In most cases these are assets that are in the descendant’s sole name at time of death which contain no provision for automatic succession. This may include:

Bank accounts

Life insurance policies

Real estate

Vehicles

Probate is a legal process provided for by state laws. It helps determine the value of the person’s property and how these assets will be distributed to heirs. Proceedings take place in the circuit court where the deceased property owner lived or maintained his primary place of residence.

The court assigns a Personal Representative (PR) to administer the probate case. Many times it is noted in the Will who is to be appointed. Under certain circumstances the court may appoint someone else other than who is stated in the Will. Once the PR is appointed, it is his or her responsibility to oversee all the stages of probate.

Court costs, executor’s fees and possible expenses, a surety bond, appraisal fees, paying creditors, property taxes, maintaining  real estate, utility bills,  plus legal and accounting fees. If there is a “Will contested” expenses can run even higher.

Probate usually occurs in the appropriate probate court in the County where the deceased lived. Probate papers are filed with the Clerk of the Circuit Court in the county where the deceased lived. There is a filing fee required. Once the fee is paid, the clerk assigns it a file number and maintains a docket sheet that lists all the papers that are filed with the clerk for probate administration. We highly recommend that you seek the council of a qualified probate attorney to handle this for you.

Also known as an executor, a personal representative can be an individual, bank or trust company. Any individual who is either a resident of the state, or is a spouse, sibling, parent, child or certain other close relative can serve as a personal representative. To be a personal representative, a bank or a trust company must be approved to do business in the state.

No, it’s not mandatory. If you do elect to function as the estate’s Personal Representative you can step down at any time, although you may have to provide a written “accounting” for the time you did do the job. An alternate Executor named in the Will is then appointed by the probate court. If no alternate is named in the Will, or the named alternates die or does not wish take this responsibility on, or a person dies without a Will, the probate court will appoint someone to serve in this position throughout the probate process.

The Rights and Responsibilities of the Executor and Personal Representative during probate are numerous and varied. When the court appoints you as Personal Representative of an Estate, you become an officer of the court and assume certain duties and obligations. Below you will find a general list of the Personal Representative’s responsibilities in most counties. The list is not exhaustive and this site does not provide legal advice. An attorney is often sought to advise on these matters and you may wish to have a probate attorney review your case. At a minimum, you should understand the following:

1. Filing Documents

You will need to file the necessary court documents to prove the decedent’s will. This is best accomplished with the help of an attorney.

2. Inventory of Estate Property

• Locate, identify and gather and inventory of all the estate’s property: First, you must determine if there are any probate assets. You must attempt to locate and take possession of all the decedent’s property to be administered in the estate.
• Determine the value of the property: This can be done yourself or you can consult a professional to assist you such as an Attorney, Realtor or an Appraiser.
• File an inventory and appraisal: In most states within four months after letters are first issued to you as personal representative, you must file with the court an inventory and appraisal of all the assets in the estate.

3. Managing the Estate’s Assets

• Prudent investments: You must manage the estate assets with the care of a prudent person who is dealing with someone else’s property. This means that you must be cautious and may not make any speculative investments.
• Keep estate assets separate: You must keep the money and property in this estate separate from anyone else’s, including your own. When you open a bank account for the estate, the account name must indicate that it is an estate account and not your personal account. Never deposit estate funds in your personal account or otherwise mix them with your or anyone else’s property. Securities in the estate must also be held in a name that shows they are estate property and not your personal property.
• Interest-bearing accounts and other investments: Except for checking accounts intended for ordinary administration expenses, estate accounts must earn interest. You may deposit estate funds in insured accounts in financial institutions, but you should consult with an attorney before making other kinds of investments.
• Other restrictions: There are many other restrictions on your authority to deal with estate property. You should not spend any of the estate’s money unless you have received permission from the court or have been advised to do so by an attorney. You may reimburse yourself for official court costs paid by you to the county clerk and for the premium on your bond. Without prior order of the court, you may not pay fees to yourself or to your attorney, if you have one. If you do not obtain the court’s permission when it is required, you may be removed as personal representative or you may be required to reimburse the estate from your own personal funds, or both. You should consult with an attorney concerning the legal requirements affecting sales, leases, mortgages, and investments of estate property.
• Receive Payments: You need to receive payments due the estate, including interest, dividends, and other income (e.g., unpaid salary, vacation pay, and other company benefits).

