Probate & Estate Administration

Probate and estate administration are the processes through which estate assets are transferred after death. If probate avoidance planning has not been implemented prior to death, the state will require a probate court proceeding if the deceased was a resident or if the decedent owned assets in the state.

During the probate proceeding, the decedent’s appointed personal representative manages assets, pays any debts, files required tax returns and various court documents, and distributes the estate assets. However, the court may at any time require the process to be supervised. In a supervised probate, the probate judge must approve every detail of the estate administration.

Probate Avoidance

Since probate can be a lengthy, costly and public process, many people choose to avoid it. There are a number of legal strategies that can allow a person to pass property to another person after death without going through probate.

• Joint Tenancy & Tenancy by the Entirety.  Owning assets as a joint owner or “joint tenant with rights of survivorship” allows property to pass to surviving joint owners without going through probate. There are several problems with this strateg; it subjects the jointly-held assets to any claims (such as lawsuits) against the co-owner, and it makes the assets available to the co-owner’s creditors.
• Beneficiary Designations.  Florida allows Transfer on Death (TOD) or Payable on Death (POD) beneficiary designations to be added to bank accounts and brokerage accounts. Beneficiary designations may be preferable to joint tenancy in that they allow transfers of property only upon death without transferring current ownership. One of the drawbacks of this strategy, however, is that it can be difficult to obtain an equitable distribution of property among your beneficiaries. Additionally, TOD or POD assets will be distributed upon your death to the listed beneficiaries, even if the account owner’s last will and testament dictates otherwise.
• Revocable Living Trust.  A Revocable Living Trust is a legal document establishing a separate entity (the trust) to hold legal title to assets while the grantor (trust-maker) is still alive. The grantor names trustees to manage the trust assets according to the trust terms. Typically, thr grantor will manage the trust assets for their own benefit. Upon disability or death, the trust terms appoint a successor trustee who then continues to manage or distribute the trust assets. A properly drafted trust can accomplish many goals, including guardianship or probate avoidance as well as marital dissolution and creditor protection.

Estate and Trust Administration

A properly drafted trust will generally accomplish the goal of probate avoidance. The trust need does not to be filed with the probate court. Nonetheless, the trust must be administered: beneficiaries must be contacted, assets must be managed, potential creditors must be notified, debts, taxes and final expenses must be paid, and, ultimately, any remaining income and assets must be distributed in compliance with the trust terms. Successor trustees often lack the time, resources or knowledge necessary to personally administer the trust, and they may call upon legal, accounting and investment professionals for assistance. A corporate fiduciary (e.g., a trust company) is an excellent alternative to relying solely on busy family members or friends to serve as trustee. The Law Office of Brian C. Perlin, P.A. can help your successor trustee(s) deal with the complexities of administering your trust.