Questions About Probate
What is Probate?
Probate is the legal process of admitting a will to the courts for determination of its validity. If the will is admitted then a Personal Representative (PR) is appointed to the Estate. Often, the PR has been named in the will. The PR then collects and safeguards the property of the Estate until creditors have had an opportunity to collect their claim. The property is then distributed according to the will or statute. Probate will also be necessary where probatable assets exist, but where no will have been found or executed.
What if my Loved One passed without a will?
If your loved one passed without a will, they are said to have died intestate. This is simply legal parlance for "without a will." If this is the case, state statutes determine how assets will be distributed, and who will receive said assets.
My Loved One had a will, can we just follow it and skip probate?
While it may be tempting to just begin distributing assets on your own, this can be a mistake with legal consequences. Creditors must be given time to collect their debts (ex. the light be still needs to be paid). Assets may be distributed in whole or partially once the PR has been appointed. The PR must then distribute according to the will or statute if applicable.
Does the Estate need a lawyer?
It is advisable that the Estate and Personal Representative (PR) seek legal counsel. Legal counsel can aid the PR in many ways. This is discussed further below.
What does a lawyer do for the Estate?
The attorney for the Estate may do a number of things. The attorney's role is heavily dependent on the circumstances, needs of the Estate, complexity of the Estate, and the Personal Representative. Generally, the lawyer may do the following:
(1) Draft and file the initial documents required to open the probate and have the PR appointed.
(2) Advise the PR on their fiduciary duties, legal matters, the will, and statutes.
(3) Draft the documents necessary to transfer property or title.
(4) Represent the Estate or PR in court if circumstances so require.
(5) Aid the PR in handling creditor claims. Including, if necessary, order of claims.
(6) Act as an intermediary to prevent family conflict or to settle conflict.
(7) Contact title companies, real estate agents, accountants, or appraisers as the Estate requires.
(8) File the Estate with the IRS to receive the EIN.
(9) Draft and file the documents necessary to close the probate and discharge the PR from their role.
(10) Other services or skills necessary for the settlement or administration of the Estate.
Are there different types of probates?
Yes, there are several types of probates. There is informal or formal probate, supervised or unsupervised probate, and small estate affidavits. These are discussed further below.
Formal and Informal Probate
Formal probate can occur when a will is being challenged, the original will has been lost, or if requested by family members (possibly due to fighting over assets). The formal process generally includes hearings to admit the will, appoint the Personal Representative, and if necessary, supervise the administration of assets.
Informal probate can be requested when the original will can be admitted, and the will is not being challenged. Informal probate consists of admittance of the will into probate and appointment of the PR by the Clerk of Courts. They type of probate is typically unsupervised.
Supervised and Unsupervised Probate
Supervised probate is where the court supervises the collections and administration of the Estate's assets. The Judge will approve or disapprove the distribution of the property based on whether the will is being adhered to, or statutes in the case of intestacy.
Unsupervised probate is when the PR has been appointed, but no further supervision occurs on the part of the courts. However, if the PR abuses their power, a supervised probate can be implemented by a person with standing (typically a family member). Although a court does not supervise an unsupervised probate, the beneficiaries and designees of the Estate are still entitled to an accounting of the Estate.
Small Estate Affidavits
A small estate affidavit occurs when the decedent's Estate is valued at less than the statutory threshold, or after non-probate transfers, is valued at less than the statutory threshold. Further, to qualify for the small estate affidavit, an Estate must not hold any real property. In this situation, creditors are still given notice to file claims, but after the claim period has run the assets are simply distributed. An affidavit is then filed. This is typically done for low net-worth Estates.
What is a Personal Representative and what do they do?
A Personal Representative (PR) is the individual or entity appointed by the courts to administer the Estate according to the will or statute. The PR also ensures that property is safely kept until it is distributed, and must ensure that creditors claim's are satisfied. PR's have gone by other names, and you may have heard them referred to as: Executors, Executrix, Administrators, or Fiduciaries. PR's also owe the Estate duties known as fiduciary duties. These duties include administering the Estate to the best of their ability, the duty of loyalty, the duty of care, and the duty to account for the property of the Estate.
It is advisable that the PR contact an attorney and an accountant to aid with the administration of the Estate. Even a small estate can be rife with legal, financial, and accounting complexities.