Probate Is An Essential Step In Distributing A Decedent’s Estate
Probate is the legal process in which the probate court authenticates a written document as the will of the deceased person and directs the distribution of the estate to the persons entitled to it according to the will. If there is no will (or living trust) or if the will is declared invalid, the probate court distributes the property to the heirs entitled to it under the state laws of intestate succession.
Within a certain time after a person dies, usually 30 days, the person named as the executor or executrix of the will must file the will, a certified copy of the death certificate, and a petition to probate the will with the court clerk to begin probate proceedings.
It is best for an executor to hire a probate attorney who will take care of these things. Contact a probate attorney in New Port Richey at Williams & Ackley P.L.C. for probate consultation today.
Probate Is Intended To Process Estates So That Assets Are Distributed Appropriately
The purpose behind probate, as described above, is to collect a deceased person’s assets; pay his or her claims, taxes and administrative fees; and distribute what is left of the assets to the beneficiaries entitled to them. An executive, or a representative of the deceased, is appointed by the court to pay any outstanding claims or taxes and distribute the remaining assets according to the will. If a person passes without establishing a will, the executor distributes the remaining assets in fixed percentages to the heirs, per Florida state law.
The executor, appointed by the court, is required to take possession of all property left by the deceased, regardless of where it is located. The Florida personal representative (or executor) is also responsible for administering the deceased’s real property in Florida, with the exception of the deceased’s homestead. Because the Florida courts have no authority over real property in other states, the executor appointed in Florida has no authority to manage or administer that property. Because of this, the beneficiaries of the real property in another state must request that a court in that state appoint an executor to manage the real property. This process is known as an ancillary administration.
For creditors to collect, a claim must be filed against the estate of the deceased in the probate hearing. This must occur either three months after a notice to creditors was first published, or 30 days after the executor notifies a known creditor, whichever is longer.
The executor is given the authority to represent the interests of all persons affected by the estate proceeding. Furthermore, it is also the executor’s responsibility to collect the deceased’s assets to pay the creditors, not just the beneficiaries.
Alternatives To Formal Probate
The value of a deceased person’s estate does not always warrant a formal probate administration. Some examples of these instances are as follows:
- Summary administration: The fair market value of assets that can be subject to a summary administration has recently been increased. A circuit judge has the authority to authorize a summary administration for any estate in which the property subject to probate does not exceed $75,000, and the deceased died after Jan 1, 2002. Summary Administrations can also be ordered to confirm the title for a protected homestead that is being given to a surviving spouse or an heir-at-law. This can be done regardless of the value of the homestead. A protected homestead is described as the intended permanent residence of the deceased at the time of his or her death. A summary administration is also allowed for a protected homestead because creditors have no claim to this real property. If all of the beneficiaries and the surviving spouse submit a petition for a summary administration, the judge has the power to order immediate distribution of this property to the beneficiaries named in the will. However, the judge will not grant a summary administration if the deceased has creditors that the beneficiaries have not agreed to pay. Of course, creditors must adhere to the rules of filing a claim to the assets.
- Disposition without need of administration: The Florida statutes allow for the distribution of assets without probate when the value of the nonexempt assets does not exceed the preferred funeral expense of $6,000 plus the reasonable and necessary medical expenses of the last 60 days of the deceased’s life. The judge will review the petition along with the receipts from the paid funeral and medical expenses. If the judge is satisfied with these records, he or she may authorize the payment of the proceeds of the bank accounts to the person who paid those expenses.
- Automobile: If the only property that requires probate is an automobile, the beneficiary named in the deceased’s last will can apply for the Florida Department of Motor Vehicles to issue a new motor vehicle certificate of title in the name of the beneficiary. This application is completed at the county tax collector’s office. The beneficiary must provide the deceased’s copy of the automobile’s title, a sworn copy of the will, and must sign an affidavit that the deceased is not indebted to anyone. If a person dies with no last will and testament, the heir of the deceased can still apply to the DMV for a new certificate of title by using an affidavit that says the estate of the deceased is not indebted, and the surviving spouse and other heirs have amicably agreed to the title transfer.
These alternatives to the normal procedure for probate provide some flexibility to survivors to get access to the estate quicker and easier than waiting on the courts.
Personal Representative’s Compensation
A personal representative, or executor, is compensated from the estate assets for their services. This compensation is earned on a commission basis, dependent on the value of the probate estate, and any income those assets earn. The commission is calculated as follows:
- At the rate of 3% for the first $1 million
- At the rate of 2.5 % for all above $1 million and not exceeding $5 million
- At the rate of 2% for all above $5 million and not exceeding $10 million
- At the rate of 1.5% for all above $10 million
In addition to the standard commission, an executor may be provided with extra compensation for extraordinary services. These services include:
- The sale of real or personal property
- Bringing suit for or against the estate
- Adjusting or paying taxes
- Carrying on the deceased’s business
The court may also adjust all compensation, both ordinary and extraordinary. Before any adjustments to compensation are made, the course must consider these facts:
- The promptness, efficiency and skill with which the administration was handled by the personal representative
- The responsibilities assumed and the potential liabilities of the personal representative
- Whether the estate benefited or suffered from the personal representative’s services
- Whether the administration of this service was complex or simple
The end result is that the executor should be fairly compensated, but not necessarily receive a windfall for the work that they do on behalf of the estate.
The attorney for the executor is also compensated from the estate assets for his or her services. Florida also has existing law that dictates reasonable compensation for services provided by this attorney. The attorney’s compensation is based on the value of the probate assets and all income earned. Compensation is determined as follows:
- $1,500 for estates having a value of $40,000 or less
- $2,250 for estates having a value of more than $40,000 but not exceeding $70,000
- $3,000 for estates having a value of more than $70,000 but not exceeding $100,000
- At the rate of 3% for estates having a value of more than $100,000 but not exceeding $1 million
- At the rate of 2.5% for estates having a value of more than $1 million but not exceeding $3 million
- At the rate of 2% for estates having a value of more than $3 million but not exceeding $5 million
- At the rate of 1.5% for estates having a value of more than $5 million but not exceeding $10 million
- At the rate of 1% for estates having a value of more than $10 million
Like the executor, the attorney is also entitled to reasonable compensation for extraordinary services, including:
- The purchase or sale of real property by the executor
- Involvement in a will contest
- Will interpretation
- A proceeding for the determination of beneficiaries
- A contested claim
- Apportionment of estate taxes
- Any litigation by or against the estate
The attorney may also collect compensation for preparing the estate’s federal estate tax return. Once the gross estate is determined, and the attorney prepares the tax return, reasonable compensation is calculated. The compensation is determined as follows:
- At the rate of .5% for estates having a value of up to $10 million
- At the rate of .25% for estates having a value of more than $10 million.
All compensation, both ordinary and extraordinary, is subject to adjustment either up or down by the court which considers the same factors as they do when adjusting an executor’s compensation. See Florida Statutes Title XLII. Estates and Trusts § 733.6171 for more information.
Need Help With A Probate Matter? Call Us Today.
Whether you are an executor of the estate or a beneficiary, probate issues are painful and often made all the more emotional due to the loss of your loved one. At Williams & Ackley P.L.C., we can help you by providing you with steadfast representation that will guide you through this difficult time. Call our office at 727-361-2973 to schedule a free, confidential consultation with a member of our team. You can also send us a message online if you would prefer to do so instead.