4. Notice to Creditors

• You must mail a notice of administration to each known creditor of the decedent within four months after your appointment as Personal Representative. If the estate has an attorney, the firm will most likely take care of this for you and publish the notice in the local legal review or newspaper (the procedure and deadlines for creditors to file claims vary from state-to-state).
• You will need to continue to pay the decedent’s bills (including funeral costs and the expenses to administrate the estate), outstanding debts, valid claims and taxes as well as close unnecessary accounts such as utilities, charge cards and memberships
• File and pay income and estate taxes and notifying Social Security, Civil Service, and Veterans Administration of the death.

5. Distribution of Assets

You must distribute the decedent’s property according to the will or state law (if there is no Will, the state’s “interstate succession laws” apply).

6. Insurance

You should determine that there is appropriate and adequate insurance covering the assets and risks of the estate. Maintain the insurance during the entire period of the administration.

7. Record Keeping

• Keep accounts: You must keep complete and accurate records of each financial transaction affecting the estate and provide an accounting to the court. You will have to prepare an account of all money and property you have received, your expenses, and the date of each transaction. You must describe in detail the remainder after the payment of expenses.
• Court review: Your account will be reviewed by the court. Save your receipts because the court may ask to review them. If you do not file your accounts as required, the court will order you to do so. You may be removed as Personal Representative if you fail to comply.

8. Close Probate

You will need to attend the final hearing in order for probate to close and settle the case. All items above need to be complete before the judge will pronounce the case closed.

All of your assets do not have to go through probate. Most states allow a certain amount of property to pass free of probate, or through a simplified probate procedure. In California, you can pass up to $100,000 of property without probate (other states will vary), and there’s a simple transfer procedure for any property left to a surviving spouse. Real property that passes through joint tenancy or a living trust, outside of the Will, is not subject to probate.

These items, however, must be assessed through the probate process: Assets named only in the deceased person’s name must go through probate. One-half of each asset registered as community property in the decedent’s name will go to his or her spouse. The deceased person’s portion or share of an asset where the asset is registered as tenants in common will go to other people; Assets, which are owned but are not registered, such as furniture, jewelry, etc. are appraised during probate. Some assets may be transferred without the need of probate assessment, including any assets held in joint tenancy such as land, property, vehicles, and bank accounts, any asset held in a living trust, most life insurance and retirement benefits.

During probate, you may have to sell some or all of the estate assets to pay taxes, fees and/or debts. The executor or administrator is expected to prepare a budget with an estimate of the federal estate tax, fees for the executor and attorney, administrative costs, cash bequests under the Will, and debts or claims. If there is not enough cash available, then a decision is made regarding which assets to sell. The court has to approve the sale of each asset before the executor or administrator may sell during a probate proceeding. A court order or court hearing may be necessary for different types of assets. If there is enough cash in the estate, then no assets need to be sold, but still can be put up for sale if the Executor determines this is the best course of action to take.

Although some sort of legal process is necessary to transfer legal title from the deceased’s name to his or her beneficiaries or heirs, many states will allow some types of property to pass on to beneficiaries completely free of the probate process, or through a simplified probate process. The more clear and precise the Will has been written, the better the chance of avoiding a lengthy probate process, or probate at all.

Probate isn’t required if the deceased/author of the Will did not own titled or considerable assets. An administrator is usually appointed to execute the Will if a family member cannot fill this function. The state will take ownership of the estate if there is no Will and no executor or family member to execute. Moreover, if no contractual obligation exists for the deceased’s half of the real property, land, assets, and so on to automatically go to the joint owner – the Will often names a different beneficiary for his or her 50% of the estate’s assets. One of the more common revenue items exempt from probate are life insurance policies. There are also other items, such as annuities, that are tied to contractual beneficiaries and therefore are specifically not subject to probate. There may be a contractual beneficiary on a bank account or trust, for example – also released from having to go through probate.

