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Estate Probate Blog

How Do You Value an Estate for Probate?

Every estate that goes through probate must be valued. Valuing the estate occurs after the notice of administration has been filed with the probate and creditors/beneficiaries have been notified that the estate has entered probate. During estate valuation for probate, the decedent’s belongings and possessions are appraised, consolidated, and assigned a monetary value. Estates are valued to ensure debts and creditors can be repaid. The estate value also determines whether the estate qualifies for summary or formal administration. Here are some important factors to consider when valuing an estate during probate.

Types of Property

 Any property that’s considered a probate asset needs to be valued. Here are some examples of the types of property that would be valued during probate proceedings:

Real Property

Real property the decedent owned will be appraised and valued during probate. Real property includes homes, land, vacation houses, and timeshares.

Personal Possessions

Notable personal property will also need to be valued for probate. This includes cars, boats, household items, electronics, and furniture. It also includes the value of family heirlooms, collections, and jewelry.

Financial

Financial property is money in bank accounts the decedent owned. This includes the value of life insurance plans, retirement accounts, and savings. Business assets and intellectual property (copyrights, trademarks, and patents) are also valued.

Methods for Evaluation

Estate valuation for probate determines the fair market value of the decedent’s possessions. Different evaluation methods may be employed depending on the asset. For instance, a market approach is often utilized when valuing real property. With this approach, value is decided by analyzing the sale prices of comparable properties in the area and determining what a piece of property in similar condition and age would be worth. The value of property like timeshares, cars, and boats can be found using similar methods. Any asset estimated at $50,000 or more may require a formal appraisal.

What Assets Are Exempt from the Evaluation Process?

Only some possessions the decedent owned need to be valued for probate purposes. Non-probate assets don’t need to be valued. Examples of non-probate assets include possessions the decedent jointly owned with someone else, financial accounts with “payable on death” or “transfer upon death” benefits; life insurance plans with a beneficiary designation. Shared property that benefits a surviving spouse and their children, such as a family home, furniture, and up to two cars, are exempt, too.

Estate Valuation for Probate Steps

Here are the steps to value an estate in Florida:

  1. Gather all assets.

Gather all the probate assets together in one place to begin. Create a spreadsheet to ensure you stay organized. In the spreadsheet, list each possession and leave space to put each item’s estimated value. The list should include all probate assets, from real estate to stocks.

  1. Determine fair market value for personal property.

The second step is determining each possession’s value when the decedent passed away. Formal appraisals may be ordered for some of the most valuable assets. For others, value is determined through internet research and expert insight. If the decedent jointly owned property, only the decedent’s share would be subject to estate valuation for probate.

  1. Create an estate bank account.

As property is valued, an estate bank account should be established. This is the bank account that all profits from sold possessions and property should go in. Funds from the decedent’s accounts are also put in this account. Creditors will be paid out of existing funds from this account.

  1. List all debts and known creditor claims.

List out any known creditor claims against the estate, as well as any debts the decedent had. Note the value of each claim and the party that’s owed money. You’ll also want a probate attorney to look over each claim to ensure it’s a valid creditor claim.

Estate Administration with Boutty Law Firm

Personal representatives have many responsibilities, including estate valuation for probate. Our attorneys at the Boutty Law Firm will help you through each step of the probate process, including collecting and valuing the estate and paying creditors. Call our office at 407-622-1395 or contact us online to discuss your case.

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Reasons For Challenging a Will

If you’ve been wrongfully removed from a loved one’s will or believe someone has unfairly influenced how a will was created, you may want to challenge its validity in court. Challenging, or “contesting,” a will is a complex process that can take an emotional toll on family members who have just lost a loved one. That’s why it’s important to have an experienced probate attorney on your side to help you ensure the appropriate legal action is taken. Anyone with a vested interest in the outcome of someone’s will can challenge its validity, even if they aren’t named as a beneficiary. Here are the most common reasons to challenge a will in Florida:  

Undue Influence  

Undue influence is the intentional manipulation of the terms of a will to greatly benefit one person. Undue influence is one of the most common reasons to challenge a will. It happens when someone tries to coerce or threaten the testator (the person who created the will) to make a will that benefits a specific person. For instance, a family member who’s the primary caretaker of an elderly relative may convince your relative to leave everything in their will to them. To prove undue influence, you’ll need to provide evidence that someone persuaded the testator to create the will in a particular way.  

Unlawfully Created  

For a will to be valid, it must follow the guidelines stated in Florida Statute 732.502. The testator must be over 18 and legally able to create a will. The will must be in writing. It also must be signed at the bottom of the document by the testator and two witnesses. It’s preferable that the two witnesses are not beneficiaries in the will.  

