The term probate refers to the process by which a person’s last will and testament is executed. The will is filed in court, and the latter oversees the administration of the terms and conditions found within the document. Some individuals use an estate planning attorney to ensure the appropriate documentation is in place prior to their death, as this can go a long way toward avoiding probate complications at a later time.
THE PROBATE PROCESS
Probate is governed by state laws, and each step of the process is contingent upon a variety of factors, such as the real estate laws in the area where the deceased person lived, and whether he or she had a will or died intestate–without a will.
If the appropriate documents were in place at the time of the person’s death, the administrator of the estate is typically named in the will and referred to as an executor. However, if no such person is named or no will is in place, the probate court chooses an executor and the process begins.
The next part of the probate process is the identification and inventorying of the deceased person’s property. In most cases, assets cannot be distributed or sold until probate is complete. Properties are then appraised, and any taxes or debts owed by the deceased must be paid. Finally, the assets that remain are then distributed according to deceased individual’s will or based on state law if the person died intestate.
Even though probate is typically a straightforward process, numerous individuals prefer that it be avoided. Multiple reasons exist for this preference, but below are the three most popular:
If the will is contested or if the estate is particularly complicated, it may take several years to finalize it through probate court. Such delays often cause major inconveniences for all involved.
Although specific costs vary widely from one state to the next, probate generally includes administrative expenses, such as fees for the executor, appraiser, and probate lawyer. The fast accumulation of such charges often leads to additional expenses that most people do not anticipate.
Probate is a court-related process, and therefore a matter of public record. For this reason, many individuals prefer to avoid this process entirely. However, no matter why a person wishes to avoid probate, he or she will be pleased to know that specific steps can be taken to do so.
In most states, a probate exemption level is predetermined by the state. At the very least, this provides for an expedited process if the estate is small. For this reason, some individuals prefer to keep their estate small, as well as familiarize themselves with the probate estate limits in the area where they reside.
BENEFITS OF A LIVING TRUST
Establishing a living trust is another good way to avoid probate, as property that is held in trust does not become part of the deceased’s estate. This is due to the fact that a specifically-appointed individual controls the trust under previously arranged terms and that person is obligated to distribute it accordingly, with no need to wait for the probate process.
MAKING ACCOUNTS PAYABLE UPON DEATH
Accounts designated as payable upon death are immediately distributed to the appropriate beneficiary, rather than having to go through probate. Therefore, this is another good way to simplify the process.
ADVANCE DISTRIBUTION OF ASSETS
Some individuals avoid probate or ensure a simplified probate process in the future by reducing the value of their estate in advance. This can be done by distributing property to friends and family prior to one’s death, rather than after.
Estate planning attorneys can assist virtually anyone to avoid probate or its pitfalls. For this reason, certain individuals seek the advice of such a professional in advance in order to simplify or eliminate the probate process.