What You Should Know about Probate in North Dakota
The probate process can take a considerable amount of time, and this can create difficulties for heirs who may have been depending on the decedent for support. Even if inheritances are not immediately needed, no one wants to wait for a year to receive a bequest, and even simple cases can take close
What Is Probate?Probate is the legal process that follows a person’s death. When you die, for instance, you will leave behind an estate that consists of all assets you own and in which you have a legal interest at the time of your death. The law has a vested interest in making sure all your estate assets are accounted for and legally transferred to the new owners. In addition to effectuating the transfer of estate assets, probate also serves several other important functions, including:
• Authenticating the decedent’s Will (if applicable)
• Notifying creditors of the estate and allowing them the opportunity to file a claim
• Litigating challenges to the Will
• Ensuring that taxes are paid
Formal Probate May Not Be NecessaryAlthough some form of probate is almost always required, formal probate may not be. Like most states, the State of North Dakota does offer an alternative to formal probate for small estates that qualify. For an estate to use the small estate alternative the estate cannot include real property AND the value of the estate, less liens and encumbrances, cannot exceed $50,000. If the estate meets those two criteria, you can use an Affidavit for Collection of Personal Property to distribute estate assets.
Not All Assets Are Part of the Probate ProcessAssets are divided into probate and non-probate assets for the purpose of administering an estate. One of the first things that must be done following the death of an individual is to determine which property is probate property and which property is non-probate property because the non-probate property is usually able to be distributed immediately to beneficiaries. Common examples of non-probate property include:
• Assets held in a trust
• Proceeds of a life insurance policy
• Funds held in accounts designated as “payable on death (POD)” or “transfer on death (TOD)”
• Certain jointly held property
• Funds held in certain retirement type accounts
Formal Probate Can Take a Long TimeNumerous factors can influence the amount of time it takes to probate an estate; however, in the State of North Dakota, it will take a minimum of about four to five months to probate an estate because creditors have at least three months to file claims against the estate. Those claims must then be evaluated and paid or denied before probate can be concluded. An estate with complex and/or valuable assets, or one that becomes involved in litigation, can easily take a year or longer to probate.
You Should Consult with an Attorney If You Are Probating an EstateThe probate process may involve complicated legal concepts that require an in-depth knowledge of the applicable state and federal laws. If you are the Executor of an estate, it is in your best interest as the Executor to consult with an experienced estate planning attorney to ensure that you do not make costly mistakes.