Probate & Estate Administration
Guidance For Your Family.
Navigating unfamiliar legal processes can be overwhelming after the loss of a loved one. Lauren A. Merritt, P.A. helps provide the guidance and service that allows you to focus on healing and supporting your family.
What Is Probate?
Probate is the court-supervised process of authenticating a last will and testament or identifying a deceased person's (decedent’s) heirs when there is no will and properly distributing the decedent's estate. During probate, the decedent’s assets are identified and gathered, his or her debts are paid, and the assets are distributed to the appropriate beneficiaries or heirs.
In general, the decedent’s assets are used to pay the following obligations, in order of priority:
The cost of the probate proceeding, including attorney’s fees;
The decedent’s funeral expenses;
The decedent’s outstanding debts.
The remainder of the decedent’s assets are then distributed to the decedent’s beneficiaries or heirs.
Do I Need a Probate Administration?
You need a probate administration if the decedent had probate assets. Probate assets are generally any assets that were owned solely by the decedent, or that were owned by the decedent and one or more co-owners and lacked a provision for automatic succession of ownership at death. Probate is necessary to formally pass ownership of the decedent’s probate assets to the decedent’s beneficiaries and to complete the decedent’s financial affairs after his or her death. Administration of the decedent’s estate also protects the estate’s assets by ensuring that the decedent’s creditors are not entitled to payment unless they correctly follow certain procedures.
Examples of probate assets include, but are not limited to, the following:
A bank account or investment account that is solely in the decedent’s name;
Real property that is titled solely in the decedent's name or held as a tenant in common (including homestead property, although homestead property is generally exempt from creditors' claims);
Personal property, such as jewelry, artwork, automobiles, and boats;
An interest in a partnership, corporation, or limited liability company;
Any life insurance policy, annuity contract, or individual retirement account that lists either the decedent or the estate as the beneficiary; and
Non-probate assets that list a deceased person as the beneficiary.
Examples of non-probate assets include, but are not limited to, the following:
Property held in a revocable trust;
Property that is held in joint tenancy or as tenants by the entirety;
Bank or brokerage accounts held in joint tenancy or with payable on death (POD) or transfer on death (TOD) beneficiaries; and
Any life insurance policy, annuity contract, or individual retirement account that lists beneficiaries other than the decedent or the estate as the beneficiary.
What if There is No Will?
A person who dies without a will dies “intestate,” and the decedent’s assets pass to the decedent’s heirs according to Florida or Alabama law instead of according to beneficiary designations a will. A probate administration is necessary to pay the decedent’s debts and to formally pass ownership of the decedent’s assets to the decedent’s heirs.
Does the Money in a Bank Account Have to Pass Through Probate?
One of the most common assets a loved one leaves behind is a bank account- sometimes multiple bank accounts. A bank account does not have to pass through probate when the account holder listed a pay-on-death “POD” beneficiary (and the POD beneficiary is still living) or if the account is held jointly with another living account holder.
Pay-on-Death (“POD”) Beneficiaries
Bank account holders have the option to list POD beneficiaries on their individual checking and savings accounts at each bank they hold accounts with. The function of the POD beneficiary is just as it sounds- the account holder identifies and designates the beneficiary/beneficiaries he or she wishes the bank to distribute the bank account funds to after the account holder’s death.
After the account holder’s death, the named POD beneficiary should contact each bank to determine what the bank’s POD beneficiary policies and procedures are. Most banks require the POD beneficiary to produce a certified copy of the account holder’s death certificate and a form of personal identification before the bank will distribute the account holder’s money.
A POD beneficiary on a bank account allows loved ones to have access to the money in a bank account without the expense and delay of a probate proceeding.
Joint Bank Accounts
A bank account held jointly between two account holders passes by operation of law to the surviving account holder. For example, assume a husband and wife held a joint checking account. When the husband dies, the wife will become the sole owner of the money in the bank account. None of the money in the bank account will become part of the husband’s probate estate. The bank account money does not have to pass through probate.
What is Florida's Homestead Exemption?
Florida's homestead exemption generally protects a decedent's home from creditors' claims when the property passes to a family member ("heir").
What Qualifies as Homestead Property?
Real property qualifies as homestead property for purposes of Florida probate if:
1) The decedent owned the property as a natural person (as opposed to through a business, etc.);
2) The decedent was a permanent Florida resident;
3) The property was the decedent’s primary residence; and
4) The property was not more than half an acre in a municipality or 160 acres outside a municipality.
Florida courts have expanded definitions of homestead property to include more than just a single family house. Condominiums, manufactured homes, and mobile homes also enjoy homestead protection.
Florida's homestead exemption is among the most protective homestead exemptions in the United States. Unlike some states that limit the value of homestead exemption, Florida's homestead exemption protects the entire value of the property, and there is no limit to the value of the property that can be protected.
No homestead exemption applies if:
1) The homestead is devised to someone who is not an heir;
2) The property was purchased as a future residence but was not yet occupied as the primary residence. 3) The property was a second home or investment property.
What are Exceptions to the Homestead Exemption?
There are exceptions to the homestead exemption. Homestead exemptions do not protect the homestead property from foreclosure by a mortgage holder. Similarly, the homestead exemption will not protect homestead property from pre-existing liens (e.g. homeowner association or condominium association fees) or mechanic’s liens (e.g. the cost of materials and labor used by a contractor to improve or repair the homestead property). If the decedent, during his or her lifetime, used the homestead to secure a debt of the estate, the homestead protection from forced sale most likely will not apply to that particular creditor.
The Internal Revenue Service ("IRS") may file a federal tax lien or serve a levy against the homestead property and force a sale to satisfy a lien for nonpayment of taxes on the property. The homestead property is also subject to the claims of the IRS for any estate tax that might be due.