What is Probate?
Probate is a court process that requires the assets of the deceased person to be gathered together, all debts of the decedent to be paid by the estate, and then if any assets remain they are to be distributed among the estate beneficiaries. The probate process often takes 6 months to 1 year to complete, and anything filed with the probate court becomes public record.
This is a court supervised process that is required to pass ownership of the decedent’s probate assets to his or her estate beneficiaries. Where the decedent had a valid will, the will must be admitted to probate in the Probate Court for title to the assets to pass to the beneficiaries. If a decedent dies intestate (without a will), probate is necessary to pass title to the beneficiaries under the Florida probate statutes.
Probate only deals with assets that are titled only in the name of the decedent that are not passable by law or by a beneficiary designation. For example, a bank account that the decedent owns with another person is not a probate asset because it passes by operation of law at death to the other party.
However, any asset that is owned only by the decedent at his or her death is included in the probate estate. If a 401(k) or insurance policy has a beneficiary designation to a person or trust, this property is also excluded for the probate estate.
Probate is also required to ensure that the decedent’s creditors are paid, and that state statutes are properly followed.
Why Avoid Probate?
Probate can be a long, complex and sometimes costly process. When opening a probate with the county court, a filing fee is due. Additionally, under Florida law, an estate must have an attorney represent the estate before the court due to the often complex nature of the rules of probate as well as to ensure that the statutory requirements are properly fulfilled. Thus, attorney’s fees also are incurred.
The probate process can range from at least 3 months for a simple probate to more than 1 year for a more complex process. The length of time it takes to complete probate depends on the facts and circumstances of each decedent’s estate, but on average the probate process lasts anywhere from 6 months to 1 year. Estate beneficiaries must wait until the end of the probate process for assets to be distributed to them.
Additionally, probate is a public proceeding. Any member of the public can obtain a copy of the probate filings or a will because the moment filed it becomes public record.
How Can You Avoid Probate?
Using a Revocable Living Trust (sometimes also called “Living Trust” or “Family Trust”) can avoid the probate process. Remember, probate only applies to those assets titled in the decedent’s name at his or her death that do not have a beneficiary designation or transfer automatically under the law. If all of the decedent’s assets are held in a Revocable Living Trust that he or she created during his lifetime, they are no longer titled in the decedent’s name.
A Revocable Trust allows the trust to benefit the person during his or her lifetime, but with the original owner acting as Trustee and thus still controlling the trust assets during life. A revocable trust also has a mechanism in place for another person to manage the trust assets for his or her benefit if he or she becomes incapacitated without having to resort to the guardianship proceedings in the probate court. Upon death, the trust also has someone in place to ensure that the trust pays any debts that the decedent owes at death and distribute the assets as provided in the trust document to other death beneficiaries. Thus the trust assets never go through probate because they were not owned by the decedent, but by the trust at his or her death.
The important thing to remember is that while you can have a beautifully drafted revocable living trust, if you do not move your assets into the name of the trust during your lifetime, then you will not avoid probate. By moving the appropriate assets into the name of the trust, probate can be avoided. A Revocable Living Trust can save money at death, avoid the trust document becoming part of the public record (it’s not recorded with the probate court), and save time.
Last Updated on April 18, 2017 by The Orlando Law Group