Many people don’t realize that when a loved one dies and they are named in the person’s will as the recipient of the assets, the money, real estate, and personal property don’t automatically get handed to them. Instead, these asset transfers have to be approved by a judge. This is done by working with an attorney through the legal process known as probate.
Is It Better to Wait to Probate?
Like many states in the country, Florida allows heirs to begin a probate for a deceased relative or friend as soon as the person passes away. Often, there are sound reasons for starting the process within several days or weeks of the person’s passing.
For one thing, by starting early heirs can begin to write an inventory of all the estate’s assets–a requirement for a probate–while the whole family is gathered to grieve or attend the funeral, since different relatives might know different bits of information about where various assets are held. What’s more, the person’s home cannot be put up for sale until several steps are taken in the probate process, meaning the heirs need to keep paying mortgage payments and taxes during this time.
And of course, the sooner the probate is started the sooner it can be finished. This is important because probates take a while to wend their way through the courts, typically months or longer. Heirs cannot receive their inheritance until the process is close to complete.
In some cases, however, it makes sense to wait a substantial amount of time to begin the probate process. This is because Florida law allows for two different types of probates, and waiting can enable the heirs to choose one type of probate over the other.
The Two Types of Florida Probate
Formal Administration. With a formal administration, the state requires more legal paperwork and the courts must more closely supervise the process. Formal administration is required when an estate’s probatable assets exceed $75,000 and it has been less than two years since the person passed away.
The formal administration process involves the following steps:
- The official opening of the estate with legal paperwork
- The appointment of a personal representative (PR) in charge of overseeing the estate
- Allowing creditors to file claims during a set period and then paying all legitimate claims
- Filing all final legal paperwork with the courts documenting all assets and that every heir has been contacted
- Distributing assets following the court’s approval
- Closing the estate, also with the judge’s acquiescence.
In some, albeit rare, cases, estates must also generate and file a federal tax return and pay required estate taxes. Per the most recent law, though, this covers estates only when they are worth more than $11.18 million for a single individual.
Due to the numerous steps involved, formal administrations are more time consuming and incur more court and legal fees than the second type of Florida probate, a summary administration.
Summary Administration. In a summary administration, some of the steps required for a formal are skipped or compressed.
To qualify for a summary administration, an estate’s assets must be valued at less than $75,000, or—and here’s where the timing comes in—the person must be deceased for more than two years.
Because a summary administration moves more quickly through the courts it involves lower court and attorney fees.
That’s why in some instances it pays to delay a Florida probate filing for the two years, so that you can file a summary administration even if the estate is large.
When to Wait for a Summary Administration
These are some of the instances where it may especially make sense to delay filing a probate until the two-year mark has passed:
#1 The estate owes substantial money to creditors.
When a formal estate is opened, the personal representative must publish notice of the death in the newspaper to inform companies and individuals to whom the deceased person owes debt. Creditors then have 90 days to submit a claim to the estate.
By contrast, in a summary administration there is no requirement to notify creditors. That’s because the creditor’s claim period is no longer valid after the two years have passed.
If the deceased person’s debts were significant, a summary administration can save heirs a substantial amount of money.
It’s important to note, however, that any creditor who holds the deceased’s debt can open a probate themselves in order to collect what is owed. Although this happens only rarely, it is always a possibility.
#2 The estate’s only asset is the home, and you or your siblings plan to live there.When heirs want to quickly sell the deceased person’s home, it rarely makes sense to delay the probate. During the delay the heirs will need to keep paying mortgage costs, maintenance fees, taxes, insurance, repairs, and all of the home’s other expenses.
However, if any of the heirs plan to live in the home, they will need to be paying those costs anyway. (Of course, all the other heirs need to agree that the heir can live there.) For example, our firm recently had a client who had moved into his father’s house to help take care of him while he was still alive. After the father’s death, this man, the only heir, decided he wanted to continue to live there. In this case, the home’s expenses weren’t an additional burden but simply the homeowner costs he had already been paying.
Then, years later, when the heirs are ready to sell the house, a summary probate can be performed to transfer the deed for legal conveyance to a buyer.
#3 The Personal Representative named in the will lives out of state.
Florida law has particular requirements for who can serve as a personal representative (PR). For example, a non-relative who does not live in Florida cannot serve as a PR, even if the deceased person designated them in their will..
If the individual is a relative but resides in another state, Florida courts do allow the person to serve as PR. However, they generally require an out-of-state PR to post what is known as a bond, which is money paid by the PR to a bonding company. Since these bonds can be costly, if an out-of-state relative is the PR designated in the will, waiting until you can do a summary administration avoids this inconvenience and expense.
#4 It has been nearly two years since the person died.
Clients often come to the Law Office of Gary M. Landau seeking to do a probate for a relative who passed away more than a year before. Because a formal administration can take months to complete, we let them know they may want to wait until the two-year mark has passed to save themselves money.
Sometimes clients choose not to wait and are later sorry they didn’t. In one case, the client was eager to file the probate and didn’t want to wait, even though the person had died a year and a half before. Due to typical probate court delays, the probate was not completed until after the two years had passed, meaning it incurred the costs of a formal administration without the benefits of speed.
Have Questions about Florida Probate? Contact the Law Office of Gary M. Landau, P.A. in Coral Springs, FL
A knowledgeable probate lawyer can ensure that all your legal documents and a loved one’s probate process are performed properly and efficiently.
The Law Office of Gary M. Landau, P.A., has over 25 years of experience with wills, probates, and other legal services. The firm serves clients in Broward and South Palm Beach counties but also handles probates everywhere in the state of Florida, and has filed probates in nearly every county in the state.
For more information or to discuss your particular matter, call our offices at (954) 979-6566 or complete our online form today to schedule a consultation at no cost. The Law Office of Gary M. Landau is located in Coral Springs, Florida. We can work with you in person, over the phone, or on Zoom.
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The information in this blog post (“post”) is provided for general informational purposes only and may not reflect the current law in your jurisdiction.