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The personal representative is the person, bank, or trust company appointed by the judge to be in charge of the administration of the decedent’s probate estate. In Florida, the term "personal representative" is used instead of such terms as "executor, executrix, administrator and administratrix."
To qualify to serve as a personal representative, an individual must be either a Florida resident or, regardless of residence, a spouse, sibling, parent, child, or other close relative of the decedent. An individual who is not a legal resident of Florida, and who is not closely related to the decedent, cannot serve as a personal representative.
Individuals are not qualified to act as a personal representative if they are either under the age of 18 years, are mentally or physically unable to perform the duties, or have been convicted of a felony.
A trust company incorporated under the laws of Florida, or a bank or savings and loan authorized and qualified to exercise fiduciary powers in Florida, can serve as the personal representative.
Appointment as Personal Representative
An overview of the appointment, responsibilities and duties of the Florida Probate Personal Representative
D.5. Stage Five: Tax Returns.
Another stage in the proceedings in the estate is the determination of various tax returns that may be required by law to be filed for the estate. There may be many required tax returns. The most common include income tax returns for the decedent which may not have been previously filed, income tax returns for the estate if the estate is required to file during its tax year, and an estate tax return, which is required by law to be filed if the total taxable estate exceeds a certain valuation. In addition, if the estate owns intangibles such as stocks or certain bonds, an intangible tax return may have been required to be filed each year with the State of Florida. You should review the estate assets and estate income with a CPA or accountant to determine which, if any, tax returns are required to be filed. Merely because a tax return is required by law to be filed does not necessarily mean that any tax is due.
D.6. Stage Six: Distribution.
After expenses, including taxes, have been paid, the next level or plateau of the administration is the procedure involving distribution of the estate to the beneficiaries. As your attorney, we will review the terms of the will, or in case there was no will, we will advise you of the provisions of the law that apply in order to identify the persons who are properly beneficiaries of the estate and who are entitled to distribution. We will also calculate the distributive shares after deduction of any taxes which are attributable to each share. Distribution of the assets of the estate then occurs to the persons entitled, sometimes by distributing the assets directly in satisfaction of a bequest, and other times by selling those assets and converting them to cash, and then distributing the cash.
D.7. Stage Seven: Closing the Estate.
Another stage of the estate is closing out the probate. In this procedure the court enters its order discharging you as personal representative after your duties have been completed. In order to accomplish this estate closing, it is necessary to report to the court on all of the legally significant activities which occurred in the estate and to furnish evidence that the creditors have been paid, that certain taxes have been paid, and that the remaining property has been distributed to the persons entitled to that property in proper shares. When this evidence has been presented in proper form, which is again our legal responsibility, the judge will sign an order which discharges you as personal representative and terminates your obligations with regard to the probate.
D.8. Stage Eight: Post-Closing Activities.
The estate is obligated to file for the year in which final settlement occurs a final income tax return. It should be remembered when the estate is closed that the estate may have had taxable income for that year or otherwise be responsible for the payment of taxes, and sufficient funds must be retained by you in order to enable you to pay these taxes that may be due.
E. Your General Responsibilities; Working Together.
As personal representative, in accepting the office and the trust of the estate, you have also agreed to be personally responsible financially for certain matters. Initially, of course, you have personal responsibility for proper administration, investment, and subsequent distribution of the assets of the estate.
Should you fail in this duty you may be sued by any person who has been injured by your failure. More important, however, is certain hidden liability which you have assumed, and of which you should be aware, for the payment of various taxes that were owed by the decedent, or that may subsequently be owed by the estate.
Upon the failure to pay these required taxes, the law permits the Internal Revenue Service, and in some situations, the State of Florida, to collect the taxes from your own assets. This would include the right to freeze your personal bank account or place liens on real estate or other property which may belong to you personally. This, of course, occurs only if you failed to pay taxes from the estate that are required to be paid by you in your capacity as personal representative. It is because of this exposure to items that might otherwise be unknown to you that we should work closely together, and you should permit us to advise you at each level on your duties and responsibilities. Also, if you have any questions, you should not proceed without legal advice.
