Probing Probate: What You Should Know
Probate is a term that is used in several different ways. Probate can refer to the act of presenting a will to a court officer for filing — such as, to “probate” a will. But in a more general sense, probate refers to the method by which your estate is administered and processed through the legal system after you die.
The probate process helps you transfer your estate in an orderly and supervised manner. Your estate must be dispersed in a certain manner (your debts and taxes paid before your beneficiaries receive their inheritance, for example). Think of the probate process as the “script” that guides the orderly transfer of your estate according to the rules. (For more info, see What’s a Probate Estate All About?)
Many people think that probate applies to you only if you have a will. Wrong! Your estate will be probated whether or not you have a will.
– With a valid will: If you have a valid will, then your will determines how your estate is transferred during probate and to whom.
– Without a valid will: If you don’t have a will, or if you die partially intestate, where only part of your estate is covered by a valid will, the laws where you live specify who gets what parts of your estate.
So read on for a few important points about probate you need to know.
The probate process
Even though you won’t be around when your estate goes through probate (after all, you’ll be dead), you need to understand how the probate process works. At the most basic levels, the probate process involves two steps:
– Pays debts you owe
– Transfers assets to your beneficiaries
A state court called the probate court oversees the probate process.Because probate courts are state courts and not federal courts, the processes they follow may vary from one state to another. Yet despite their differences, these courts all pretty much follow the same basic processes and steps, which typically include:
– Swearing in your personal representative
– Notifying heirs, creditors, and the public that you are, indeed, dead
– Inventorying your property
– Distributing your estate (including paying bills and any taxes)
Swearing in your personal representative
In your will, you name who you want to be your personal representative — that is, the person in charge of your estate after you die. However, the court determines the personal representative for your estate under the following circumstances:
– You die without a will.
– You have a will but for some reason didn’t specify who you want to be your personal representative.
– The person you selected has died or for some reason can’t serve — and you didn’t “bring in someone from the bullpen” to replace your original choice.
A family member, such as your spouse or an adult child, can request that the court appoint him or her as the personal representative for your estate. Regardless of who is finally selected, the court gives your personal representative official rights to handle your estate’s affairs. As evidence that this person has the authority to act on behalf of your estate, the court gives your personal representative a certified document called the Letters of Administration or Letters Testamentary.
In either case, the personal representative named in your will or determined by the court has to first be formally appointed by the court before officially entering into office (the term that’s used). Usually this involves that the personal representative take an oath of office, after which he or she will then receive the official documentation showing his or her status (the Letters of Administration or Letters Testamentary we mention above).
Your personal representative files a document called a Petition for Probate of Will and Appointment of Personal Representative with the probate court. This petition begins the probate process. If you have a will, the probate court issues an order admitting your will to probate. Basically, the court acknowledges your will’s validity. (Check out Status of Your Will: Testate or Intestate? to get the lowdown on how the law sees your will.)
Notifying creditors and the public
Some state laws require your personal representative to publish a death notice in your local paper. The death notice serves as a public notice of your estate’s probate and enables people who think they have an interest in your estate (such as creditors) to file a claim against your estate within a specified time period.
The notice is part of the process to make the matters of your estate part of the public record. Some people view the general public’s ability to review your private estate matters as one of probate’s disadvantages.
Inventorying your property
The personal representative must inventory the different types of property — real and personal — that make up your estate so that your estate value can be determined. This inventory is important for a couple of reasons:
1. To make sure you left enough to cover your debts and distributions to beneficiaries: If your estate doesn’t meet the monetary obligations of both your estate creditors and your property transfers to your beneficiaries, it’s subject to abatement statutes, meaning that one or more beneficiaries may receive less than you had wanted or even nothing at all.
2. To ensure that all property is accounted for. Your personal representative is in charge of collecting and inventorying your estate’s assets to make sure that all property is available for distributing at the end of the probate process. (Your beneficiaries, of course, will want to know what assets are in your estate.) If property is missing or not in your ownership at the time of your death, ademption statutes become relevant. These statutes determine if a replacement asset or cash equivalent should replace the missing property intended for your beneficiary.
You should already have a pretty good idea of what your estate is worth so that you can make intelligent choices for your estate plan. Obviously, your personal representative needs to know this information, too. So make sure that your personal representative has easy access to the list that shows what your estate includes and what your assets are worth. Even a slightly out-of-date list can serve as a starting point so that your personal representative doesn’t have to create an inventory from scratch. (The Essentials of Marshalling Estate Assets shows you what your representative will have to do after you pass away.)
Distributing the estate
The final step in the probate process is the distribution of your estate property. In other words, everyone (ideally) — both your creditors and your heirs — gets what’s coming to them.
Creditors that have a valid claim are likely to be paid in the following order (though the order varies from state to state):
1. Estate administration costs (legal advertising, appraisal fees, and so on)
2. Family allowances
3. Funeral expenses
4. Taxes and debt
5. All remaining claims
Whatever’s left after your creditors get their money is distributed to your heirs or to the beneficiaries you named in your will. If you died without a will, the laws in your state determine how your property is distributed.
If probate proceeds according to plan and all notices and communications are properly handled, your personal representative is usually protected against any subsequent, late-arriving claims. Your personal representative will be protected after some specified time period expires.
Some complicating factors to the probate process
Some probate processes can be relatively straightforward, while others can be particularly complicated depending on how complicated an estate is. The following sections describe some of the more common complicating factors about probate that you will likely encounter.
What’s probated where: Differences between states
All states have probate, and all the types of property that make up your estate — real and personal — may be part of your estate’s probate. Tangible and intangible personal property, like your collectibles and your stock portfolio, are probated in the state where you live, but your real estate is probated where the property is actually located. So if you live on a farm in Pennsylvania and also have a vacation condo in Florida, you’ll have two probates.
Probate or not: Differences between types of property
Another common misconception is that probate applies to all of your estate. Actually, probate handles the processing of all assets in your probate estate. Your probate estate is made up of all the property that’s distributed through probate; the remaining property is called nonprobate property.
In a general sense, probate assets are those you own alone, while you own nonprobate assets jointly with others and to whom those assets will pass automatically upon your death. Nonprobate assets also include assets that pass to a named beneficiary: a life insurance policy, for example. Because these nonprobate assets pass to someone automatically, there is no need for probate.
The proven Buenos Aires – Argentina same probate lawyer professionals at the Kier Joffe law firm have experience working with foreign clients involved in probate cases in Argentina. Buenos Aires Argentina attorney professionals are knowledgeable in all areas of probate law, including but not limited to probate process in Buenos Aires Argentina. International clients will have the confidence of knowing that the case is being handled by an experienced and knowledgeable Buenos Aires probate lawyer in Argentina.