Incapacity  

A testator must be of sound mind to create a valid will. The testator must have a complete understanding of what they’re doing at the time of signing the document. If the testator has a persistent condition (such as late-stage dementia) that prevents them from fully acknowledging the gravity of the document they’re creating, the will would be invalid. To prove this in court, you may have to provide diagnosis information and testimonies from medical professionals that can authenticate the testator’s condition.  

Wrongfully Removed  

If you feel you have been wrongfully removed from a loved one’s will, you may be able to challenge your removal. To do this, you’ll need to prove that the testator planned to include you in the will but didn’t, either by mistake or coercion. You will need to provide evidence showing your loved one planned to list you as a beneficiary. This could include prior drafts of the will with you listed as a beneficiary or a written statement from the testator before they died about their intention to include you. 

Fraud 

A will made under false pretenses is invalid and can be challenged in probate court. This could include acts such as forgery, lying, and inaccuracies. 

How to Challenge a Will  

You can challenge a will if you stand to benefit significantly from the will’s outcome, even if you’re not listed as a beneficiary. To contest a will, you must file a petition with the probate court handling the estate within 90 days of the Notice of Administration (the formal beginning of probate). The petition should specify whether you want the will to be revoked, modified, or made invalid. It should also explain why you’re challenging the will. After the estate is notified, the case will either be settled or go to a hearing for a judge to determine the will’s validity.  

Boutty Law Firm: Central Florida Probate Attorneys  

Contesting a will can be a challenging and emotional process. However, sometimes there’s too much at stake, and action must be taken to preserve your family’s legacy. At Boutty Law Firm, our experienced legal team can provide the guidance you need to navigate challenging a will. To schedule a consultation, please call our Orlando office at 407-622-1395.

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formal-blog

Summary vs. Formal Administration: What’s the Difference?

Probate: Navigating the Legal Process of Estate Settlement in Florida 

Probate is a legal process that takes place after the passing of an individual to settle their estate. It involves the closure and distribution of funds from financial accounts, division of personal possessions, handling of creditor claims, and estate valuation. As probate can be time-consuming, understanding your options as a beneficiary or personal representative is crucial. In Florida, there are two primary types of probate: summary administration and formal administration. To make informed decisions, it’s important to comprehend the nuances of each approach. 

Understanding Summary Administration 

Summary administration offers a simplified probate procedure designed for small estates. It is characterized by shorter timeframes and lower costs compared to formal administration. However, this process is only applicable to estates that meet specific criteria, outlined below: 

Qualifications for Summary Administration 

To qualify for summary administration, the estate must satisfy at least one of the following conditions: 

  • The estate’s total value is under $75,000. 
  • The decedent passed away over two years ago. 
  • Creditors are legally prohibited from making claims against the estate. 
  • The decedent’s sole assets are exempt from probate. 
  • The decedent’s sole assets are exempt from creditor claims. 

For detailed eligibility guidelines, refer to Florida Statute 735.021. 

Summary Probate Procedure 

The steps involved in summary administration in Florida are as follows: 

  1. Petition for Summary Administration: Any beneficiary or appointed personal representative can initiate a petition for summary administration during probate proceedings, provided the estate meets the specified criteria. The petition must include documentation verifying the estate’s value, encompassing financial accounts, real property value, and business assets if applicable. 
  1. Creditor Search: To qualify for summary administration, creditors must be unable to file claims against the estate. As part of the petition process, comprehensive documentation demonstrating diligent efforts to identify potential creditors and eliminate valid claim possibilities must be presented. 
  1. Asset Distribution: Upon confirming the estate’s eligibility for summary administration and completing the creditor search, a judge issues the summary administration order, effectively concluding probate. The judge’s order can then be presented to relevant institutions, such as banks and insurance companies, to facilitate the distribution of assets to beneficiaries. 

Formal Administration: A Comprehensive Process 

Formal administration is the predominant probate method, especially for executing a will. The timeline for formal administration typically spans six months to a year or longer, depending on the complexity of the estate. 

Qualifications for Formal Administration 

Formal administration is mandatory for estates with probatable assets exceeding $75,000. This form of probate is also required if the will is contested, even if the estate’s value falls below $75,000. 

