Probate can be avoided altogether with proper estate planning, or certain assets can be placed outside of the probate process.

The Street’s recent article on this subject asks “What Is Probate and How Can You Avoid It?” The article looks at the probate process and tries to put it in real-life terms.

Probate is an estate planning process that works within a probate court with a probate judge presiding over the proceedings. Usually, surviving families and other interested parties initiate a probate process to address issues relating to the deceased individual’s estate settlement. These include:

  • The handling of the deceased’s valid will;
  • Properly categorizing the deceased’s assets;
  • Appraising the deceased’s estate and property;
  • Paying off any of the deceased’s existing debts; and
  • Distributing the deceased’s property to those directed by the will (or, if there’s no will, the probate court will direct the distribution of estate assets according to the laws of intestacy).

The Personal Representative (or Executor) handling the deceased’s estate will typically start the process. Here are the basic steps:

File a Petition or Application. The estate’s Personal Representative (or Executor) will file a request for probate where the deceased resided, owned property, or both.  The court will then assign a date to confirm the Personal Representative and, once that is done, the probate judge will officially “open” the probate file.

Notice. The Personal Representative must send a notice that the deceased’s estate is officially in probate to all applicable beneficiaries, heirs, and creditors.

Inventory Assets. The Personal Representative will then collect, list, and present a value for all of the deceased’s assets and supply this to the probate court.

Pay the Bills. The Personal Representative will need to pay all outstanding debts owed by the estate.

Complete Any Tax Returns. The estate may also have tax returns that need to be filed. An accountant can be hired by the estate to work on this, or the Personal Representative may choose to file the taxes on his or her own if they have experience in doing so.

Pay the Beneficiaries ( or Heirs). The Personal Representative can now distribute the remainder of the estate to the beneficiaries according to the will’s instructions.  If the decedent did not leave a will, state law will determine who receives the assets – those individuals are the decedent’s “heirs.”

Close the Estate. Finally, the Personal Representative will file paperwork with the court to “close” the estate.

An experienced estate planning attorney licensed to practice in your state will be able to explain what strategies are used to avoid probate, how to remove certain assets from the process, or whether it needs to be avoided at all. In some circumstances, probate is swift, while in others it can become long and tiresome. A local estate planning attorney is your best resource.

Reference: The Street (July 29, 2019) “What Is Probate and How Can You Avoid It?”