Monday, September 9, 2019

Probate Fees and Costs in Florida - Glad you asked!


Thanks to Veronica Baxter, a writer, blogger, and legal assistant working primarily for Philadelphia civil appeals lawyer Todd Mosser, Esq., for putting together this article. 

Attorney Fees for Probate in Florida

Prospective clients invariably ask, how much will probating a will cost? The answer is, it depends. This article will tell you the potential fees relative to the size of the estate and define ordinary and exceptional legal services.

Attorney’s fees are usually the largest expense in probate. The attorney for the personal representative of an estate is entitled to “reasonable compensation from estate assets.” The attorney is paid from the assets of the estate, not by any individual.  Although the attorney and the personal representative will sign an agreement regarding fees, the court can override that agreement if it deems that the fees are not “reasonable.”

Attorney Fees for Probate Must Be “Reasonable”

The issue of whether attorney fees are reasonable does not often arise in Florida because Florida code provides guidance on fees for “ordinary service” based upon the value of the estate:

1.    Estate valued $40K or less - fee $1,500
2.    Over $40K to 70K - fee $2,250
3.    Over $70K to $100K - fee $3K
4.    Over $100 to $1M - fee $3K 3% estate value over $100K
5.    Over $1M to $3M - fee $30K plus 2.5% estate value over $1M
6.    Over $3M to $5M - fee $50K plus 2% value over $3M
7.    Over $5M to $10M - fee $90K plus 1.5% value over $5M
8.    Over $10M - fee $165K plus 1% value over $10M.

But there are circumstances under which this statutory scheme produces unreasonable attorney fees.

Unreasonable Attorney Fees for Probate in Florida

Let’s say the Smith estate is comprised only of $10,000 in a bank account, and the Jones estate is comprised only of $1,000,000 in a bank account. The work involved in probating these two estates is comparable, but the Smith attorney would receive $1,500, and the Jones attorney would receive $30K. Is it reasonable for the Jones attorney to be compensated so much more than the Smith attorney under the statutory scheme?

Probably not. It is not mandatory that the statutory fee be paid, and under these circumstances, the personal representative and the attorney should discuss what fee is reasonable prior to signing a retainer agreement. Many estate attorneys use a flat-fee system based upon the work required to avoid any unfairness arising from the statutory scheme.

The Florida Statutory Scheme Applies to “Ordinary” Services

Ordinary legal services are typically included in the base probate fee and are services such as:

     Review and analysis of testamentary documents;
     Explanation and advice regarding testamentary documents;
     Preparation of any court filings;
     Arranging for the appointment of the client as personal representative (PR);
     Preparation and service of the required notice upon interested persons;
     Advising PR regarding obligations to the court, interested persons;
     Advising PR regarding procedural requirements;
     Advising PR regarding duty to locate, protect, insure, and otherwise manage assets of the estate;
     Advising PR regarding the prudent investor rule;
     Advising PR about duty to the estate’s creditors;
     Advising PR about clearing title and tax liens;
     Advising PR about ethical responsibilities such as avoiding self-dealing, conflicts of interest;
     Advising PR of duty of impartiality and obligations to creditors and beneficiaries.

Attorney Fee for “Extraordinary” Services In Florida

What is “extraordinary service”? This varies case-to-case but might include any unanticipated work that arises such as:

     Will contests;
     Will construction;
     Court proceedings for determination of beneficiaries;
     Contested claims;
     Elective share proceedings;
     Apportionment of estate taxes;
     Proceeding for the substitution or removal of a personal representative (PR);
     Objection to accounting or other act of the PR;
     Any other adversarial proceeding or litigation by or against the estate or the PR.

Fees for services such as providing tax advice, preparing tax returns for the estate, and selling any real property might also be considered extraordinary.

In January of 2018 a Florida court determined that the following were not “extraordinary services:”

     an outside attorney locating 53 interested persons for the purpose of notice;
     an outside attorney striking a late claim;
     an outside attorney’s review of an income tax return that was already reviewed  by the personal representative and a CPA;
     outside attorney’s paralegal performing administrative secretarial work such as preparing mailings, processing paperwork, scheduling conferences, and hearings.

The court held that “while parties have the right to employ as many lawyers as they choose, the Court will not assess lawyer fees for or against any party for more than one lawyer for a matter in which no more than one lawyer is required.”

Other Costs in Probate in Florida

Costs would include the cost of items such as court filing fees and publication fees, as well as the cost of actions such as accounting fees if needed.  These can vary widely depending upon the complexity of the estate.

Every probate matter will incur the filing fee for the filing of the Last Will and Testament and the Notice of Administration.

Is Probate Necessary in Florida?

Whether it is necessary to probate a will depends upon the value and complexity of the estate as well as the nature of the assets of the estate. If an estate has no real property and the only assets in the estate are exempt from creditors’ claims or don’t exceed the amount of final expenses, probate may not be necessary.  This is called disposition without administration.  In this case, you can avoid paying attorneys fees for probate.

Certain assets do not need to be probated under Florida law. For example, if the decedent owned a car, title to that car can transfer to heirs without being probated. If the decedent owned property as a joint tenant, the property passes to the other joint tenant automatically, such as when a married couple owns real property or a joint bank account. Assets for which the decedent designated a beneficiary such as a bank account, a retirement account, and life insurance proceeds pass automatically to the designated beneficiary.

Also, for “small estates” (those worth $75,000 or less) the probate process is streamlined pursuant to summary administration.

About the Author
Veronica Baxter is a writer, blogger, and legal assistant working primarily for Philadelphia civil appeals lawyer Todd Mosser, Esq.


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