You likely know that probate administration is expensive, time-consuming, and public. Yet, there are commonly held misconceptions surrounding this topic which lead many to make uninformed decisions resulting in the need to have an estate probated. While the best way to avoid probate is to speak with an experienced estate planning attorney, let’s take a look at just a few probate and estate planning myths:
I’ll leave my home to my children through a will to avoid probate. This is the most common of all the estate planning myths! The truth is that inherited property cannot be re-titled or sold, without the approval of the probate court, which requires probate administration for the deceased. There are, however, ways to avoid the need for probate including the creation of a new deed where your property eventually passes to your heirs or retitling your home to your trust . (An estate planning attorney can help determine the best option.)
Adding my adult child to my deed is a great way to avoid probate. While your property will indeed pass without probate after you die, there is much risk when adding someone to your deed. The child’s interest in the home is not shielded from creditors via Homestead protection if it is not their primary residence. A fractional interest in the property owned by a person who does not reside there will not qualify for Homestead tax benefits, so your property taxes will increase. What if your child has creditors or is involved in a lawsuit? Or what if he or she divorces? Finally, as your child is listed as an owner, they must sign off on any decision to sell or refinance the property.
I like to save money. Can I obtain the necessary forms and submit them to the probate court myself without the expense of an attorney? In Florida, almost all probate cases require an attorney. There is a narrow exception for very small estates where the number of assets is only sufficient to pay for the funeral and final expenses of the decedent.
My cousin’s estate was settled in just a few months in Michigan, so I’m expecting the same experience in south Florida. Most simple estates can be settled within a year, however. because of staffing shortages and backlogs in Miami-Dade and Broward counties, the process can take as long as 18 months. More complex estates may take several years to settle.
I created a revocable living trust so I am not concerned about probate. A revocable living trust can help you avoid probate, but only if your trust is fully funded. With some important exceptions, all of your real property, personal property, cash and investment accounts, and business interests should be transferred into your trust while you are alive. If your trust is not properly funded, many assets may still have to go through probate after your death before reaching your trust and its beneficiaries.
Life can change in an instant. What are you waiting for?
Bruce Iden earned his J.D. from George Washington University National Law Center and his L.L.M in taxation from the University of Miami School of Law. He has been practicing in the areas of estate planning, real estate, and business law for over 30 years. For more information, or to schedule a consultation with Mr. Iden, contact Iden Law Offices at 954-885-0085 or visit idenlaw.com