Your Personal Representative is the person you select to administer your probate estate after you pass on. Often referred to as an “executor” in states other than Florida, a Personal Representative must be named in your Last Will & Testament. Once your Will is admitted to probate, the court issues “Letters Testamentary.” This is the document that authorizes your Personal Representative to begin acting on behalf of your estate.
Selecting a Personal Representative requires careful thought. You should think about the breadth of the tasks he/she will be required to do; the person’s capabilities; and even how your choice may impact your family’s dynamics once you are gone.
Be sure to include back- up Personal Representatives, just in case your first choice is unable or unwilling to serve when the time comes. Most people select a family member or a friend, but a third-party Personal Representative, such as an attorney or a trust company, may be named. If you have not named a Personal Representative, or if the person you named cannot serve and you have not named a back-up, the court will appoint a Personal Representative to administer your estate.
Here are key issues to consider as you assess whom is the most appropriate person for this important job:
Florida Requirements
Under Florida Statute 733.303 a Personal Representative must have these qualifications:
- Has not been convicted of a felony.
- Age 18 or older.
- Has not been found guilty of abusing, neglecting or exploiting an elderly or disabled person (no matter where the offense occurred).
- Must be mentally competent to serve.
- Residency: The person must be a Florida resident, or if not a Florida resident, must be closely related to you by blood or by an existing marriage.
Responsibilities of Your Personal Representative
Your Personal Representative’s duties fall into the following broad categories. He/she must document all the steps below and provide periodic accountings to the Probate Court.
Immediate Tasks
Your Personal Representative must locate and file your Will with the probate court. Probate is a court proceeding and your Personal Representative must select an attorney to handle court filings, give advice, and assist with the administration. Your Personal Representative must obtain copies of the death certificate, and secure your home to protect it from theft – and that may even include protection from family members who have access to the house. The post office should be instructed to stop and forward mail.
Inventorying Your Assets
After you pass on, your Personal Representative must identify your assets. This process may involve going through your paperwork, your electronic files, contacting financial institutions, etc. An inventory of your assets must be created, a value assigned to each asset, and the inventory submitted to the probate court. Obtaining a date-of-death value for some assets such as bank accounts is fairly straightforward, but more research may be necessary to determine the value of other assets, such as vehicles, artwork, etc.
Identifying and Paying Creditors
Your Personal Representative will be responsible for paying the debts of your estate out of the estate assets. He/she must identify known creditors and satisfy those debts, including any required taxes for the estate, and final income taxes for the decedent. The Personal Representative must also alert creditors he/she may not know about: this is done by publishing a notice in a newspaper that circulates in the county in which the decedent’s estate is administered. Creditors have three months in which to file a claim after notice and/or publication.
There can be negative repercussions if your Personal Representative fails to pay creditors. For example, if he/she has made distributions to beneficiaries and thereafter a creditor who has not received proper notice files a claim, the Personal Representative can be held personally liable for the debt. When our firm assists with administering a probate estate, we get a credit check from one of the major credit bureaus. This due diligence allows us to discover debts that were unknown even to the family. For example, it is not uncommon for us to discover that the decedent was a guarantor for a grandchild’s or other family member’s car loan or student loan.
Managing Assets and Paying Beneficiaries
Your Personal Representative is responsible for managing the assets of your estate. This process may include closing down accounts, selling real property, etc. Only when all debts have been settled can the Personal Representative make distributions to beneficiaries, in accordance with the terms of the Will.
Personal Qualities, Family Dynamics
Choose someone you know to be reliable, trustworthy and organized, with sufficient time to manage your estate in a timely manner. Keep in mind, though, that your Personal Representative is permitted to hire professionals to do the tasks he/she lacks the time or ability to perform personally. Professionals may include attorneys, accountants, appraisers, etc. They are paid from estate funds.
Being named as someone’s Personal Representative should never come as a surprise! Definitely ask the person who you intend to name if he/she is willing to do the job, and give them an overview of what to expect and future responsibilities.
Consider the impact on your family when you choose one family member over another. We have seen situations where adult children start to resent the sibling who is in charge of administering a parent’s estate and is in control of their inheritances. Also, the Personal Representative may be making choices that have a great emotional impact on the family – funeral arrangements, for example.
Discussing your choice and the reasons for it with your family members can go a long way to avoiding these problems and fostering family harmony when you are gone. While it is natural to worry that one of your children may feel slighted if not designated as Personal Representative, remember that serving in this capacity is a serious job and a time-consuming one. In the final analysis, it is wise to select the person whom you believe is really the best one to juggle all the responsibilities.
Pros and Cons of Co-Personal Representatives
Florida law permits you to appoint co-Personal Representatives. This may be a good approach if the two individuals have different talents suited to handling different administrative tasks. For example, your retired adult son may have the leisure time to go through your paperwork, and another son, an accountant, might be the best one to handle required tax filings.
That said, naming multiple Personal Representatives can sometimes develop into a “too many cooks in the kitchen” situation and lead to conflict. Let’s say one of your properties must be sold in order to generate cash to pay creditors. If you have two Co-Representatives who you have required to act unanimously, what happens if they can’t agree? If on the other hand you have authorized them to independently make binding decisions, their relationship could still be threatened if one goes ahead and sells a particular proprty.
Long story short, you should consider naming co-Personal Representatives only if you are absolutely certain that they will be able to work together amicably. This is an issue you should thoroughly discuss with your prospective Co-Personal Representatives and with your estate planning attorney.
Your Personal Representative May Be A Beneficiary
We are often asked by clients if one of their beneficiaries under their Will can serve as Personal Representative. The answer is yes, so long as the person meets all the Florida legal criteria noted above. However, the beneficiary acting as Personal Representatice must at all times act based on the best interest of all beneficiaries, not favoring him/herself or any beneficuary over others. If this rule is violated, the Personal Representative can be sued for damages by the other beneficiaries.
Your estate planning attorney will be able to help you think through all these issues, so that you make the best choice when selecting your Personal Representative. If you would like help in planning your estate and making this important decision, call The Karp Law Firm for an appointment at (561) 625-1100.
