Episode #98
Florida Probate Q&A: Wills, Property, Costs & More with Nicole Bell Cleland
Nicole Bell Cleland of Legacy Protection Lawyers returns to answer some of the most common questions that come up around Florida probate and estate administration. She and John discuss what happens when someone dies without a will, special considerations for blended families and inherited property, when an attorney is required, and what the probate process may cost. Legacy Protection Lawyers: https://www.legacyprotectionlawyers.com/ Helpful Information: PFG Website: https://www.pfgprivatewealth.com/ Contact: 813-286-7776 Email: info@pfgprivatewealth.com Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents. Speaker 1: Welcome into another edition of Retirement Planning Redefined with John and Nick, financial advisors at PFG Private Wealth. And Nick is off again on this episode as we have Nicole Cleland joining us again to follow up with a Q&A conversation, some questions and answers about the probate conversation we just had on our prior podcast. So John's going to jump in and toss out some of the most frequently asked questions that these guys get when dealing with this. And of course, if you need some help, go and check them out online at legacyprotectionlawyers.com. That's legacyprotectionlawyers.com. We'll have a link in the show descriptions along with John and Nick at pfgprivatewealth.com. But first, Nicole, welcome back. Nicole Cleland: Thanks for having me. Speaker 1: Absolutely. Great stuff last time, so thanks for being here. And of course, John, thanks for being here, buddy. John: Yeah, yeah. Having a good time here. School year started for the kids, which has been fun. So kids are excited to go back to school. I'm sure parents are a little excited too to have their own little break, but all is good. Speaker 1: For sure. Well, we had some good response to the prior podcast episode, and so you guys deal with this stuff a lot. Obviously you guys work as a team as well. And so what are some of those top questions, John? I know you got a couple we want to cover on this episode, so take it away. John: Yeah. So one question I get from clients and some stuff I'm curious on. So one is, and we try to avoid this by doing proper planning upfront, but Nicole, what happens if someone doesn't have a will, or there's no beneficiary listed on an account, or it's not listed correctly? Nicole Cleland: Yeah, so if someone dies what we call intestate, so they had not signed a will prior to their passing, then we have to look to Florida law, Florida's intestacy statutes to find who their intestate heirs are. And the idea behind the law is to reflect what most people would naturally want. And if you think about it under Florida intestacy laws, if you're survived by a spouse, then usually 100% goes to the spouse. If no spouse then to your children, if no children are descendants, then it goes back up to parents and then out to siblings. Obviously with blended families, stepchildren, half siblings, that can vary a little bit, but Florida law tries to reflect what most people would had intended had they created a will themselves. John: Okay. So in essence, the courts try to make their best effort to do who gets what? Nicole Cleland: Well, not the courts so much as the law. John: Oh, okay. Nicole Cleland: And what I mean by that is, if you passed away tomorrow and you had three children and you were estranged from one of them, but you had not signed a will disinheriting that child, then under Florida law, that child's going to take an equal third. The court has no discretion on that. So the estrangement of the child has no bearing. It's just a matter of what Florida law states. John: Gotcha. And then you mentioned blended families, something that does come up every once in a while, and I think most people miss it. Tell us about elective share. Nicole Cleland: Yeah, so in Florida you can, and actually most states, all but one, I think, have a similar law that states that you can leave your assets to whomever you want. You can disinherit your children, you can disinherit parents, but the one person you cannot disinherit is your spouse. So in Florida law, your spouse is entitled to a minimum of 30% of your overall estate, not just your probate estate. So that would include real estate, bank accounts, life insurance. Well, depending on the life insurance, but it can vary. But essentially, if you had any desires to leave your spouse with nothing, then they're going to be a little bit more trickier than you may have thought. John: And I think maybe this could be a deep dive session, but if you own assets 50/50 with your spouse, how much is considered theirs and yours in this, if it were to come up? Nicole Cleland: Oh, that's a good one too. Hard-hitting questions, John. So that's where we can sometimes go a little bit beyond ownership and we look at the character of the asset. And what I mean by character, I mean, is it separate property? Is it community property? How is the ownership on that jointly owned property? And really digging into the facts. So this is why in the very first, the last session we had, I mentioned why that due diligence period prior to opening a probate is so important is you can look and ask these types of questions. So I would say for a lot of blended families, for a lot of married couples, actually, most married couples own things in joint name. And sometimes when you have blended families, if there's not proper planning, I've seen unintentional disinheritances. So you leave everything to your spouse, but then your spouse leaves everything to their children from their first marriage. Is that what the first today spouse wanted? Probably not. John: Yeah, unfortunately I've seen that happen as well. So definitely do your planning whether- Nicole Cleland: Yes, especially with blended families, for sure. John: Yeah, agreed. All right, another question. Something you mentioned last week, we were talking about homes, and I think you mentioned where someone might want to keep the asset. So let's say someone passes away, the kids say, "Hey, I want to keep this house." How does that pass to the beneficiaries? Is there any specific documentation? Nicole Cleland: So it again