Editor's note: This is the first in what we hope will be many "primer" articles that we intend to write on the specific areas of Florida law in which our law firm practices. If you have any specific topic requests, please contact us.
"Probate” is a term commonly used to refer to estate administration, which is the legal procedure that may be required to retitle assets from a deceased person to that person’s beneficiaries. It is also an optional procedure to clear creditors’ claims where no estate administration is otherwise necessary.
Technically, the term “probate” refers to only one of several available options for the administration of a deceased person’s estate. However, before we consider the available options, the first step is to determine if an estate administration is necessary.
Generally, in Florida an estate administration of some sort will be required to transfer any asset titled solely to a deceased Florida resident (or to transfer Florida real property titled to a deceased person regardless of state of residence), which does not have an automatic death beneficiary. Assets that will not be subject to an estate administration, because they either were no longer titled to the deceased person, or were automatically retitled upon the person’s death, can include but are not limited to the following:
- Assets titled to a living trust
- Assets with a TOD (Transfer on Death) or POD (Pay on Death) beneficiary designation
- Other assets with an individual beneficiary designation, such as retirement accounts or life insurance policies
- Assets titled as joint tenants with right of survivorship
- Assets titled as tenants by the entireties (husband and wife)
- Homestead, where the property is left to natural heirs
Some assets with beneficiary designations must still be transferred in an estate administration, because the beneficiary is actually the decedent’s estate instead of another individual or individuals. This can occur because the decedent designated his or her estate as the beneficiary specifically (not uncommon for example with older life insurance policies, e.g. “Estate of John Doe”), or unintentionally (for example, by failing to make a beneficiary designation for a retirement account). In these cases the beneficiary is the estate itself, so in order to transfer the assets to the ultimate beneficiaries an estate administration must be conducted.
Even if all of a decedent’s assets pass automatically upon death to individual beneficiaries, it may still be advisable to “probate” the estate because in a formal probate, creditors’ claims can be cut off after 90 days. This may be desirable for estates of professionals who may have unknown liabilities, such a physicians with potential medical malpractice claims. Without a probate, claims can be asserted against an estate or its beneficiaries for up to two years after death.
Copyright of The Law Office of Vincent J. Profaci, P.A., serving Altamonte Springs, Kissimmee, Lake Mary, Longwood (includung Lake Brantley and Sweetwater), Maitland, Orlando, Sanford, and all of Central Florida in the areas of Wills and Living Trusts, Estate Planning, Asset Protection, Elder Law, Probate, Real Estate, and Business Law and Litigation.