership of the Trust property to your beneficiaries.
What is Disposition Without Administration in Florida?
Disposition Without Administration is a quick and inexpensive informal probate process in Florida, designed for estates of minimal value. It is used to request the release of assets of the deceased to the person who paid the funeral and/or final medical bills.
Florida Statute §735.301 deals with this process of Disposition Without Administration.
The following assets are exempted under Disposition Without Administration.
- Household goods or furnishings up to $20,000 in value.
- 2 personal motor vehicles of the deceased.
- Any qualified tuition plans under Section 529 of the Internal Revenue Code.
- Personal property up to $1,000 in value.
- The property whose value doesn't exceed what's owed in the final expenses of the last 60 days of the last illness.
Note - Any Real property is not covered under Disposition Without Administration.
If the deceased person died intestate, the following must be fulfilled to qualify for disposition without administration:
- The deceased person must be dead for more than 1 year.
- There must be no probate pending in Florida.
Disposition Without Administration does not require the help of an attorney to file it. You may find the relevant forms to file this in the country courthouses and the filing fees is also minimal.
Summary Administration in Florida
Summary Administration is a simplified probate procedure in Florida for small Estates. It's an option if either:
- The person has been dead for more than 2 years
- The value of the probate estate is not more than $75,000.
A document called Petition for Summary Administration is required to be filed by the beneficiary or the executor of the deceased’s Will.
In case the deceased was married. The surviving spouse, if any, must also sign and verify the petition.
The petition must contain the following information:
- That the estate qualifies for summary administration
- List of the deceased’s assets
- Value of the assets, and
- The inheritors of the assets
Formal Administration in Florida: The Regular Probate
When the value of assets is more than $75,000; the formal administration process is needed.
The Process of Probate is explained in the following steps.
1. 10 days deadline for probate filing
The person in possession of the Last Will and Testament of the deceased needs to file it before the probate court within 10 days from the death of the deceased.
2. Granting Letters of Administration
The probate court will recognize the Will and it will issue the letters of administration to the estates’ executor that allows the executor to fulfill their duties against the deceased (that is the administration and distribution of assets).
3. Notifying the Creditors
The next stage in Florida Probate is to notify the deceased's creditors. This is done by the executor of the estate.
Notices are usually published for 2 weeks. 90 days is given to creditors to file their claims.
4. Proving death
The next step is to provide the creditors with evidence that the estate holder has died. This has to be done within 90 days of issuance of the notice.
5. Verified Statement
After giving notice to the creditors, a verified statement has to be submitted in the probate court within 4 months that all the creditors who have claims against the Estate have been checked for them.
6. Validity of Will
The probate now determines the validity of the Will. That is, whether the deceased left the Will or not. The time for this step is not fixed and differs from case to case.
Estate executors have to file their findings to the court after taking the estate into account. Interested parties may, within 30 days challenge the given accountings. If the accounting is contested, probate may take longer than usual.
After the issuance of letters of administration, the executor, within 1 year, is required to submit the distribution receipts of the estate in court.
Distribution is done after all the creditors’ claims have been settled and taxes are paid.
9. Closing of Estate
After the distribution, the executor has to apply for the closure of the Estate in court. Once the court grants the closure, it signifies the end of the probate procedure.