Estate Planning Broken Down
The ultimate goal of estate planning is to provide for the management and transfer of your property, in the event of your death or incapacity, at the smallest financial and emotional cost to your family. A properly structured estate plan allows you to choose your beneficiaries, provide for the management of your assets and eliminate or reduce taxes. Without careful planning, your property may pass to unintended beneficiaries or be reduced in value by unnecessary taxes or unsound investments, all of which may cause financial insecurity or bitterness after your death.
Estate planning also addresses such questions as who should own property and what property to own, whether it should be owned jointly or separately, whether trusts are needed for management, control or tax savings, and whether lifetime gifts should be made.
An estate plan must be personalized to consider your objectives and financial situation. This requires a comprehensive review by a qualified estate planning attorney.
We at Nici Law Firm realize that being responsible for administering the estate of a loved one can seem like an impossible task. We will do our best to make the process as simple and efficient as possible. We are here to help you in any way we can.
Probate is the legal process where a court oversees the distribution of property owned in a Decedent’s individual name at the time of his or her death. These assets are referred to as “Probate Assets” and such assets are distributed pursuant to the Decedent’s Will (if the Decedent had a Will) or pursuant to the laws of the State of Florida, if the Decedent did not have a Will. Please note, this does not include any assets that are titled in the name of a trust, jointly held assets or assets passing through a beneficiary designation (i.e., an IRA or paid on death bank account).
When the Probate Assets have a total value of less than $75,000, a “Summary Administration” can be filed. This is an abbreviated estate administration which consists of filing a petition with the Probate Court requesting that an order be entered stating that the Probate Assets are to be distributed pursuant to the Decedent’s Will. The order will be used in transferring the Probate Assets.
If the Probate Assets have a total value of more than of $75,000, a “Formal Administration” is required. The Formal Administration of an estate transfers the Probate Assets pursuant to the Decedent’s Will, after the payment of any claims and the costs of administration. The procedure for Formal Administration is established by filing a Petition for Administration with the Probate Court and requesting the appointment of the Personal Representative named in the Decedent’s Will. The Probate Court will issue Letters of Administration showing that the Personal Representative has the authority to administer the Decedent’s estate.
The administration of an estate can either be testate (when the Decedent has a Will) or intestate (when the Decedent does not have a Will). In an intestate proceeding, the Probate Court will follow the criteria provided by Florida law with respect to authorizing a Personal Representative. The surviving spouse will be considered first. If he or she does not wish to act or if there is no surviving spouse, the Decedent’s heirs have the option to select the Personal Representative. However, if the heirs cannot agree, the Probate Judge will hold a hearing to determine who is best suited to become the Personal Representative. Please note a Personal Representative can be a person or an institution (such as a trust company or bank). However, any individual acting as Personal Representative must be either a close relative of the Decedent or a Florida resident.
We will work closely with the Personal Representative to assist him or her with the administration of the estate. The duties of the Personal Representative include marshaling and protecting all the Probate Assets, preparing an Inventory of all the Probate Assets, reviewing and paying any bills and/or claims against the estate, distributing the Probate Assets to the appropriate beneficiaries, preparation of a final accounting, and the preparation of any necessary tax returns with respect to the estate (and the preparation of the final personal income tax return for the Decedent).
Once we open the Formal Administration and the Personal Representative has been appointed, it is necessary to publish Notice to Creditors to notify potential creditors that the estate has been opened. Notice to Creditors must be filed once per week for two (2) consecutive weeks. Creditors have three (3) months from the date of the first publication to file a claim against the estate (hereinafter referred to as the “Creditor Period”). We will forward any claims that have been filed against the estate to the Personal Representative for review and to determine whether the claims are valid. If the Personal Representative objects to any of the claims, we will file a formal objection with the Probate Court. If there is no objection, then the claims are paid and a Satisfaction of Claim is obtained from each claimant, which we will file with the Probate Court.
During the Creditor Period, we will be working with the Personal Representative to send service of Notice of Administration on all interested parties, obtain appraisals of Probate Assets, prepare and forward copies of the Inventory to all residual beneficiaries, and determine what tax returns need to be prepared and filed with the Internal Revenue Service (IRS).
Once all the claims have been satisfied and all administration costs and the Decedent’s bills are paid, we will be ready to close the estate. This involves preparing a Final Accounting, Petition for Discharge, and serving notice thereof on all residual beneficiaries. If there are no objections to the Final Accounting or Petition for Discharge, then the Personal Representative may distribute the Probate Assets pursuant to the Decedent’s Will (or heirs at law, if the Decedent did not have a Will).
Please note that in the case of a Formal Administration where a Federal Estate Tax Return (IRS Form 706) will be filed with the IRS, it may take up to two (2) years before the estate administration will be completed. A Formal Administration where an IRS Form 706 is not required will generally be completed in six (6) months to one (1) year from the time the Formal Administration was opened with the Probate Court.
In your initial meeting with James R. Nici, Esq. to discuss the facts of your case, you should bring our completed Estate Administration Questionnaire, original Death Certificate(s), if they have already been issued, and copies of documents relating to the Decedent’s assets (i.e. deeds, bank statements, statements from other investment corporations, or financial institutions, stocks, bonds, certificates of title, safe deposit box information, if any, etc.). This will help Mr. Nici determine what type of estate administration is necessary, the approximate time it will take to complete the estate administration and the approximate legal fees with respect to the same.
If the Decedent owned assets titled in the name of his or her trust, a trust administration will be necessary to administer such assets. The trust administration is separate from the estate administration and the trust assets are distributed pursuant to the terms of the trust. The Personal Representative does not have any responsibility over the trust and/or trust assets. The Trustee named in the trust will have the duty of administering the trust assets. We will also assist the Trustee with his or her duties as Trustee of the trust during the trust administration.
Please do not hesitate to contact Nici Law Firm to schedule your initial consultation so that we may help you with the difficult task of administering a loved one’s estate and/or trust. We look forward to assisting you and creating a long-lasting relationship with you and your family.