Most, if not all of you have probably heard about probate. However, not many people truly understand what probate is, or why we even have probate. This article will highlight some basic information on the probate process.
What is Probate?
Probate is the legal process used to transfer assets that were owned by someone who is deceased. Many asse4ts, such as your home and car, have a title that needs to be transferred. If the owner is deceased they obviously can not sign the title. Probate is the court process used to appoint someone to sign title documents and transfer property on behalf of the deceased person.
What Occurs During Probate?
To open a probate, a person files an Application for Appointment as personal representative with the Court. That application requests that the Court: (i) accept the decedent’s original Will for probate (if there is a Will), and (ii) appoint a personal representative to administer the decedent’s estate. The prospective personal representative must also file other initial documents to start the probate process.
The Court will generally appoint the person named as personal representative in the Will as the decedent’s personal representative unless the person is not qualified, declines, is unable or is challenged by an interested party. The Court will usually appoint a personal representative without a formal hearing.
If the Probate Court is satisfied that all requirements have been met and all information has been supplied, it will open the probate and issue a document known as “Letters Testamentary” by which the Court appoints the personal representative of the estate. The personal representative may give copies of the Letters Testamentary to people and entities to show that a probate was opened and that the personal representative has the authority to act on behalf of the estate.
The executor then makes an inventory of the estate’s assets, locates creditors, pays bills, files tax returns, and manages the estate assets. When all of the duties of the executor are completed, but not earlier than four months after the probate is opened, another petition is filed with the Court asking that the estate be distributed to the devisees or heirs. If this petition is granted, the probate is completed by distributing the assets to the devisees or heirs and filing final tax returns.
What are Probate Assets?
Probate proceedings involve only assets commonly referred to as “probate assets.” Probate courts do not have jurisdiction over and cannot administer assets that are not probate assets. Probate assets include all real property and personal property, including intangible personal property:
- in which the decedent had an interest at the time of death, and
- that are not transferred by operation of law or by contract to a person or entity.
The decedent must have had an interest in the property at the time of death or the property is not a probate asset.
Can I avoid Probate?
As the Probate court only has jurisdiction over probate assets, probate is not necessary if you do not own any probate assets at the time of your death. This can be partly accomplished by owning property jointly with rights of survivorship, or by using beneficiary designations on property. The most common way to avoid probate is to use a Living Trust to own your assets during your life. Contact our office to find out more.