Probate refers to the legal process of administering a deceased person’s estate. In Florida, probate requires hiring an attorney to file documents with the court as certain checkpoints are reached. Reporting to the court makes this process complex and time-consuming. Probate often requires significant time and monetary commitments to resolve. Fortunately, most assets can be set up to avoid probate entirely and pass directly to your beneficiaries without involving any courts or attorneys. Losing a loved one is hard enough without adding the additional stress of probate. By setting up your estate plan to avoid probate you will reduce the unnecessary stress and expenses your loved ones have to deal with when you pass. The attorneys on Cobb Cole’s Estate Planning team work closely with individuals and families to construct plans that streamline asset transfers and minimize the legal hurdles your loved ones would otherwise have to face when you are gone.
1. What is Probate?
Probate is the court-supervised process of transferring a deceased person’s assets to their heirs or beneficiaries. If you die owning assets in your individual name without a beneficiary designation or co-owner, those assets must go through probate to get to your intended recipients. Anything you own when you die is part of your estate. The court appoints a Personal Representative (often called the Executor in other states) to locate, manage, and ultimately distribute the assets in an estate. The Personal Representative must also resolve the remaining affairs of the deceased person by settling any enforcable debts, filing their final income tax return, and anything else that may arise during probate before any assets can be distributed to the beneficiaries. The beneficiaries are determined by the deceased person’s Last Will and Testament (the “Will”). If they do not have a Will, then their assets will be distributed to their heirs, which is determined by the Florida Statutes.
While some probates are straightforward, they all take months to resolve. Any additional complexity adds to the amount of time it will take to complete, particularly if disputes arise between beneficiaries/heirs, if the estate involves out of state property, if there are any creditor claims, if the personal representative must locate distant or estranged heirs, or if there are federal or state estate tax issues. All of the complexities add up to increased time, stress, and expenses for your Personal Representative. Some estates take years and tens of thousands of dollars to fully resolve.
2. Why Might You Want to Avoid Probate?
Besides the time and financial costs, probate proceedings are in the public record, making information about your assets and beneficiaries public information. All of this can be avoid with proper planning so you can ensure your loved ones do not have worry about administering your estate and that you maintain your privacy.
3. How to Avoid Probate?
Florida law offers several ways to transfer assets without court involvement:
Beneficiary Designations: Some assets automatically bypass probate if you name a beneficiary. Retirement accounts, life insurance policies, and payable-on-death (POD) or transfer-on-death (TOD) bank accounts will transfer directly to the named individual. It is important to keep these designations updated to reflect your current wishes.
Joint Ownership: Assets owned jointly with rights of survivorship automatically pass to the surviving owner. For example, a home jointly owned by spouses will pass to the surviving spouse without probate.
Enhanced Life Estate Deeds (Lady Bird Deeds): Florida allows a special type of deed that lets you transfer real property at death to named beneficiaries without probate. You retain full control during your lifetime, including the ability to sell or mortgage the property.
Revocable Living Trusts: These instruments allow you to transfer ownership of your assets during your lifetime into a trust, with you typically serving as the initial trustee. Upon your death, your successor trustee manages and distributes the assets according to your instructions without court involvement.
4. Who Should Consider a Trust?
While some individuals can avoid probate for the bulk of their assets simply through proper beneficiary designations and deeds, others may benefit from establishing a trust. A trust is often advisable for people who:
- Own several parcels of real estate and/or real estate outside of Florida
- Have minor children or beneficiaries with special needs
- Want to maintain greater privacy
- Desire more detailed control over asset distribution
- Are concerned about incapacity and wish to avoid court-appointed guardianship
- Fully or partially own a business
Trusts are an important estate planning tool that provides greater flexibility, control, and can be adapted to address essentially all personal and financial situations.
5. What Happens If You Do Not Plan?
Without proper planning, assets in your name alone at death will go through probate. The court will appoint a Personal Representative to administer your estate, and assets will pass according to your Will or, if you do not have a valid Will, according to Florida law. This could mean that people you would not have chosen, such as distant relatives, inherit your property.
Failure to plan can also lead to family conflicts, delays, and increased costs. In contrast, early planning with Cobb Cole’s Estate Planning team can make asset transfers smooth, efficient, cost-effective, and in accordance with your wishes.
Avoiding probate does not happen automatically. It requires careful attention to how assets are titled and a coordinated strategy tailored to you and your family’s needs.