Real property, land, and certain other assets can also bypass probate, up to a set financial value (as per each state’s probate laws). These assets are handled in a simpler manner than probate affords. A Living Trust holding legal title to all or some of the estate’s property, naming a specific beneficiary or beneficiaries bypasses probate. A “Totten Trust” naming a specific beneficiary or beneficiaries may also shift assets to the beneficiary or beneficiaries without probate. Other types of benefits, such as a life insurance policy or annuity payable directly to a named beneficiary bypass probate, IRAs, Keoghs, and 401K’s transfer automatically, outside probate, to the estate’s beneficiaries. POD Bank accounts (i.e., ” payable-on-death”).

With respect to federal & state taxes, a death terminates the decedent’s final tax year as far as filing an income tax return is concerned, and it creates a new entity for tax purposes called an “estate.” The estate has to complete and file one or more of the following for Federal taxes: Final Form 1040 Federal Income Tax return; Form 1041 Federal Fiduciary Income estate Tax returns; Form 709 Federal Gift Tax return(s); Form 706 Federal Estate Tax return.

As for the state – state income tax return and any state income tax returns during the probate period, plus possible estate tax, inheritance tax and gift tax returns may need to be filed by the executor. However, requirements vary state to state; and inheritance, gift and estate taxes have been eliminated by some states, as far as many of the smaller sized estates are concerned. Your probate attorney will be able to determine how your state’s rulings specifically impact you and your family. Your executor or personal representative should also carefully look for any other real estate, personal property, business, or other state tax liabilities or concerns that may affect you and your family during probate.

In Florida, there are four distinct proceedings (other states may be similar):

1. Formal Administration: This proceeding is used when there are considerable assets and it’s necessary to have a personal representative appoints to act on behalf of the estate.
2. Family Administration: When the beneficiaries of the estate are the surviving spouse and lineal descendants, and the estate is less than $60,000 for federal estate tax purposes, this proceeding is usually used.
3. Summary Administration: When the estate is not more than $25,000 or the descendent has been dead for more two years, a Summary Administration is the proceeding used most often.
4. Disposition without Administration: When the estate assets don’t exceed funeral expenses plus the cost of medical and hospital expenses, this proceeding is necessary.

Avoiding probate requires a good estate attorney and a great deal of planning. There are various ways to avoid probate, as reviewed below.

Generally it is necessary to go through probate or, in the case of smaller estates, a less formal procedure that is still under the general supervision of the probate court, before the deceased’s property can be legally distributed. As long as a person passes away with a Will intact, probate court allows others to object to that Will, and will determine if that Will is valid in spite of those objections during probate. It might be possible that (A) there was a later Will (which, if valid, would replace the older Will), or (B) the Will was made at a time the deceased was not mentally competent to make a Will, or (C) the Will was the result of fraud, mistake or “undue influence” or (D) the Will was not properly “executed”, or (E) the Will in question is a forgery, or (F) for some other reason (like a pre-existing contract) the Will is not 100% valid, or (G) there are numerous other claims against the estate that will affect what the beneficiaries will inherit under the provisions and requests under the Will.

No one will take part in any transactions involving such inherited property prior to the Will being admitted to probate and/or an appropriate party lawfully appointed to represent the estate. If the deceased owned real estate in his or her own name, no well-informed outside party or parties would assume title to the property, and no bank would sign-off on a new mortgage, unless the estate went through the process of probate in order for “clear title” to be approved for the new buyer.

Probate is used to legally transfer title of the deceased (decedent’s) property to his or her heirs and/or beneficiaries. If there is no property to transfer, there is typically no need to go through the process of probate. Another function of probate is to provide for the collection of any taxes due by reason of the deceased’s death or on the transfer of their property. Probate also provides a way to pay outstanding debts and/or taxes connected to the estate, for setting a deadline for creditors to file claims (which stops unpaid creditors from pursuing heirs or beneficiaries) and for the distribution of the remainder of the estate’s property to the decedent’s legal heirs.

