What Assets Go Through Probate in Florida?
For the most part, if a person dies with or without a will and has assets in his or her name only, then probate is necessary to distribute the assets and property. But what assets go through probate in Florida?
Probate, often referred to as estate administration, is a legal process that distributes the estate owned by a deceased individual to beneficiaries. The estate of the deceased may include things like vehicles, bank accounts, real estate properties, jewelry, home furniture, investments, tools, and much more. If the decedent died with a valid will, then in most cases it will also name an executor of the will who will be in charge of the estate and eventually play a role in the distribution of the assets.
What assets go through probate in Florida? Probate is needed in most cases in Florida even when the decedent has a valid will. The will needs to be registered with the local probate court within 10 days of the death of the decedent. The court will then determine if the will is valid. The assets of the decedent can only be transferred after the estate has been opened in probate court. The most important priorities of the probate court are to ensure that the rightful beneficiaries are identified and that they receive the assets accordingly.
Types of Probate
In Florida, there are two types of probate administration: formal and summary administration. In general, summary administration is a much simpler process, whereas formal administration usually requires the services of an executor. When the estate is larger, it is a much more prolonged and costly affair.
In general, summary administration is cheaper, faster, and less complex than formal administration. However, to be eligible for summary administration, the estate must contain less than $75K in non-exempt assets or the assets belong to a decedent who passed away more than 24 months ago.
Formal administration is a much more complex procedure and is time-consuming. It is usually required for all estates with non-exempt assets that have a value of over $75K when the decedent passed away less than 24 months ago. Formal administration is also necessary when an executor (personal representative) is required to settle the affairs of the decedent.
In both cases, the executor of the will usually will identify the beneficiaries of the estate, the creditors, and lien holders, and present the documents to the probate judge. Prior to distributing the estate, the judge will ensure that all creditors have been paid and tax issues resolved - only then can the beneficiaries receive the remaining assets.
How Long Does Probate Take?
The Covid pandemic has further slowed down the court proceedings, but formal probate can take nine months and, in more complex cases, where the validity of the will is in question or there is disagreement among the beneficiaries, the process can even take a few years to resolve.
What Assets Go Through Probate in Florida?
In most cases, any asset that is titled only in the name of the decedent (not jointly owned), does not have a designated beneficiary, is not payable on death, or is left out of a living trust is subject to probate. The most common assets that go through this process include:
Stocks and bonds
Cars, boats, airplanes
Other personal property
Is Probate Required for Household Items?
Yes, household items are considered assets that have to pass through probate. Common household items include jewelry, clothing, artwork, furniture, etc. Even if your items do not have high monetary value, they do have sentimental value. After probate has concluded, the personal representative will distribute the household assets accordingly.
Which Assets Usually Do Not Undergo Probate?
There are no monetary gifts and inheritance taxes in Florida. As of 2018, Florida does not have a state gift tax due to the passage of the Economic Growth and Tax Relief Reconciliation Act. However, the federal government does enforce a tax, but only on gifts of more than $15,000. Not all assets go through probate, and they include the following:
All assets under a living trust
401K or life insurance where a beneficiary has been designated
Funds held in a pension plan
Securities, funds, or savings bonds that are registered to transfer on death or payable on death documents
Salary, wages, or commissions
Boats or cars registered with transfer upon death form
Some household goods (up to a value of $20k) are usually distributed to immediate family members
All jointly held assets (e.g., bank accounts)
All assets with a beneficiary designation
Two used motor vehicles may be transferred without probate as long as the decedent regularly used them
The probate venue is usually held in the county where the decedent lived and died. If the decedent was out of state, the probate case is filed in the county where the decedent owned real estate. Courts in Florida can only distribute property located within the Sunshine State. In addition, the probate court only has jurisdiction over property that was owned by the decedent. During probate hearings, not all the beneficiaries and heirs have to show up to court. Today, one can participate in the court hearings via telephone or video conferencing.
Even though most people do not like to prepare for death, it is a necessity. If you die without a will, then the government will distribute it to the heirs according to intestate succession laws, and the assets may go to people you did not want to receive them. To avoid hassles and ensure that your beneficiaries get their fair share of the estate, it is important to have estate planning and that includes making a will. Consult with a knowledgeable estate lawyer at Elder Care, P.A., and learn more about probate. Call today at (561) 933-4769. Being proactive will give you peace of mind.