Tag: Probate Attorney/Lawyer

Estate Planning

Probate’s Timeline

SchulzeLawGroup

A will must go through probate before it is acknowledged, a personal representative (executor) is named, and assets are distributed according to the will. It also requires paying the decedent’s outstanding debts and federal and state taxes. Each state has different laws determining if probate is necessary or can be expedited, whether the fiduciary requires bonding, and what reports must be prepared. The probate experience is unique, as no two wills are the same.

In general, the timeline of the probate procedure moves quickly if the estate has minimal assets and little debt. Larger estates can expect a process lasting anywhere from nine months to a few years, especially with problematic family dynamics. An estate planning attorney or probate lawyer can help guide efforts in these more complex or contentious circumstances. During a time of grief, it is reassuring to have a general probate timeline to help manage expectations and deadlines as you move through the process.

Prepare and File the Probate Petition (1-4 months)

Filing a probate petition requires a valid will and the decedent’s death certificate, usually provided by the funeral home. The personal representative or executor sends an official notice of probate to beneficiaries or interested parties, with each state having specific requirements regarding the notification process. To speed the process, when there is agreement among beneficiaries, each party signs the “waiver of process consent to probate.” This consent form advises the court there are no issues with the will, and beneficiaries forfeit the right to challenge the will or its executor.

Usually, an executor sends a notice of probate within the first two months of the decedent’s passing. Some states require a notice of death published by the executor in the newspaper. The executor provides the funeral home with the decedent’s Social Security number, and they create a legal death certificate. An executor may prefer to purchase several death certificates for larger estates. It is a responsibility to report the person’s death to the Social Security Administration. If the decedent received medical benefits, a notice of death to the Department of Health and Human Services (HHS) is a requirement.

Provide Notice to Creditors (3-6 months)

Like all beneficiaries, all creditors must be aware of the decedent’s will. The estate’s personal representative notifies appropriate claim holders via a formal notice to creditors and other firms, companies, or people to whom the decedent owed money. It is important to follow court rules for notifying creditors. Discovery regarding the deceased’s outstanding debts is most easily achieved by gathering the remaining bills or requesting a copy of the decedent’s credit report.

Payment of Debts and Fees (6-12 months)

The decedent’s creditors receive notification of the individual’s death with a formal notice of death and notice to creditors. The executor must pay all professional and personal debts from the estate with estate funds. The estate is also responsible for payment of the decedent’s state and federal income taxes before the probate process can conclude.

Additionally, the process of probate itself costs the estate money. All fees and administration costs relating to probate are to be paid by the estate via the personal representative’s actions. The fee structure can increase based on the length of time a will is in probate, so the executor benefits by moving quickly and carefully.

Asset Inventory (6-12 months)

An inventory of the estate’s assets is a crucial part of the will since it becomes part of the official estate record. The task can be time-consuming, particularly if the estate’s records are in disarray. Most asset inventory will include:

  • Bank accounts, including savings and checking accounts
  • Property and real estate
  • Stocks and bonds
  • Retirement accounts
  • Life insurance and annuities
  • Luxury items of significant value, like jewelry, watches, art, and other collectibles
  • Intellectual property, including patents, trademarks, copyrights, software databases, and design rights
  • Online line business ventures that produce income or have stand-alone value

Jointly owned real estate, property, vehicles, and financial accounts transfer to the surviving owner. Probate is also not required for IRAs with a beneficiary or other accounts with a pay-on-death designation.

Asset Distribution (9-18 months)

Before asset distribution, the estate’s executor should make every effort to pay all outstanding debts. When all creditor bills are paid, and the remaining assets are accounted for, some state probate law dictates the distribution of assets occur only after the probate hearing. Concluding the probate hearing first prevents the opportunity for an ungrateful or disgruntled beneficiary to threaten the will’s validity.

The Estate Closing (9-24 months)

Probate can conclude when all creditors are paid, taxes are filed, and assets are sold or distributed. After finalizing the executor’s duties, the probate court judge then issues the final order of discharge of the personal representative. This court action officially closes the estate.

All wills go through probate proceedings; however, it is not the only available option. Larger estate owners may prefer to protect the futures of their loved ones using trusts. There are advantages to avoiding probate as it can be lengthy, complex, expensive, and is always a matter of public record.

