When people pass away, their estates often go through a legal process known as probate. This method of distributing assets is common in Florida, with the Office of the State Courts Administrator reporting 8,780 probate filings in fiscal year 2020-2021 alone.
Ancillary probate is an additional process that can be time-consuming and costly. However, there are strategies to avoid ancillary probate in Florida.
Use joint ownership with rights of survivorship
One effective way to sidestep ancillary probate is to hold property jointly with someone else, preferably with rights of survivorship. When one owner passes away, the property transfers to the surviving owner.
Establish a living trust
Creating a living trust is another option. By transferring your Florida property into a revocable living trust, you keep control of the assets during your lifetime while ensuring that they pass directly to your chosen beneficiaries upon your passing.
Certain assets allow you to choose beneficiaries. Examples of these include:
- Life insurance policies
- Retirement accounts
- Payable-on-death bank accounts
By naming the recipients on your accounts, you make it more likely that the funds transfer will go smoothly.
Gift your assets
Another strategy is to give your property away before you die. While this option may have tax implications, it can help ensure an easy transfer of money and goods.
Claim the Florida homestead exemption
If your primary residence is in Florida, you may qualify for the state’s homestead exemption, which protects your home from creditors and probate. You must meet the residency and other eligibility requirements to take full advantage of this exemption.
Use enhanced life estate deeds
Florida allows for using Lady Bird deeds, also known as enhanced life estate deeds. With this type of deed, you maintain control of your property while you are alive, but it automatically transfers to your chosen beneficiaries upon your passing, avoiding probate.
Transfer property to a limited liability company
If you own rental properties or investment real estate in Florida, consider transferring ownership to a Florida-based LLC. By doing so, you can simplify the transfer of ownership and avoid ancillary probate.
The best way to avoid probate depends on your family’s circumstances and where you wish your money to go after your death.