Once someone dies with property titled in their name alone, (with no joint owners or beneficiaries designated), probate will generally be required. The probate process is commenced by filing either an Application for Informal Probate or a Petition for Formal or Supervised Probate. Since Informal Probate is the least complicated, least expensive form of probate administration available in Michigan, the remainder of this guide will focus on that process.
Determine whether or not there is a Will and who the beneficiaries and interested parties are
If there is a Will, any person named in the Will is considered an interested party. Heirs of the decedent who are not named in the Will (or who are specifically excluded), are also interested parties. All interested parties must be given notice of the filing of the estate, and they have an opportunity to protest the appointment of the Personal Representative (formally known as the executor), as well as an opportunity to contest the Will. If the person applying to become Personal Representative has priority, the estate can be opened, without giving prior notice to the interested parties. Otherwise, notice must be given at least two weeks before filing the papers with the court. Once the paperwork is filed, the Personal Representative is typically appointed and provided with Letters of Authority, on the spot. There is a $150 filing fee to open the estate, plus a charge of $11 for each certified copy of the Letters of Authority. These letters are legal authority to probate the estate.
After the Letters of Authority are issued, the Personal Representative gives notice to the interested parties or his or her appointment. Notice is also given regarding attorney fees, as well as a copy of the written fee agreement, with the attorney, (provided an attorney is retained). A Creditor's Claims Notice is published in a newspaper to give potential creditors notice that an estate has been opened and a personal representative has been appointed. The charge for this publication is normally about $70. The Personal Representative is required to send actual notice to "known creditors." The benefit of the publication and notice is that, if a claim has not been made within 4 months of the date of notice, then the claim is barred.
The Personal Representative (PR) usually opens an estate checking account, and liquidates the decedent's remaining assets into that account. The PR is required to submit an "Inventory" to the probate court within 91 days of appointment. The Inventory lists all of the decedent's probate assets, valued as of the date of death. At the time the inventory is submitted, an Inventory Fee is due. The Inventory Fee is based on a percentage of the value of the assets, and is usually between $100-1,000.
A notice must also be sent to the county Friend of the Court, notifying that office as to the administration of the estate and the identity of the interested parties. This is presumably to put that office on notice in case one of the beneficiaries is in arrears on any outstanding child support obligations.
Wrapping up the Estate
The PR is required to file a final income tax return for the decedent. The PR is also required to file an estate income tax return (Form 1041), if the estate earns more than $600 in income in any year. There may be other tax filings required, if the estate is subject to Federal Estate Tax. Those obligations are beyond the scope of this Guide.
Once all of the assets have been liquidated, and all of the administrative expenses of the decedent have been paid, the PR must provide the beneficiaries of the estate with a Final Account, detailing all of the income and expenses of the estate, from the start of the probate administration. This Account is often submitted at the time of the final distribution of the beneficiary's share of the estate, as well as the Closing Statement, and a Receipt form. The PR then has the Receipt forms filed with the probate court, as well as the Closing Statement.
In the event that the estate cannot be closed within one year of the PR's initial appointment, the PR must file a Notice with the court and serve it on the interested parties to explain why the estate must remain open. The court typically allows administration to continue, as long as there is a valid reason.
The Closing Statement cannot be filed less than 5 months from the date of the PR's initial appointment. Once the Closing Statement is filed, a Certificate of Completion can be issued by the probate court, after 30 days have passed. This Certificate officially closes the probate administration.