Your estate attorney can customize an estate plan for your family situation. Our estate planning firm can advise trusts and other legal mechanisms to lessen the probate process or let you know if your estate is a candidate for an expedited process. There is a general timeline for the probate process, yet, all wills and state laws are different.

We hope you found this article helpful. If you have questions or would like to discuss your personal situation, please don’t hesitate to contact our Reno office by calling us at (775) 853-5700.

Estate Planning

Estate Planning to Reduce Probate

SchulzeLawGroup

The probate process occurs after someone passes away. Probate can be lengthy, complex, and expensive, but good estate planning can mitigate unwanted risks by anticipating and preventing problems before they arise. Sound estate planning can make the probate process run efficiently and smoothly, protecting your estate’s value and legacy, and preserving your family’s well-being.

Probate includes:

  • Validating a deceased person’s will
  • Identifying and inventorying the property of the decedent
  • Getting property appraisals
  • Paying valid outstanding debts and taxes
  • Distributing the remaining assets and property according to the will
  • Applying state intestacy laws if there is no will

Avoiding Probate

An estate planning attorney can structure your estate to minimize or avoid probate entirely. Circumventing probate reduces legal fees for your surviving heirs, protects privacy as probate is part of the public record, and avoids estate tax which can significantly reduce inheritable assets.

Popular Alternatives to Probate

A revocable living trust transfers assets to the trust but allows access to them during your lifetime. This probate-avoidance technique can protect any property you own, including:

  • Bank accounts
  • Real estate
  • Jewelry
  • Art collections and heirlooms
  • Vehicles

A revocable living trust

This trust functions like a will by leaving your property to heirs, but you can change the terms of your trust and the beneficiaries or revoke it while you are still alive. After your death, the property in the trust is in the control of your named successor trustee. They distribute the property to inheritors according to the trust’s instructions without involving probate court.

Life insurance and annuity policies

Death benefits are paid directly to a designated beneficiary upon the death of the insured or annuitant and pass outside of probate. And in some states, for example, Texas, death benefits are exempt from creditor claims for either the insured or beneficiary.

Payable-on-Death (POD) accounts or Transfer-on-Death (TOD)

A simple, no-cost strategy to keep money, even large sums, out of probate by designating a beneficiary via the financial institution’s POD paperwork process for all types of bank accounts. A TOD transfer applies to stocks, bonds, and brokerage accounts in the same way. These accounts are not accessible to the beneficiary while you are alive. You can designate beneficiaries on various accounts types, such as:

As the testamentary deposit account owner, you can withdraw money, close the account, or name a different beneficiary at any time. There may be a short waiting period after the designator’s death before the bank or credit union releases funds, but probate is not a requirement.

Depending on where you live, a POD account can also be a:

  • Totten Trust
  • Tentative trust
  • Informal trust
  • Revocable bank account trust
  • ITF, short for “in trust for”

In most cases, you cannot name an alternate beneficiary, so staying current with the paperwork designating your choice is important. No matter what information is in your will, it can’t override a properly established beneficiary designation.

Joint tenants or joint tenants by the entirety designate real estate

This property designation type has two owners. When one owner dies, the surviving owner automatically owns the property. This ownership is commonly referred to as the right of survivorship and also applies to community property in community property states.

Streamlining the Probate Process

Many states have simplified probate procedures for smaller estates, meaning they are under a certain dollar valuation. Depending on your state’s rules, even if your estate exceeds the definition of a small estate, there may be an avenue to exclude large chunks of assets to lower its size and value.

Many states don’t consider the value of certain properties when evaluating an estate. These property types may include real estate, real estate located in another state, and even motor vehicles. Additionally, many states won’t count the value of a property that doesn’t pass through probate. In essence, probate avoidance can pay double dividends after your death.

When trying to minimize an estate’s value to streamline probate, some states permit you to subtract any amounts owed on a property you don’t fully own. This can make a huge difference. Knowing your state’s definition of a small estate is crucial when creating probate-avoidance strategies. Staying under a certain threshold can simplify probate.

Probate Takeaway

A sound estate plan can circumvent many issues that arise from probate, which may cause a lengthy process and reduce your estate’s value and legacy. Avoid the additional costs of probate, both monetarily and to your family’s well-being.

We hope you found this article helpful. If you have questions or would like to discuss your personal situation, please don’t hesitate to contact our Reno office by calling us at (775) 853-5700.

