Who Pays Back the Expenses Related to a Homestead Property in Probate?

In the process of administering an estate in probate court, especially an estate that has real property or a homestead, the way that these expenses are classified affects who pays them. It even affects whether or not those expenses can attach to homestead property as a lien on the property itself.

Beneficiaries Inheriting a Homestead Property (or Not)

Beneficiaries inheriting a home from the deceased would naturally prefer that expenses from administering an estate, be borne by the estate itself. That is, that they “come off the top,” of the estate assets in general, and not come out of or affect the homestead that they are inheriting.

This way, the costs are paid from the estate, and the beneficiaries get their property free from any liens (at least, free from liens related to the maintenance, upkeep and repair of the property they just inherited).

Others who inherit non-homestead property in a probate case, might prefer the opposite–let the lien on the homestead property stand, thus allowing more assets in the estate itself, to be distributed to beneficiaries, and let whomever gets the homestead, deal with the expenses related to that home.

Two Kinds of Expenses

Florida law actually does provide a difference between two main categories of expenses that an estate incurs, in the administration of a probate estate.

Any expense that is directly tied to or related to the upkeep, insurances, maintenance or repair of homestead property, can be imposed as a lien on that property, even after it transfers to whomever is inheriting it.

Expenses related to the administration of non-homestead property, are paid from the estate itself, unrelated to homestead property. No lien can be put on homestead property, to pay back the estate for these expenses.

Which is Which?

Often, it is unclear whether a particular expense is related directly to homestead property, or whether it is an expense related to the general assets of, and administration of, the probate estate itself. This can lead to beneficiaries fighting over who repays expenses, in situations where one beneficiary inherits a homestead property, and the other inherits a non-homestead property.

What About Attorneys Fees?

Courts will look to see if the expenses being recovered are directly tied to the homestead estate.

In a recent case, the court held that attorneys fees that are incurred to generally administer the estate, were the estate’s responsibility–they were not expenses that were tied directly to the upkeep or maintenance of the homestead property  itself, even though the legal assistance rendered, related to that homestead property. .

The process of administering a home, inheriting it, possibly selling it, partitioning it, and everything else that happens to a homestead property in probate court, takes some legal advice and guidance.

Non-homestead-inheriting beneficiaries should understand from the outset, that as of now, these expenses are considered general probate administration expenses–even if that legal advice is related to the homestead property, because legal advice is not considered upkeep or maintenance or repair of homestead property.

Protect your inheritance in probate court. Call the West Palm Beach probate attorneys at The Law Offices of Larry E. Bray today.

Source:

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0700-0799/0733/Sections/0733.608.html