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Application for appoint as Personal Representative must be submitted and approved by the court before the powers attached to the position (Letters of Administration) are granted. Under certain conditions, the judge may request that the personal representative be bonded ("insured") . This involves submitting an application for bond along with a bond premium.
A bond application requires the prospective personal representative to complete a questionnaire regarding employment (if working), credit, and and criminal background history. Once the bond is issued, it is submitted to the court and the judge will issue Letters of Administration, a document that empowers the personal representative to begin conducting the affairs of the estate.
If you are appointed as personal representative for an estate you must be aware of the duties and responsibilities to which you are entrusted. The functions described below are often referred to under the term "settling the estate." This is a summary of the role and many of the duties a personal representative undertakes.
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A. First and foremost, a Personal Representative is a Fiduciary.
A personal representative is classified in law as a "fiduciary." A fiduciary is a person who has been selected for a position of special faith, trust, and reliance.
B. Qualification To Serve As Personal Representative.
By accepting the position of personal representative you are stating that you qualify to act as personal representative in accordance with Florida Statutes §§733.302 - 733.304. Among these qualifications you are stating that you are not a convicted felon, you are over the age of 18, and you are a resident of the state of Florida. If you are not a resident of the state of Florida, you may still qualify under Florida Statute §733.304 if you satisfy certain criteria. Please let us know if you are not a resident of Florida so that we may properly evaluate your eligibility.
C. Your Duty To Preserve Assets.
From the time, and not before, the "Letters of Administration" are issued to you, until final distribution is made, you are entitled to possession and control of all of the assets of the estate. Your duty is first and foremost to protect and preserve the assets. You must also see that the assets are invested in a prudent and cautious manner.
The persons to whom you owe these duties are, first, any creditors of the estate, and second, the beneficiaries of the estate. If your duties are not properly or competently performed, you may have to answer to any of these persons who have been harmed as a result.
D. Stages of the Estate Administration.
Several overlapping stages occur during the estate administration process:
D.1. Stage One: Commencement of the Estate: Letters of Administration.
The process of probate, or administration of the estate, or settlement, depending upon the term you prefer, begins with filing the will for probate, preparation and filing of a petition for probate, and after various procedures which are our responsibility, the judge will sign "Letters of Administration," certified copies of which you will receive. The Letters of Administration are evidence of your legal authority to act as personal representative.
D.2. Stage Two: Notices to Creditors and Heirs.
Once the administration procedure has begun, it will pass through several additional stages or plateaus. The next stage of the administration, after the Letters of Administration are issued, is that of giving notice to those persons who are involved or interested in the estate. Beneficiaries of the estate will receive the required notice by certified mail. Creditors are given legal notice by publishing a legal notice in the newspaper, but creditors whose names and addresses are known or reasonably ascertainable must be served with the notice directly.
D.3. Stage Three: Inventory; Securing and Managing Assets.
The next stage of administration is that involved in identifying, collecting, inventorying, valuing, securing and investing the assets of the estate. An important part of making certain that assets are secure is arranging for adequate insurance coverage for tangible personal property or improved real property. A list of all of the assets and their values must be filed with the court in the form of an inventory, and, if the estate is of a size sufficient to require the filing of an estate tax return, similar information must be provided for the State of Florida and for the Internal Revenue Service. As your attorney, we will work with you in preparing the inventory list, obtaining the asset values and preparing the necessary documents that need to be filed.
Throughout the estate proceeding, management of the assets is an important concern of the personal representative. Management of the assets includes investment of the assets, whether in bank accounts, government bonds, or other prudent forms of investment, to the extent that the estate has excess cash. A further and important consideration is liquidity management. The personal representative is required to sell assets or borrow money on behalf of the estate to meet the cash requirements as they arise, if cash available to the estate is not otherwise sufficient. Cash requirements for the estate include the payment of creditors, the payment of expenses of administration, and the payment of taxes.
D.4. Stage Four: Creditor Claims.
During the early period of administration (within approximately the first four months) any person having a claim against the estate as creditor is required to file the claim in the court. At the end of this initial period you will review any claims filed to determine that each appears to be valid and then promptly arrange for and make payment of all valid claims to avoid interest expense. Any claims not filed in this time period are not legal obligations of the estate, and in most instances cannot be legally paid.