Estate Planning

How to Understand Probate

SchulzeLawGroup

You can minimize or avoid probate entirely by working with an estate planning attorney. Probate proceedings are part of the public record and can be very time-consuming and expensive. However, in nearly every case, some probate is necessary, so it is important to understand how to navigate the process.

Probate proceedings seek to validate the decedent’s last will and retitle the estate’s assets into the name of heirs according to the deceased’s wishes. These court-supervised proceedings ensure estate debts are paid and oversee the distribution of assets to heirs. 

After losing a loved one, the family will generally come together and hopefully encounter a properly written will and other crucial estate planning documents. Without a well-organized plan, the probate process can take much longer. Family members will be tasked with gathering information necessary for court.

Probate Court Proceedings

The petitioner, usually the estate executor or personal representative, will begin the process by filing a death certificate and a last will to the probate court. It is also useful to produce a list of know creditors and names and contact data of the decedent’s heirs. Smaller estate probate processes and those estates not contested by heirs can usually work through probate fairly quickly and efficiently.

Laws regarding probate are state-specific, and most states set valuation thresholds. If, for instance, an estate value is less than $75,000 and no one contests the will, less formal probate hearings may move more quickly. Since the advent of COVID-19, these court proceedings may even transact over video calls.

For larger value estates, there is a substantial amount of necessary paperwork to validate the will, determine asset distribution, settle disputes, pay off remaining debts, and ultimately close the estate by paying the decedent’s final taxes. A checklist of documents to gather may include:

  • Death certificates
  • Final will
  • Revocable trust documents
  • Heir and beneficiary contact data
  • Beneficiary designations
  • Pre or post-nuptial agreements
  • Previous three years of federal and state income and gift tax returns
  • Life insurance policies
  • Real estate deeds
  • Vehicle titles
  • Statements of financial accounts
  • Contracts and business agreement documents
  • Appraisals for high-value art, collectibles, or jewelry
  • Other known assets
  • Known debts
  • Ongoing bills
  • Medical and funeral expenses

Probate Proceedings Without a Will

The decedent’s residence states intestacy laws will apply if your loved one dies without a last will (intestate succession). All personal property without a beneficiary designation will be subject to the probate process at the court’s direction.

But some assets will avoid the probate process under state property title, state contract, or state trust law. These assets may include:

  • Beneficiary designate life insurance policies
  • Beneficiary designate retirement funds
  • Beneficiary designate annuities
  • Pay-on-death or transfer-on-death accounts
  • Joint tenancy property with rights of survivorship
  • Tenancy by the entirety
  • All trust property

Cost of Probate

Complex probate processes can be costly and take years to finalize, which is why many individuals retain an estate planning attorney to minimize probate proceedings. Lengthy proceedings can be frustrating for heirs who are rightful beneficiaries but must comply with the probate process. The average cost of probate varies by state; however, five to ten percent of an estate’s value in administrative costs and legal fees is typical. Some estates may lose as much as twenty percent of their value.

Other fees may include executor compensation, court fees for filings and paperwork, and a probate bond. After the probate proceedings are complete, a probate bond may be refunded. The most common reason for high probate costs occurs when beneficiaries contest the will, as ongoing litigation can be expensive. Issues relating to preparing and filing the decedent’s last federal estate tax return and any ensuing audit may also increase the cost of the probate process.

Most individuals will create an estate plan with their lawyer that allows assets to pass outside the probate process, typically through creating a revocable living trust. Depending on your situation, your estate planning attorney may recommend other types of trusts as well as ensure that named beneficiaries on accounts that pass outside of probate are up to date. Regularly reviewing your estate plan with your attorney can help minimize probate court interactions and streamline your heir’s inheritance process. If you have questions or would like to discuss your personal situation, please don’t hesitate to contact our Reno office by calling us at (775) 853-5700.

Estate Planning

An Overview of Probate

SchulzeLawGroup

ABA explains that probate is a legal process that gives legal recognition to a will, and appoints the executor, also known as the personal representative, to administer the estate and distribute property. Therefore, it is good to contact a probate lawyer to determine if the estate is small enough to bypass formal probate, whether the fiduciary must be bonded (this requirement is often waived in the will), and what reports are necessary to prepare.

