In the days of Google searches, I don’t know why I am still surprised when a potential client asks: “Can we proceed with a Summary Administration?” Still, as I’m sure my medical doctors experience when I arrive listing symptoms and my incorrect conclusion of what I believe my ailment to be, there’s more to summary administration than what you may be able to learn through your Google search. So, what is the difference between a Summary Administration and a Formal Administration?
The Basics:
Both a Summary Administration and a Formal Administration are needed when a person dies owning assets in their own name that do not have a payable on death provision or joint owner (as in a bank account) or they pass owning real property that does not have a survivorship provision (as in a spouse who owns property together in both names as husband and wife, or, as “joint tenants with rights of survivorship”). Both of these are cases that are opened with the Court and the individual bringing the case (known as the Petitioner) asks the Court to enter an order distributing the assets to the rightful beneficiaries.
Summary administration can only be used when the total value of decedent’s assets subject to probate are $75,000 or less, or when the decedent has been dead for more than two years. Formal administration is used for all other estates or whenever a personal representative is required for other purposes.
Which Administration type should I choose?
The answer is it depends. There are important variables to consider when making a choice. Every probate case is different, even if the differences are small. For example, some cases require letters of administration, making summary administration not a viable option.
To get better acquainted, let’s consider the steps, costs, time frame and some pros and cons to each type of Administration.
Summary Administration:
Steps:
- Preparation of the documents.
- Obtaining execution of all documents by all beneficiaries.
- Publication of the notice to creditors (if it has been less than 2 years since the Decedent’s date of death, and if there is homestead property)
- Determination of homestead (if applicable).
- Distribution of the funds to creditors and beneficiaries per court order.
Costs and Time Frame:
The current court costs are between $400 – $500 (although there are some publication costs that range up to $300; Miami Dade is $65), and other expenses that can increase this amount (if original additional death certificates are needed, translation costs, certified copies of other state’s or countries’ legal documentation, etc). The approximate time frame is 3 to 6 months – unless extraordinary circumstances occur, like a will contest, in which case, the matter would need to be converted to a Formal Administration. Note: Decedent’s estate cannot be closed while litigation is pending.
Pros:
- Shorter time frame than formal administration: 3 to 6 months compared to 6 – 18 months.
- Less expensive than formal administration.
- Usually less complicated than formal administration since the Court requires less documentation.
Cons:
- A personal representative is not officially appointed: In Formal Administration, the appointed Personal Representative is given authority to request all the information he or she needs regarding the decedent’s assets. Without this authority, requesting information regarding the decedent’s assets might challenging since institutions are legally bound to withhold information unless you are the Personal Representative. Even if there is a will naming a Personal Representative, it is not until a Court enters an order appointing this individual, that he or she has the ability to act as the Personal Representative.
- No Letters of Administration are provided: if you need Letters of Administration for any reason (i.e., speaking with a bank or mortgage company, dealing with the IRS, selling a property before it is distributed, etc), or if the estate will be subject to litigation, a summary administration will not suffice.
- All assets need to be accounted for before filing.
Formal Administration:
Steps:
- Preparation of the documents.
- Obtaining execution of all documents by all beneficiaries.
- Appointment of Personal Representative.
- Publication of notice to creditors.
- Filing of the inventory of decedent’s estate.
- Marshaling all liquid assets and depositing same into a restricted depository (as required by the Court) in the name of the Estate.
- Determination of homestead (if applicable).
- Preparation of Final Tax Returns (if applicable).
- Sale of Property (if applicable)
- Payment of Creditors.
- Distribution of the assets to beneficiaries.
- Closing of the Estate.
Costs and Time Frame:
The current costs are $500+ (including publication costs, see above) The approximate time frame is 6 – 18 months unless extraordinary circumstances occur: i.e. litigation. The estate cannot be closed while litigation is pending.
Pros:
- A Personal Representative is appointed: This individual (or these, if Co-Personal Representatives are appointed) has the authority to secure information about the Decedent’s assets or debts.
- Letters of administration are provided: Banks and financial institutions will accept letters of administrations although some banking institutions require separate orders to turn over the Decedent’s assets.
- The Personal Representative has the authority to deal with creditors, including negotiating claims and striking any that are not valid.
- When there is litigation, the Personal Representative is the only individual that has standing to defend the Estate. This cannot be handled in a Summary Administration.
Cons:
- Longer proceeding than summary administration: 6 to 18 months compared to 3 to 6 months.
- More expensive than summary administration.
- More work required than in summary administration.
To determine which Administration type is the best for your case, you must make an informed choice, which means sitting down with a Probate attorney, discussing all of the facts, and receiving solid legal advice.
To schedule your initial consultation, contact us today at: (305) 477-1111 or fill out our Probate Questionnaire right on our website by clicking HERE. Information provided on our Questionnaire is sent via a secure method so your private information always remains safe.
