Probate administration involves ensuring the probate process is carried out properly, both according to state law and the final wishes of the deceased person.
What is probate? What is an Estate? The word “probate” is used as both a noun and a verb. As a verb, probate is the act of distributing an individual’s assets, and settling their debts through court action. As a noun, probate refers to a legal subject matter including conservatorships, wills, trusts, and the like. Someone’s “estate” includes all the money and property owned by that person. When do I need to probate an estate? In order to make this determination, you must first answer some questions regarding estate value, titled ownership, and relationship to the person who died. If the estate of person who died is valued at less than $150,000 in assets at the time of their death, and the beneficiaries of these sums can be easily determined, you may not need to go to court. In this case, ownership can be transferred by affidavit. If the estate of the person who died is valued at more than $150,000 you must go to court and start a probate case. What is an Executor of an estate? What is an Administrator of an estate? An executor (a role identified in a will or trust) is a person identified by the person who has died and is responsible for finding the assets of a deceased person and distributing them to the inheritors. An administrator of an estate is similar to the executor and has similar duties. The difference between these two roles is that an administrator is appointed by the court when no will is left by the person who has died. What is fiduciary duty? A “fiduciary” is someone who is responsible for money. “Fiduciary duty” refers to the legal responsibility a fiduciary has to act in the best interest of the beneficiary of that money. What happens if other family members object to either a will or executor/administrator's decision? You must have a reason accepted by the court to contest a will in California. An interested person can contest a will if there was fraud involved in its making, or if the document does not meet the standards of a will in the state of its creation. The court might accept other reasons for a will contest, but an interested party can’t contest a will simply because he or she doesn’t feel the provisions are fair. Can creditors take part of the estate of a person who has passed away? Notifying creditors of the death is part of the probate process. Creditors must file a claim with the courts for the amounts due. If the executor approves the claim, the bill is paid out of the estate. If the executor rejects the claim, the creditor must sue for payment. If there is not enough money to pay all debts, state law determines who gets paid first.
Attorney Thomas B. Burton answers a reader question about what paperwork she may need to file with the State of Wisconsin for her mother who passed away in Dane County while receiving Care Wisconsin services.
Attorney Thomas B. Burton answers a reader question about her rights, responsibilities and options after inheriting a home subject to a mortgage from her grandmother.
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What is Probate? Typically, we advise that a client that creates a Will consider if there are any circumstances that will make the probate proceeding an expensive one. For instance, is any distributee being disinherited? If so, that disgruntled distributee may appear before the Surrogate and object to the Will. The litigation objecting to a Will can be long and drawn out in addition to being expensive as well. Are there missing heirs that must be found before the Will can be probated? If so, it could be very expensive and time-consuming to find all the individuals that are required to be given notice and an opportunity to object. Is there real property owned by the decedent in different states? If so, then the Will would have to be probated in each state. If any of these circumstances exist, you may want to avoid probate altogether. We also suggest avoiding probate if you are the surviving spouse and your spouse is or has received Medicaid benefits. Medicaid has a lien against the spouse's estate for any Medicaid benefits paid for the other spouse within ten years of the death of the surviving spouse. Another reason to avoid probate is if you have a disabled beneficiary as the Surrogate's Court may appoint a Guardian ad litem to protect that person's interest. That could be another delay and cost to the estate. Avoiding Probate Once you determine that circumstances surrounding your situation may make it expensive and time consuming to probate your Will, the next question to consider is how do you avoid probate? One way to avoid probate is to name beneficiaries on all your accounts. But I rarely, if ever, suggest that a client resort to this solution without first considering the consequences. First, it may not be possible to name beneficiaries on all your accounts. What if your beneficiary is a minor or disabled? If that is the case, the minor or disabled beneficiary would have to have a Guardian appointed to collect the bequest. This can also be a time consuming process. For a minor, the Guardian would have to put the money in a bank account, earn little or no interest and turn the money over to the beneficiary when he or she turned 18. If the account was a retirement account, the result is even harsher. The IRA or other retirement account would have to be liquidated, all income taxes paid and the proceeds deposited in to a custodial account at a bank, earn little interest and then be paid to the beneficiary at age 18. Strategies to Avoid Probate Most clients, when given the choice, would rather protect their heirs from divorcing spouses, Medicaid, liens, creditors and taxes than avoid probate. We can protect beneficiaries by having their assets paid to trusts. This can be done in a Will (and probate) or, by avoiding probate altogether by using a revocable trust. The important point here is that it is a mistake to make the avoidance of probate the overriding consideration when embarking upon an estate plan. Not everyone needs a revocable trust, but some people will be well served by using a trust, if the circumstances make probate impractical. Conclusion As with many things in life, one size does not fit all. A successful estate plan takes all personal and unique factors to an individual into consideration. In a world where people are computer savvy and everything is available on the internet, it is easy to believe that you can just do it yourself. The fact is attorneys are called counselors at law for a reason. The documents are only part of the problem and solution. The fact is, there is no substitute for competent legal advice.