The Uniform Probate Code

In more recent years, states have tried to simplify their probate procedures. The Uniform Probate Code (UPC) consists of laws written by a group of national experts to help standardize and streamline probate, and most states have adopted these standards. Across state lines, the probate process is finally beginning to work more effectively.

Probate Attorneys Help Navigate or Avoid Probate

However, this does not mean you shouldn’t meet with a probate attorney. Individual states still have different monetary thresholds for what constitutes a lower value estate that can bypass part or all of the probate process. Administering complex estates with an attorney’s guidance will be beneficial even if most estate assets already take advantage of estate planning tools designed to bypass probate. The attorney can support the executor or personal representative when providing the local courts with basic information like death certificates, form submissions, and communication with beneficiaries while administering the estate. The goal is to keep the probate process as simple as possible.

The essence of probate involves the following:

  • Determining and proving the decedent’s will
  • Submitting an estate inventory and appraisal of the decedent’s property
  • Ensuring the estate’s taxes and debts are paid in full
  • Making sure every estate asset is distributed in accordance with the decedent’s will or the state’s intestacy laws.

Probate Attorneys Help Executors Through Estate Administration

The estate’s personal representative is responsible for initiating court procedures and distributing the assets to named beneficiaries. If the personal representative fails to initiate probate proceedings, any party interested in the estate may initiate probate. Typically, these parties include those who will gain assets from the will, like a beneficiary or a creditor. In the absence of a named personal representative or if they are unwilling or unavailable to administer the estate, the court will appoint one to oversee the probate process. You may hire a probate attorney instead.

The time frames to begin the probate process are state-dependent. They begin at the decedent’s date of death and range from three to twenty or more years. Some states have no time limits for filing a will for probate, like California.

Removing Conflict and Debt Negotiation

Once the gathering and filing of the necessary paperwork for the probate process are complete, you may find a disgruntled heir or someone bypassed from the will altogether make a legal challenge to the probate court, perhaps contesting the validity of the will. These legal challenges slow administering the estate, as can handling an estate with excessive debt where property needs to be sold to make good on debt claims. A probate attorney can mediate conflicts that arise by removing emotions from the decisions and negotiating debts.

If the probate process is going to be lengthy, immediate family members can ask the court to release short-term support funds in most states. The reputation of probate is at times well deserved for being time-consuming and expensive.

The probate process can be simple only when heirs agree with the will and the dissemination of property and assets. In that case, the executor provides the local courthouse with the decedent’s last will, a certified copy of the death certificate, a list of names and addresses of heirs, and a list of known creditors.

Maintaining Privacy

If there is disagreement among heirs, it is worth sorting out issues before beginning the probate process to avoid a legal challenge to the will. Once filed, probate proceedings are part of the public record, and most people prefer privacy regarding the death of a loved one and inheritance. However, excessive delay in the probate process will likely create more complex and expensive situations to resolve. If you need to work things out with heirs before beginning probate, it is best to resolve issues, if possible, sooner than later.

Avoiding Probate with Estate Planning Tools

While some probate processes can be extensive, taking multiple years to complete, most probate does not. Many estate planning attorneys help their clients avoid extensive probate through mechanisms such as a revocable living trust. This trust type allows the property in the trust to pass outside of probate. Other ways to avoid probate are titling property with survivorship features or adding beneficiaries on accounts, such as an IRA. Knowledgeable estate planning attorneys use these mechanisms and entities to keep the probate process to a minimum. These entities may include:

  • Annuities, life insurance policies, and retirement funds with named beneficiaries
  • Pay-on-death or transfer-on death-accounts
  • Property in joint tenancy with rights of survivorship
  • Property held as tenancy by the entirety
  • All property held in a legal trust

Most individuals seek to minimize the probate process when creating their estate plan. This best practice is suitable for larger and more complex estates as probate can become expensive and significantly decrease your estate’s inheritable value. Even smaller value estates using the entities and techniques for direct transfer or property outside of probate can benefit. Talk over your wishes with your estate planning attorney to create a plan that can minimize probate. If you are already a named personal representative and the existing estate plan is murky or without the presence of a will, a probate lawyer can help you assess the best path forward to accomplish the probate process with minimal loss to the estate’s value. We hope you found this article helpful. If you have questions or would like to discuss your personal situation, please don’t hesitate to contact our Reno office by calling us at (775) 853-5700.