might boil down to how did it pass to these beneficiaries? Are we going through a probate proceeding where a personal representative is in charge and has the final say-so? If that is the case, then that personal representative decides. They've got the ultimate decision on whether or not a piece of real estate or any asset is liquidated or transferred what I call in kind. Meaning if it was received as a piece of real estate, it'll be distributed as a piece of real estate. So it can depend on the situation. Now, if you've got maybe a mom who added her two kids to the deed before she died, and now these two kids own the property 50/50 and one of them wants to keep it, one of them wants to sell it, how do you force the hand of the one that wants to keep it? And sometimes it requires court action if they can't agree. So it very much can depend on how the property was inherited and really who has the legal authority over that asset. Does that answer that question there? John: It does. So it depends on how it was titled initially and did it go through probate officially or putting it on the deed bypass probate. Nicole Cleland: Right, right. John: Okay, got it. And then what about some question some people will ask is, do you need an attorney to help you with the probate process? Nicole Cleland: So in Florida- John: And what is the cost? Nicole Cleland: Yeah, always the bigger question there. So with a formal administration in Florida, you do have to have an attorney. And I understand why, and it's because there are so many rules regarding probate and those administrations that you really do need not just an attorney, but an attorney that does administrations to do it well. And that being said, with a summary administration, you can do it on your own in the sense that you don't have to have a lawyer. Oftentimes though, if I'm getting a call that someone who's started the summary administration proceeding and they can't get across the finish line, it takes a lot more work for an attorney to clean it up. So unless you feel very confident in your abilities and maybe even gone to a legal aid center to help you fill out the summary administration paperwork, it can be tricky to do, especially if there's creditors involved. But in terms of costs, it definitely can depend on the scenario. And for the most part, when it comes to formal administrations, there is a statute that outlines what is reasonable compensation for an attorney for a personal representative. And it roughly falls a percentage schedule where on the first million, it's about 3% of the probate assets. And then as the millions go up, the percentage typically goes down. And that attorney fee schedule actually is comparable to a personal representative's presumed reasonable fee schedule. But that being said, there's a lot of talk about that in the trust and estates world in the sense that even though it's presumed reasonable to charge that type of fee schedule, attorneys don't have to charge it. They can charge hourly or some other type of flat rate fee, as long as of course the client and the personal representative, or excuse me, the personal representative and the attorney agree to it. And then for summary administrations, it can depend, but it's typically a couple thousand dollars to get the final order on those. John: Yeah. Okay. So it sounds like the fee can vary and the best way to do it is plan ahead so you don't have unknown fees upcoming for your beneficiaries or estate. Nicole Cleland: Absolutely. Probate can be avoided, so it just takes some planning. And on top of that, clients can meet with an attorney to try to get an idea if they have to go through this probate process, what exactly would that fee would be? And we recognize, a lot of people want to know at the beginning, what is this going to cost me? So for a lot of our clients, we do agree to some sort of flat rate fee so that we both know at the gate what the fees would be. But in some cases, we really just don't know what those hidden minds might be, and we might have to do hourly. So again, it can depend, and I know that's the famous attorney answer. John: No, I understand. And I'll just tell you from personal experience with clients, forget the costs and fees associated with it. I think the amount of work some of these PRs, personal representatives do, if it wasn't planned correctly. I have one person that was going to about 10 or 12 different banks to see if there were bank accounts and probate took over a year and a half just because of how much was undisclosed and not known. And I think we have to look to the Florida, what is it, Florida Treasury Hunt to see if any unclaimed property as well? Nicole Cleland: Yes, floridatreasurehunt.gov. Yes, for unclaimed property. So yeah, that's where those estates where we don't know a lot can be really, really hard because if the client doesn't know what's there, how can the attorney provide a quote? So it sort of makes sense, but I think for a lot of attorneys, at least I can speak for the attorneys in our office, we try to be fair. We want to be fair to our time and our expertise, but also to the client and the assets there and the beneficiaries. Speaker 1: All right, good stuff. So certainly some top questions and answers there for Nicole. If you have questions of your own, again, please reach out to the team. And of course you can talk to the financial side with John and Nick. You can also talk on the legal side by reaching out to Nicole and her team at legacyprotectionlawyers.com. That's legacyprotectionlawyers.com or at pfgprivatewealth.com. Either way, we'll have those links in the show descriptions, but always, always check for yourself and see how things relate to your specific situation, not only with your finances, but with your legal stuff as well. And with that, we'll say thank you so much for tuning in to Retirement Planning Redefined. Nicole, thanks for being back on the program. Nicole Cleland: Thanks for having me. Speaker 1: Absolutely. John, thanks for being here, buddy. John: All right. Appreciate you. Thank you. Speaker 1: Yes, sir. We'll see you guys next time here on the podcast. Subscribe to us on Apple or Spotify or whatever app you enjoy using, and we'll catch you later.
