Formal Vs Summary Administration
Estates with a value of $75,000 or less are considered small estates and may be eligible for a shortened probate process known as summary administration. In cases where there is a large estate or complex issues arise, the court will not allow summary administration. The full probate process is known as formal administration. If a small estate has pending litigation or an IRS audit for concerns regarding estate taxes, it will be forced to undergo a formal administration as well. This can apply even in situations where assets are in a revocable living trust.
Florida Statute 735.201 discusses summary administration. To qualify, the estate has to have non-exempt assets that total $75,000 or less, or it’s been more than two years since the decedent’s date of death. Non-exempt assets are ones that are not protected from creditors.
Opting for summary administration is an ok option when there are very few or no creditors or the estate has exemptions, like homestead property or vehicles. For cases where the decedent has been dead for two years or more, summary administration might not be the best option in every situation.
There are a number of things you need to consider when considering summary administration. These include:
- Assets must be specifically identified. For example, the petitioner for the estate needs to have the bank account number and know the approximate value/balance.
- If there are any new assets located, you must reopen summary administration. This is not necessarily that common, but there are situations where you might discover new assets once the probate is closed. This means you may need to file a new petition to reopen the estate, which means additional costs and fees. Before you opt for a summary administration, you should be sure there are no other assets out there.
- You still need to publish a Notice to Creditors (NTC). Some people claim you don’t need it, but a failure to publish it means you could be forced to reopen the estate, leaving any beneficiaries that received assets exposed to potential future claims of creditors. By publishing the NTC, future unknown or unascertainable claims are not pursuable.
- There will be no personal representative appointed with a summary administration. This can be a frustrating challenge if you have a bank who won’t speak to you since you don’t have proof you are the executor. This means you are stuck, and you will need to convert the summary administration over to a formal one.
There are a variety of reasons an estate may need to go through formal administration. There may be claims that need to be dealt with, like an elective share lawsuit or a homestead exemption. If the deceased was involved in active litigation prior to their death, they will be required to undergo formal administration.
Retaining a Florida Probate Attorney
If you have questions on estate planning or probate, you need to speak with a knowledgeable Florida probate attorney. The Law Offices of Larry E. Bray, P.A. has been helping clients throughout Florida for over 30 years. Contact our West Palm Beach office at 561-571-8970 to schedule a consultation.