Taxation & Estate Planning

Is my mother?s house protected from probate creditors?

By Long H. Duong

Florida Probate Question of the Day

I recently talked to a prosepective client about homestead laws in Florida.  Specifically:

What happens to a decedent’s homestead in a Florida probate administration that has many or substantial creditors?

I told him that I could secure a Homestead Protection Order so that his mother’s house would pass safely without worrying about the claims of creditors.

Recently, he contacted me for clarification:

I want to make sure I understand that (homestead) classification correctly. I currently do not reside (nor plan to) in my mother’s house, and I was concerned that a legal minor must be residing post-death in order to remain a homestead exemption.  Can you clarify that distinction for me when you get a chance?

Answer:

Constitutional homestead protection is granted to the decedent’s estate and accordingly the heirs of the estate.

If your mother was on the title to the house and it was her principal residence at death, it (the house) enjoys that protection and can be passed on to you and the other heirs free and clear of debt other than debt secured by the house (mortgages, mechanic’s liens etc.) In other words, pay the mortgage or lose the house.

Note also that if you chose to sell the homestead property, the funds received from the sale are also protected!

Credit card debt or medical debt on the other hand, has no effect on the homestead.

The only other caveat would be a Federal IRS lien or liability.  (The IRS can take just about anything)

The fact that you do not intend to move there has no bearing on your right to claim a homestead protection order.

Regarding minors:  Florida Homestead laws forbid a person to dispose of their home to a third party by Last Will and Testament (or any other testamentary document), if that person had minor children at death.

Related posts:

1. Need to refinance mom’s house? You might need probate first!
2. “Quick” Q&A – “What is the creditor period and why do we need to publish a Notice to Creditors?”
3. “Quick” Q&A – “Mom died without a Will, but she really wanted me to have the house…”

Full post as published by WeProbateFlorida.com on February 05, 2010 (boomark / email).