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What is Probate and How Does it Work?

Nov 13, 2023 | Firm News

When you die, your estate goes through a legal process called probate. Probate is the court- supervised process of distributing your assets to your heirs and settling any debts or claims against your estate.

While the specifics of probate can vary from state to state, the general process is similar across the country.

Here’s what you need to know about probate and how it works:

Step 1: Filing a Petition

When someone passes away, the probate process typically begins with the filing of a petition with the court. This petition is a formal request to begin the probate process and is filed by someone who has an interest in the estate.

If you have a will, the person who files the petition is typically the executor that you named in your will. The executor is responsible for carrying out the instructions in your will and overseeing the probate process.

Step 2: Notifying Creditors and Heirs

Once the probate court has received the petition, it will notify your creditors and your heirs that the probate process has begun. The purpose of notifying creditors is to give them a chance to file a claim against your estate for any outstanding debts or bills that you owed at the time of your death. This includes things like credit card debt, medical bills, and funeral expenses.
Creditors have a certain amount of time, which varies by state, to file their claim against your estate.

Your heirs have the opportunity to review your will and contest it if they believe it is invalid. Common reasons for contesting a will include claims that you were not of sound mind when you created the will, that you were under duress, or that the will was forged.

Step 3: Inventorying Assets

Next, the executor of your will (or the court-appointed administrator if there’s no will) will be responsible for taking an inventory of your assets. This includes a comprehensive list of all your assets, such as bank accounts, investment accounts, real estate properties, personal property, and any other valuable items you may have owned.

The executor will need to determine the value of each asset, which may involve obtaining appraisals or other professional opinions.

Step 4: Paying Debts and Taxes

Once the assets have been identified and valued, the executor will need to use them to pay off any debts you owed at the time of your death. This involves using the assets identified in the previous step to settle any outstanding obligations you may have had at the time of your death.

This includes debts such as credit card bills, medical expenses, and funeral costs. Additionally, any taxes owed by your estate, such as estate taxes or income taxes, must also be paid.

If your estate does not have sufficient assets to pay off all of your debts and obligations, the executor will need to follow state law to determine the order in which debts are paid. This may involve selling off assets or liquidating investments.

Step 5: Distributing Assets to Heirs

Step 5 of the probate process involves distributing the remaining assets of your estate to your heirs. Once all of the necessary payments have been made, the executor will move forward with the distribution of assets.

If you left a valid will, the executor will follow the instructions contained within the document for the distribution of your assets. If you did not have a will, your assets will be distributed according to state law.

The distribution of assets can involve selling assets and dividing the proceeds among your heirs or transferring ownership of assets directly. For example, if you owned a home, the executor might sell the property and divide the proceeds among your beneficiaries or transfer ownership of the property directly to the beneficiaries themselves.

If there are disputes among your heirs regarding the distribution of assets, they are often resolved through mediation or arbitration. However, in some cases, they may need to be settled in court.

Step 6: Closing the Estate

The final step in the probate process is closing the estate. After all assets have been distributed and debts have been paid, the executor files a final accounting with the probate court. The final accounting must be approved by the court before the estate can be closed. If the court finds issues with the accounting, it may require additional documentation or a hearing to resolve any disputes.

It’s important to note that closing an estate can take several months or even years, depending on the complexity of the assets involved and any legal disputes that may arise.

It’s the executor’s responsibility to ensure that all required documents are filed and all debts are paid in a timely manner, and to keep all interested parties informed of the progress of the probate process.

Can I Avoid Probate Completely?

Probate can be a lengthy and expensive process. Many people prefer to avoid it if possible. Here are a few ways to avoid probate:

  • Establish a Revocable Living Trust: Transfer your assets into a trust during your lifetime to maintain control and ensure a smooth transfer to beneficiaries without
  • Designate Beneficiaries for Accounts: Name beneficiaries for life insurance policies, retirement accounts, and payable-on-death bank accounts to enable a direct transfer of assets outside of probate.
  • Joint Ownership: Jointly owning property with rights of survivorship allows automatic transfer to surviving owners, bypassing probate.
  • Consider Gifting: Reduce the value of your estate by gifting assets during your lifetime, potentially minimizing the need for probate.

Please note that these strategies may vary in effectiveness depending on state laws and your individual estate. An experienced estate planning attorney can provide personalized guidance to help you navigate probate and probate avoidance.

We Can Help with Probate and Estate Administration

While probate can be a complex and time-consuming process, it’s an important part of ensuring that your assets are distributed according to your wishes after you die.

If you want to avoid probate, there are estate planning strategies you can use, such as setting up a trust or making gifts to your heirs during your lifetime. Our experienced estate planning attorney team can help you explore your options and create a plan that’s right for you. Contact us to get started today.