Administering a loved one's estate in Florida can be convoluted and anxiety-inducing. That's because Florida probate law is complicated. Florida law requires personal representatives, also known as executors, file forms, inventory estates, and provide notices to heirs. Ensuring that you follow the proper procedures of Florida probate law can be stressful. In this blog post, we'll walk you through the basics of being a personal representative in Florida.
Who Can Serve as Executor?
In Florida, there are legal requirements a personal representative, also known as an executor, must meet. The statutory requirements are pretty straightforward. You must be:
· 18 years of age or older,
· physically and mentally capable of performing the duties of an executor,
· a Florida resident, unless you are a non-resident related to the testator by marriage, blood, or adoption, and
· never convicted of a felony.
In some cases, a bank or trust company can serve as the personal representative if incorporated under Florida law and qualified to exercise fiduciary powers in Florida. Even if someone meets the technical requirements to be a personal representative, you should also consider the practical duties of an executor before making your decision.
Duties of an Executor
The executor is responsible for accounting for, maintaining, and distributing all the assets of an estate. First, you'll need to determine if the estate needs to go through probate, depending on the size and complexity of the estate. Some common transfers don't require probate, such as:
· transferring real estate and assets is owned in joint tenancy to the surviving joint tenant, for instance, when spouses own a home together or have joint bank accounts;
· transferring bank account or securities that are “payable on death” to beneficiaries;
· moving funds in IRAs and retirement accounts to surviving heirs;
· transferring property to a surviving spouse;
· transferring assets held in trust to beneficiaries.
If an estate only holds assets listed above, you can probably avoid probate altogether. This is called a “disposition without administration.” If the estate is worth less than $75,000, you may be able to use “summary administration.” If the estate doesn't qualify for the two more straightforward means of administration, it may need to go through formal probate.
Other duties of an executor may include:
· giving notice to all interested parties;
· taking inventory and possession of all the estate's assets;
· finding and providing notice to any creditors;
· publishing a legal notice for unknown creditors;
· assessing the value of the assets;
· maintaining and managing the estate's assets, including investing, caretaking, and selling assets to pay creditors, beneficiaries, or taxes;
· filing an inventory with the court;
· filing estate tax returns;
· paying creditors;
· distributing assets to beneficiaries;
· reporting the distribution of assets to the court; and
· closing out the estate.
A personal representative should notify all family members or interested parties of the proceedings.
How Do I Become an Executor of an Estate?
The process of becoming the personal representative of an estate in Florida will vary depending on whether or not the estate must pass through probate.
1. No Probate
If the estate doesn't need to go through probate and qualifies for disposition without administration or a summary administration, the court won't appoint an executor or personal administrator. Instead, the person named in the will as executor will file a Petition for Summary Administration listing the assets, their value, and who will inherit the assets. The court will issue an order releasing the property to the rightful heirs.
If the estate must go through probate, the executor named in the will, or any interested party, can ask the court to name them as the personal representative. The court will issue Letters of Administration authorizing the personal representative to settle the estate.
The estate generally compensates the personal representative for their time. The compensation is usually set one of several ways:
· as outlined in the will;
· as set forth in a contract between the executor and the decedent;
· as determined between the executor and the beneficiaries;
· as determined to be reasonable by Florida law;
· as specified by the judge.
Challengers Executors Face
Being the personal representative of an estate is a big, and somewhat complicated, responsibility. Still, there are some mistakes and challenges that personal representatives commonly face.
1. Failing to Identify and Secure Assets of the Estate
One of your first duties as a personal representative is to find and secure all of the estate's assets. If you miss something, that could be a financial loss to the estate and the beneficiaries. Even if the will directs a specific recipient for an asset, the personal representative must still collect and hold on to that asset until the proper distribution time.
2. Improperly Paying Claims Against the Estate
As a personal representative, you can't just pay claims and bills in any order. Under Florida law, there is a statutory order of precedence. If you pay claims out of order and the estate doesn't have enough funds to cover all creditors, you could be personally liable.
3. Ignoring the Beneficiaries
It can be stressful to keep in communication with the beneficiaries of the estate. They may have questions you can't yet answer. But as a personal representative, you should keep the beneficiaries notified throughout the probate process.
Should I Hire an Attorney?
You may need to work with an estate attorney to administer and finalize the estate in cases of a more significant estate. An attorney can help you with the procedural requirements, ensure you understand all of your required duties, and assist with estate tax filings. An estates attorney can also help you:
· advise you of all legal deadlines and necessary filings;
· prepare any necessary legal documents;
· advise on the proper form for inventories and other court-required filings;
· assist you in locating experts to value estate property and assets;
· advise you on any required estate tax filings;
· file required documents with the court; and
· make court appearances for the estate.
If you are the executor of an estate and need guidance throughout the process, give us a call. If you are beginning your estate planning, we can help you as well. The probate and trusts and estates attorneys at Veliz Katz Law have more than 60 years of experience helping clients in Central Florida administer their loved ones' estates. Call us at 407-849-7072 to schedule your free consultation or contact us online.