When someone dies, their debts must be paid before their probate property can be distributed to their heirs and beneficiaries. The estate’s personal representative handles this complex process.
If you are a personal representative managing an estate, talk to a probate attorney about paying a decedent’s bills in Pinecrest. At The Florida Probate and Family Law Firm, we can provide sound guidance based on years of experience helping people navigate probate.
Creditor Notification Is the First Step
A personal representative must notify creditors of the decedent’s death and inform them of how to submit a claim against the estate. The identities of many creditors will be revealed as the personal representative receives credit card statements and bills in the decedent’s mail.
Not all creditors send regular statements, so the personal representative must notify unknown creditors. Florida Statutes § 732.2121 requires the personal representative to publish a notice in the newspaper. The notice must inform creditors that the decedent’s estate is in probate and provide the information a creditor needs to file a claim against the estate.
The notice to creditors must appear once a week for two consecutive weeks in a newspaper in general circulation where the decedent lived. Creditors have 90 days from the publication date to file a claim against the estate. Personal representatives should work closely with a Pinecrest attorney to ensure creditor notification responsibilities are carried out in accordance with the law.
How Are Decedent’s Debts Paid?
Family members are not responsible for a decedent’s debts unless the debt is a joint obligation or the family member also signed the loan document. A personal representative should not pay a decedent’s debt out of their personal funds.
Any debts the decedent left must be paid out of property in the estate. Any cash in checking and savings accounts that were solely in the decedent’s name can be transferred to an estate account and used to pay the decedent’s debts. If the decedent had brokerage accounts that did not have a named beneficiary, the holdings can be sold to raise cash to pay debt.
When there is not enough cash in the estate to pay all its debts, the personal representative may have to sell some estate property. Some of the estate property may be exempt from sale to satisfy creditors. A probate attorney in Pinecrest can advise a personal representative about choosing property to sell to raise cash to pay an estate’s debts.
Some Creditors Have Precedence
A personal representative should wait for all claims to be submitted before paying any estate debt. The estate must file the decedent’s last tax return and an estate tax return, and the extent of this liability should be known before any creditors are paid. If there may not be enough property in the estate to pay all creditors, a personal representative must pay debts in order of priority set by law.
Costs of estate administration and attorney’s fees must be paid first, then funeral expenses up to $6000. Taxes and reimbursement of funds paid to the decedent through Medicaid and other public assistance are next in line. Medical expenses, a family allowance, and child support arrears must be paid next in that order.
All other debts can be paid after the priority debts have been satisfied. Low-priority creditors sometimes try to negotiate a discounted amount to receive their money faster, but a personal representative should avoid agreeing to this before speaking with a Pinecrest attorney.
Consult a Pinecrest Attorney About Settling a Decedent’s Debts
If you are an estate’s personal representative, you must pay the decedent’s debts before beneficiaries can receive their probate property. Our attorneys can advise you about paying a decedent’s bills in Pinecrest and every other aspect of estate administration. Contact our firm today.