Probate is the court process of transferring assets controlled by your will to your beneficiaries upon your death. The word probate refers to the act of proving the will; but it has come to mean the whole process that occurs after the will is proved to be a valid will.
Frequently, the decedent did not have a will. These estates are controlled by statutes that set out the legal heirs, called intestate succession. The process is still called “probate” even though a will is not being proved. If the personal representative is acting under a will we call him an Executor. If he is acting for an estate without a will, we call him an Administrator.
The process will be different for each estate. It will depend on what assets the decedent owned at death, the size of the estate, and where the decedent was a resident at death. When someone dies, we usually sit down with the person named as Executor to plan the needed activities. We review the assets and debts of the estate. The first thing we do is identify which assets pass through the probate process and which ones pass to beneficiaries under some other process. There are procedures necessary to collect and transfer all property; however, only the probate property is subject to court formalities. Those formalities can include filing an application for probate, advertising for creditors, producing an inventory of assets, and an accounting for distribution and collections during the probate process.
Anything that does not have a specific beneficiary or survivorship provision will get to the heirs through the probate process.
What assets will pass to beneficiaries outside of probate?
Many assets will have a named beneficiary or are owned with a right of survivorship. The will or intestate succession will not control these items. This can be a good thing, as they may be easier to transfer, and require less paperwork and formality. When we are doing estate planning in advance, we try to focus on these strategies before we start writing a will.
- Life insurance payable to beneficiaries;
- Retirement plans that pass to named beneficiaries;
- Land that is owned with a spouse as tenants by the entireties;
- Land that is owned with another person in which the deed specifies a right of survivorship;
- Bank accounts with a right of survivorship;
- Stocks, bonds, or securities accounts with a right of survivorship;
What else does the personal representative have to do?
In addition to completing the probate process to the satisfaction of the Clerk of Court, the personal representative must arrange to transfer each asset to the correct beneficiary. This process will require the personal representative to provide whatever documentation or procedures are required by the holder of each asset to transfer ownership to the heir of the property, whether the property goes through probate or not. This means that the personal representative will need to deal with each bank, securities firm, and so forth to provide the required documents that will result in the transfer of ownership to the ultimate owner.
The tax man cannot be forgotten. One important duty of the personal representative is to make sure that all tax filings are made. These can include estate taxes if the estate is large enough, but more commonly there will be income tax returns and estimated taxes to file for the deceased.
This is information, not legal advice. We are offering some general information on a topic that may be of interest. This is not legal advice. Your circumstances will be different from anyone else’s. If you have questions about a specific issue or asset, please call our office and make an appointment for a consultation. We will be very happy to work with you.