My stepdad in Michigan recently died, leaving everything to my mother in his will. Everything they owned was held jointly between them except his IRA, which only has about $6K in it. Turns out he didn't name her as a beneificary for the IRA. The bank is telling my mom she needs to have his will probated to get the IRA. But the lawyer who helped my stepdad receive Medicaid funds during his nursing home stay says that as soon as the will is probated, the State of Michigan will come take the money in the IRA. So I have two questions: 1) Is there any way my mother can get this money, which she desperately needs? 2) If not, does she legally have to have to will probated, or can she just walk away? Seems awful if she would have to pay to probate the will, only to watch the state take the money.
If this is the only asset, I would try to use a small estate proceeding to obtain the funds. There are some procedures which do not require probate court involvement, and thus, would not be subject to estate recovery. I would attempt this first. If the IRA custodian will not accept it, then you would need to use the court procedures. I believe that the size of this account is such that it would be exempt from estate recovery. There is an exempt property allowance in Michigan that allows you to shelter $14,000 of assets from creditors.
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6 lawyers agree
Mr. Frederick's advice is spot-on.
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