People will often come into the office with one goal … AVOID PROBATE. Others will come into the office afraid of what is about to happen because they have been told they need to go through Probate. The truth is Probate Court in and of itself is not something to be feared.
Most problems in probate are a result of poor planning or poor communication between family members. When families work together often probate is easier, cheaper and faster than even a Trust.
What is Probate? Probate is the process that takes an individual’s assets and distributes them according to their Last Will & Testament. If there isn’t a Will the State of Florida has drafted one for the individual.
What about paying off unpaid debit? Any creditors that remain unpaid at the time of death will be paid (if there are funds).
What about taxes? If the estate’s value is less than $5 million dollars there will likely not be any taxes other than normal income taxes. Real Estate and Brokerage accounts will get a new cost basis, which means when sold you will be taxed on the gains from the date of death to the sale date. This is a primary reason transfers prior to death need to be calculated. IRA's are a special exception which should be addressed with 12 months of the date of death.
How long does the probate process take? The time period for probate also depends on the size of the estate. Small estate (those valued less than $75,000 excluding the home, cars, and personal belongings) will last between 2-3 months on average. Other estates will take 6-7 months on average; however, funds can be made available earlier if needed and people work together.
Can probate be avoided? Still for some the idea that their life will be played out in Court is too much. For those people avoiding probate is important. How we avoid probate will largely depend on the size of the estate. It is possible to avoid probate without the use of a Trust. In fact, our office recommends a trust in very few cases due to the cost and mismanagement by trustees. Our firm believes that all avenues should be researched rather than simply trying to find a one size fits all approach.