The probate process often comes at a cost. The general cost of probate differs depending on the type and value of the property. Generally speaking, the higher the value of your estate property, the higher the cost of the probate process.
Let us see some of the common probate costs and how to avoid those that are unnecessary.
Court fees are usually determined by Florida state laws and often range between a few hundred to a thousand dollars. In most cases, the fee will largely depend on the complexity of the property and how many forms are required to be filled.
This is also another area where you will incur some costs during the probate process. The fees charged by the attorney are dictated by Florida state laws and determined just the same way as the personal representation feels. A good Upchurch Law Estate and Probate Litigation Attorney will ensure that the fee charged is commensurate to the work done.
These fees are also decided by the state. However, there are instances where decedents can specify in their wills how much their appointed executor (personal representative) should be paid. The state will only dictate the executor fee if the will is silent regarding that provision.
Accounting fees generally differ as per the overall value of the estate property and type of asset. However, a small estate that owns 20 different bonds and stocks might attract more accounting fees compared to a larger estate that owns only a basic residence, a CD and a bank account.
Accounting fees may include the preparation and filing of tax returns (if the state is taxable). In some cases, an Upchurch Law Estate and Probate Litigation Attorney will assist in the preparation and filing of returns.
Your executor or personal representative will also be required to deposit and a determined amount by the probate judge prior to his or her appointment. It is the estate that usually pays the money. Some probate judges will require the bond to be posted even if the estate has minor beneficiaries.
Appraisal and business valuation fee
The probate court will need business interests, date-of-death values of real estate, personal property such as cars, jewelry, boats, artwork among others. The appraisal fee for personal property can range from a few hundred dollars to several thousands of dollars.
How to avoid unnecessary probate fees
Transfer property to a trust
Revocable living trusts were started to help people bypass the probate process. Contrary to the property listed in a will, all property in a trust is not probated – meaning it is directly passed to your beneficiaries. All you will have to do is create a trust document and transfer the property title to the trust.
Set up payable-on-death registrations
Payable-on-death registrations give you an opportunity to name or more hairs of the account to avoid the probate process. It is free and quite easy to create payable-on-death registrations.
Nonetheless, you will be required to add the ability to name the beneficiary feature – something that most banks, credit unions and brokerage firms allow.
Make tax gifts
Making tax gifts help you to avoid the probate process in the sense that you no longer own any property after your demise. The latest regulations allow people to allocate their beneficiaries up to $15,000 per person annually without a gift tax penalty.
Use joint ownership
If you jointly hold property such as vehicles, stocks, bank accounts, and homes, then the title of the property will automatically be passed to the joint survivor when you die.
In a nutshell, the probate process can be a costly affair. It is therefore important to explore all ways to try and save money by avoiding unnecessary costs.