A Florida probate does not transfer the lake house in Michigan or the apartment in New York; without planning, each state gets its own proceeding, its own lawyer, and sometimes its own tax.
Key Takeaways
- Real property is governed by the law of the state where it sits, so property in another state titled in your own name means a second, ancillary probate there, and possibly that state’s estate or inheritance tax.
- Deeding the property to a Florida revocable trust, holding it in an LLC, or using that state’s transfer-on-death deed can avoid the second probate, but each has its own transfer tax, title insurance, and due-on-sale questions to check first.
- Your former state may dispute that you ever left; a recorded declaration of domicile, a homestead application, and documents that recite Florida domicile matter more than most people expect.
Many of my clients arrived in Florida from somewhere else and kept a piece of it: the lake house in Michigan, the apartment in Manhattan, the farm in Pennsylvania that has been in the family for generations. Others are Floridians who bought a place near children in Atlanta or Denver. Either way, the law of the state where the property sits governs what happens to it at death, and a Florida plan that ignores this leaves the family with a second court proceeding in a second state.
Land is governed by the law of the state where it sits
A Florida probate transfers Florida property. It does not transfer title to a cabin in North Carolina or a condominium in New York, because a Florida court has no authority over land elsewhere. If you die owning real property in another state in your own name, your family opens an ancillary administration there: a second probate, in that state’s court, under that state’s rules, with a lawyer licensed there, and with its own fees and its own calendar. Florida does the same in reverse. A nonresident who dies owning Florida property gets an ancillary administration under Fla. Stat. § 734.102, or a shorter procedure under § 734.1025 if the Florida holdings are small. The second proceeding is rarely cheaper than the first.
The other state’s death tax can apply as well. About a dozen states and the District of Columbia tax estates or inheritances, and most of them reach real property within their borders regardless of where the owner lived. A Florida resident’s house in Massachusetts or Oregon can produce a tax bill from that state even though Florida itself has no estate tax.
A revocable trust avoids the second probate, if the deed is done right
The usual solution is to deed the out-of-state property to your Florida revocable trust. The trustee holds title, and nothing passes at death that needs a court. The deed itself, though, is not a Florida document. It is prepared under the law of the state where the land sits, with that state’s acknowledgment, recording requirements, and, in some states, a transfer tax return or exemption claim. Three things need checking first: whether that state taxes a conveyance to a revocable trust; whether the title insurance continues to cover the trustee, which the current standard policy generally provides and older policies may not; and whether a mortgage has a due-on-sale clause, which federal law bars a lender from enforcing against the transfer of a residence to a revocable trust in which the borrower remains a beneficiary, though not against a transfer to a company. I am admitted in New York, Louisiana, and Texas as well as Florida; for property elsewhere, I prepare the trust and have the deed prepared by a lawyer or title agent in that state.
The trust avoids the second probate. It does not avoid the second state’s estate tax, which follows the land, not the form of ownership.
An entity turns land into personal property
Property held in a limited liability company is owned by the company. What you own is a membership interest, which is personal property and follows you to Florida. At your death the interest passes under your Florida documents, with no ancillary administration. This works well for rental and investment property, especially where there is also a liability reason to use an entity. It works badly for a residence you use yourself: The transfer may trigger a reassessment or a transfer tax, the lender’s due-on-sale clause is not protected, that state’s residence exemptions are usually lost, and some states tax the entity itself. And several states look through an entity to tax real property within them.
Other states have tools Florida does not, and the reverse
Many states permit a transfer-on-death deed, a recorded instrument that names who takes the property at death and can be revoked before then. Florida has no statutory transfer-on-death deed. What Florida has instead is the Enhanced Life Estate “Lady Bird” Deed, a common-law instrument that does much the same work for Florida property. Where available, a transfer-on-death deed can be a simple fix for a single parcel, and it leaves the property in your own name while you live. Joint ownership with right of survivorship also passes property outside probate in every state, with the usual cautions about adding a co-owner who is not your spouse. Tenancy by the entirety exists in some other states and not in others, so a married couple should not assume the protection they have here travels with the deed to the cabin.
Your former state may not agree that you left
Florida residency is established by conduct and documented on paper: a declaration of domicile recorded under Fla. Stat. § 222.17, the homestead exemption application, a Florida driver’s license, voter registration, where your doctors and your safe deposit box are, and where you actually spend the year. States that tax income or estates, New York, Massachusetts, and Minnesota among them, audit domicile aggressively when a former resident stops filing or dies, and the burden of proving the move is on the person who says they made it. A former New Yorker who keeps the apartment, spends more than half the year in it, and still has a will reciting a New York residence is handing New York an argument. Every will and trust I draft recites Florida domicile, and I tell clients which of their habits say otherwise. As I noted in my article on Florida homestead, none of Florida’s protections travel with you when you leave; the converse is that the other state’s taxes do not let go until you have really arrived.
Florida documents travel reasonably well
A will validly executed in Florida will be admitted in the other states under their own rules, as Florida admits a will validly executed elsewhere (Fla. Stat. § 732.502(2)). A durable power of attorney and a designation of health care surrogate are generally honored across state lines, and Florida honors theirs. In practice, a hospital in Minnesota or a bank in New Jersey may balk at a Florida form it has never seen, and if you spend months of every year in another state I suggest a second power of attorney and a second set of advance directives on that state’s forms, consistent with the Florida set and naming the same people. A Florida trustee may administer property anywhere. Some states, though, tax a trust’s income based on where the trustee or a beneficiary lives, which is a reason to think about who serves as successor trustee and where.
Personal property follows you home
Vehicles, boats, bank and brokerage accounts, and the contents of a house pass under the law of your domicile wherever they happen to be, so a boat kept at a marina in Rhode Island passes under your Florida documents. The practical trouble is paperwork. That state’s title agency may want its own form of affidavit, or letters from a court, before it will retitle the boat. A funded trust, or a transfer-on-death registration where the agency offers one, avoids most of this.
Property abroad is a different matter
Many civil-law countries, Greece, France, and Italy among them, have forced heirship: A fixed share of your estate goes to your children or your spouse regardless of what your will says. The European Union’s succession regulation allows a person to choose the law of their nationality in some circumstances, and Florida has enacted the Uniform International Wills Act, but a Florida will is not a reliable instrument for land in another country. If you own property abroad, I recommend a lawyer there, and I draft the Florida documents so that the two wills do not revoke each other by accident.
A personal representative who lives elsewhere must be a relative
One Florida rule catches families whose children live in other states. A person who is not a Florida resident may serve as personal representative only if they are closely enough related to the decedent: a child, parent, sibling, spouse, or certain other relatives by blood or adoption, or the spouse of one (Fla. Stat. § 733.304). A friend in Atlanta or a business partner in Chicago cannot serve, and a will naming one leaves the family to petition for someone else. A trustee has no such restriction, which is one more reason a trust-based plan suits a family spread across the country.
If you own property outside Florida, or are not certain Florida is the only state that thinks you live in it, the first step is the questionnaire, followed by an hour with me in Palm Harbor, or by appointment in Tampa or St. Petersburg.