After you die, you may have money, property, and other assets that were in your own name. Generally the assets which did not automatically become someone else’s upon your death are part of your probate estate. Many individuals attempt to make sure that there are no assets in their probate estate when they die. This is often done with the help of a Florida Estate Planning Lawyer and can often include Florida Revocable Trust as well as reviewing ones beneficiary designations.
A will is where you would typically define who will be the personal representative or the Executor of your estate. While the many estate plans in Florida will not need a PR or executor, many individuals do not fully plan to deal with all of their assets and a Florida executor is needed. Generally the executor is someone in whom you can put the utmost trust. Your Executor will be the person in charge of making sure all your assets including your money are gathered, kept safe and distributed according to state law and your desires. There are certain people who will get paid before any distributions are made. Generally, the PR, court costs, and lawyers are paid first, then the burial expenses are paid (up to $6000 is a priority claim). After these bills are paid, the creditors are paid and only after the bills are paid, do the beneficiaries receive what is left from the probate estate.
Florida Statute 733.707 discusses the priority that claims are paid. In general they are paid in the following order:
Class 1 – Costs, expenses of administration, and compensation of the personal representative and their attorneys fees
Class 2 – Reasonable Funeral, interment, and grave marker expenses, whether paid by a guardian, the PR or any other person not to exceed $6000. (Additional costs are treated as an unsecured creditor.
Class 3 – Debts and taxes with preference under federal law.
Class 4 – Reasonable and necessary medical and hospital expenses of the last 60 days of the last illness of the decedent, including compensation of persons attending the decedent.
Class 5 – Family allowance.
Class 6 – Arrearage from court ordered child support.
Class 7 – Debts acquired after death by the continuation of the decedent’s business, but only to the extent of the assets of that business.
Class 8 – All other claims including those founded on judgments or decrees rendered against the decedent during the decedent’s lifetime, and any excess sums allowed in the Class 2 and Class 4 claims.
After paying the expenses in Class 1 – Class 7, if the estate is insufficient to pay all of the Class 8 claims, the Class 8 claims shall be pro-rated. If the probate estate does not have sufficient assets, any revocable trust’s assets can be used.
How your Executor determines your heirs, should have been designated by you while you are alive through a will. The will is governed by Florida state law which mandates your Executor has a fiduciary duty to distribute your money and assets to whomever you state in your will should get the money or assets. The fiduciary duty is one of the highest duties one person can owe another. The fiduciary duty imparts on the person owing the duty (your Executor) the obligation of good faith, impartiality, honesty, and diligence. This basically means your Executor must act as if he or she was you making the decision while you were alive.