Steps of Formal Administration 

The formal probate process in Florida encompasses the following steps: 

  1. Petition of Administration: Formal administration commences when the estate’s personal representative provides necessary documentation, including the death certificate, financial statements, and the will, to a probate attorney. Subsequently, the attorney files a formal petition of administration with the probate court in the county where the decedent was a resident. 
  1. Validation of the Will: The probate judge verifies the validity of the will and grants legal authority to the designated personal representative to execute the will. 
  1. Beneficiary and Creditor Notification: The personal representative informs all beneficiaries listed in the will about initiating probate proceedings. Moreover, the personal representative is responsible for notifying potential creditors with claims against the estate. This notification process adheres to the formalities specified in Florida Statute 733.2121. Creditors are granted a 90-day window, starting from notification, to file claims against the estate. 
  1. Estate Valuation: The personal representative gathers documentation and assets to assess the estate’s value and establish an estate bank account. Assets might need to be liquidated to settle valid creditor claims. The estate bank account funds the repayment of creditors. 
  1. Probate Conclusion: After addressing all creditor claims, beneficiaries are entitled to the assets delineated in the will. Upon asset distribution, the attorney files a petition of discharge, marking the formal conclusion of the probate process. 

Legal Expertise for Smooth Estate Proceedings 

Navigating the intricacies of probate is essential to ensure a smooth estate settlement process. Whether you are a personal representative or responsible for handling someone’s estate, understanding your options can save both time and resources. If you are seeking expert guidance in estate planning and probate matters, contact the Boutty Law Firm at (407) 622-1395. Our dedicated team is here to assist Orlando and Central Florida residents, helping you make informed decisions during probate proceedings. 

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How to Handle Creditor Claims During Probate

Personal representatives have many roles during the probate process, including valuing the estate, notifying beneficiaries, and assisting in distributing assets. Another crucial responsibility personal representatives have during probate is to notify creditors that the estate has entered probate and to settle debts. There are specific requirements personal representatives and creditors must follow to ensure valid claims are paid. Below, we discuss what you need to know about handling creditor claims during Florida probate proceedings.  

What is a Creditor Claim? 

Creditor claims are formal notices against the decedent’s estate, indicating that a debt is owed. Valid claims are paid from the estate’s value before assets and funds are distributed to beneficiaries listed in the will. 

Types of Creditors 

Anyone the decedent borrowed money from and didn’t pay in full could have a valid creditor claim against the estate. Creditors can be individuals, companies, or organizations. Types of creditors may include:  

  • Mortgage lenders  
  • The IRS 
  • Plaintiffs in open lawsuits against the decedent 
  • Individuals who were promised payment from the estate upon death 
  • Funeral service providers  
  • Credit card companies  
  • Home-related service providers  
  • Medical facilities  
  • Ex-spouses who are owed back child support 
  • Business owners

How to Notify Potential Creditors 

Personal representatives must follow specific guidelines to formally notify creditors that the decedent’s estate has entered probate, as stated in  Florida Statute 733.2121. Personal representatives must publish a Notice to Creditors once a week for two consecutive weeks in a newspaper located in the county where the estate is administered. If there isn’t a local paper, the notice can be published in any newspaper in general circulation in the county. The notice must include the following: 

  • The decedent’s name 
  • Court address 
  • Estate file number 
  • The personal representative’s contact information 
  • Date of first publication 
  • Creditor claim period dates  

The personal representative must provide proof of the public notice to the probate court within 45 days of publication.  

In addition, personal representatives must locate potential creditors and send the notice directly to them. Personal representatives must conduct proper research to find and notify potential creditors. However, they aren’t liable for failing to inform creditors as long as a reasonable effort is made.  

Creditor Claim Distribution 

Creditor claims are paid from the value of the estate. Creditors must show proof of the money the decedent owed by referencing a contract, providing a promissory note, or supplying a transaction history of other payments. According to Florida Statute 733.705, creditors have three months after the notice publication to make claims against the estate. If the creditor was contacted directly, they have 30 days to file a claim. In most cases, claims are paid out five months after the first notice was published. 

Florida laws dictate the hierarchy used to determine how creditor claims are paid off. Claims related to probate administration and attorney’s fees are paid off first. Next are funeral service providers. Then, any federal claims to the estate, such as back taxes, are paid.  

Objecting a Claim  

Personal representatives or any beneficiary with a vested interest in the estate can object to a potential creditor claim. They must file a formal written objection within four months after the notice was published or 30 days after the creditor filed the claim — whichever was later. 

Navigating the Complexities of Probate with the Boutty Law Firm  

Probate is a time-consuming process with many formal parts. To ensure probate proceedings are handled effectively and efficiently, it’s important to work with an experienced Florida probate attorney, like our team at the Boutty Law Firm. We’ll help guide you through the probate process and help assess issues, such as handling creditor claims. Call us at 407-710-0461 to schedule a consultation.

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