During probate certain members of an estate might insist on contesting the Will, this is allowed by the courts. Probate is also necessary to validate the Will and ensure that the Will was actually written by the decedent and that the decedent was ‘of sound mind’ when he or she created the Will. Even though the decedent may have made it clear in the Will who the beneficiaries are, certain relatives may want to question the validity of the Will, and have the legal right to do so. This is an issue that would come under the probate process. If the decedent left a great deal of cash, bonds, stock and/or real estate in the estate, there is always the possibility that distant relatives may enter into the picture and claim a piece of the estate, whether the Will names them as heirs or not.

Probate is used to make sure the Will was not written or dictated under adverse influences or that the Will is not a fraud; that the Will was legitimately executed by the decedent – and that he or she was of sound mind when he or she wrote or dictated the Will. When determining the validity of a Will, the court must establish if the Will is actually the most up to date Will, and that there is not a more recent Will that would then invalidate the old Will. Probate is necessary for many reasons. It is also used to ensure that the estate left by the decedent is distributed fairly and legally, in agreement with the deceased’s requirements.

During the probate process, the value of the estate and assets of the decedent Will be confirmed as well as any liabilities the decedent may have: unpaid taxes, outstanding loans, mortgages and other debts. Probate allows legitimate creditors to file a claim to regain money owed to them. Probate guarantees that any assets, cash, bond, stocks, jewelry, valuables, real property, land, or business interests left to beneficiaries in the Will are legally reassigned to the beneficiaries during probate.

In short, probate guarantees that the estate is distributed fairly and properly, as dictated by the decedent’s Will.

The Uniform Probate Code, accepted by 18 states, specifies the rights of a surviving spouse when their spouse passes without a will. The rights include: If there are no parents, children, or grandchildren of the deceased spouse, the surviving one inherits the estate; if a parent survives, the surviving spouse inherits the first $50,000, then splits the remaining half of the estate with the parent(s); if a child or grandchild survives, the surviving spouse inherits the first $50,000 and then splits the remaining 50% of the estate with the child or grandchild. All states in the USA and the District of Columbia have enacted laws governing most aspects of estate planning and probate — legal validity of wills, creation of trusts, the probate process, and more. These laws can fall under various names, often as collections of laws called “codes.” The different estate and probate codes that can be found from state to state include “Decedents’ Estates,” “Trust and Fiduciaries,” “Estate Administration,” and the “Uniform Probate Code.”

One of the easiest ways to keep your money out of probate is a payable-on-death (P.O.D.) bank account. All you need to do is fill out a simple form, provided by the bank, naming the person you want to inherit the money in the account at your death. As long as you are alive, the person you named to inherit the money in a payable-on-death account has no rights to it. You can spend the money, name a different beneficiary, or close the account.

When you open a retirement account such as an IRA or 401(k), the forms you fill out will ask you to name a beneficiary for the account. After your death, whatever funds are left in the account will not have to go through probate; instead, the beneficiary you named can claim the money directly from the account custodian.

If you’re single, you’re free to choose whomever you want as the beneficiary. If you’re married, your spouse may have rights to some or all of the money. If you have a 401(k) account, your spouse is entitled to inherit the money unless he or she agrees, in writing, to your choice of someone else. If you live in a community property state, chances are your spouse owns half of what you have socked away in a retirement account. (Community property states are Arizona, California, Idaho, Louisiana, New Mexico, Nevada, Texas, Washington, and Wisconsin; in Alaska, couples can sign an agreement making some or all of their property community property.) If any of the money you contributed was earned while you were married, that money remains “community property,” and your spouse owns half.

The Uniform Transfer-on-Death Securities Registration Act allows you to name a person to inherit your stocks, bonds or brokerage accounts free of probate. It is similar to a payable-on-death bank account. When you register your ownership, either with the stockbroker or the company itself, you make a request to take ownership in what’s called “beneficiary form.” When the papers that show your ownership are issued, they will also show the name of your beneficiary.

With respect to your car – to name an automobile transfer-on-death beneficiary, all you need do is register the vehicle in a “beneficiary form.” The new registration certificate will list the name of the beneficiary, who will automatically own the vehicle after your death. States such as California, Connecticut, Kansas, Missouri, and Ohio offer car owners the option of naming a beneficiary, right on their certificate of registration, to inherit a vehicle. If you do this, the beneficiary you name has no rights as long as you are alive. You can sell or give away the car, or name someone else as the beneficiary.

Several methods of joint ownership, such as joint tenancy, provide a way to avoid probate when the first owner dies.

Many couples conclude that holding title to their major assets in a form of joint ownership that avoids probate is all the estate planning they want to engage in, at least while they are younger. The most attractive features of this strategy are its simplicity and economy. To take title with someone else in a way that will avoid probate, you usually don’t have to prepare any additional documents. All you do is state, on the paper that shows your ownership (a real estate deed, for example), how you want to hold title.

Joint tenancy with right of survivorship: Property owned in joint tenancy automatically passes, outside of probate, to the surviving owner(s) when one owner dies. Joint tenancy often works well when couples (married or not) acquire real estate, vehicles, bank accounts, securities, or other valuable property together. Setting up a joint tenancy is simple and free. However, setting up joint tenancy in Texas requires that all joint tenants to sign an agreement. If you wished to set up a joint tenancy bank account, specifying your arrangement on the bank’s signature card isn’t enough. A bank or real estate office should be able to give you a fill-in-the-blank form that will do the trick.

After one joint owner dies, generally all the new owner has to do is fill out a straightforward form and present it, with a death certificate, to the keeper of ownership records: a bank, state motor vehicle department, or county real estate records office.

Joint tenancy is usually a poor estate planning choice when an older person, seeking only to avoid probate, is tempted to put solely owned property into joint tenancy with someone else. Beware of certain issues…You are giving away part ownership of your property. The new owner has rights that you can’t take back. For example, the new owner can sell or mortgage his or her share — or lose it to creditors. You may have to file a gift tax return. If the value of the interest you give to a new co-owner (except spouse) exceeds $11,000 in one year, you have to file a gift tax return with the IRS (unless you’re adding a joint tenant to a bank account to which you deposited the money; in that case, no gift is made until the other person withdraws money). No tax is actually due, however, until you leave or give away a very large amount (currently, more than $1 million) in taxable gifts.

A great many people err on the side of adding a person as a joint tenant to a bank account strictly for “convenience.” sake. They want someone to help them out by depositing checks and paying bills. But after the original owner dies, the co-owner may claim that he or she is entitled, as a surviving joint tenant, to keep the funds remaining in the account. In some instances, maybe that’s what the deceased person really intended — it’s too late to ask.

Tenancy by the entirety: In certain states, married couples often take title not in joint tenancy, but in “tenancy by the entirety” instead. It’s very similar to joint tenancy, but can be used only by married couples. Both avoid probate in exactly the same way.

If you are married (California allows people to register with the state as domestic partners) and live or own property in Alaska, Arizona, California, Nevada, or Wisconsin, another way to co-own property with your spouse is through community property with the right of survivorship. If you hold title to property in this way, when one spouse dies, the other automatically owns the asset. Transferring title to the survivor is simple and doesn’t require court proceedings.

Revocable Living Trusts were invented to help people avoid probate entirely. The advantage of holding your valuable property in trust is that after your death, the trust property is not part of your estate for probate purposes. (It is, however, counted as part of your estate for federal estate tax purposes.) That’s because a trustee — not you as an individual — owns the trust property. After your death, the trustee can easily and quickly transfer the trust property to the family or friends you left it to, without probate. You specify in the trust document, which is similar to a will, which you want to inherit the property.