What is Probate?
Probate is the legal process of administering an estate after a person dies. Handled by a probate court, it resolves all claims and distributes the deceased person’s property. During the process, the court officially appoints a representative (an executor); this person is usually named in a will. The executor has the legal power to distribute assets in the manner outlined in the will. For example, the executor will manages grandma’s estate, distributing her property to designated grandchildren according to her last wishes.
If a person dies with a will (referred to as “testate“) or died without a will (referred to as “intestate”), probate is a necessary process unless the decedent created a living trust. Probate administration can be a confusing and lengthy process. It can also be costly, so you want an efficient and knowledgeable attorney to guide you and your loved one’s estate through the probate courts.
How is one’s assets distributed in Probate?
If the decedent left a will, then an estate’s assets are distributed in accordance to its instructions. It gets more complicated if the decedent did not leave a will. In situations where a will is absent, distribution of assets depend on the nature of the deceased’s property. For example, if the property is characterized as community property, it will pass to the surviving spouse. However, if the property is determined to be “separate property,” then its distribution is more complicated and is best explained in a consultation.
How much does Probate cost?
Fortunately probate attorney fees are set by law and subject to court order. Probate fees are based on the gross value of the probate estate. For example, if the estate is valued at $750,000, the probate fee is $18,000. In addition to attorney fees, there is an executor’s fee; it is computed the same way as the attorney fee. So, for an $750,000 estate, total fees are $36,000. As you can see, probate fees can quickly add up to a sizable amount. It’s best to consult a qualified attorney to estimate associated fees. Better yet, having an estate plan in place, including a living trust, will avoid probate and its associated costs.
How can you avoid Probate?
Taking steps to avoid probate must be taken before a person dies. The best way to avoid probate is estate planning, putting legal documents in place that determine how your assets are managed in life and after death. As we mentioned, probate fees are set by law. That’s why having a living trust is so important; it’s like a gift to your loved ones. You free them from the expense and hassle of probate. For small estates — those total value under $150,000 (as of 1/1/12) — probate can typically be avoided. Other arrangements that avoid the Probate process are:
- Living Trust
- Life Insurance*
- 401K plans*
- Profit and Pension Plans*
- Retirement Plans*
- Joint Tenancy Property
*Provided that a beneficiary is named in the plan.
Representation for Executors & Trustees
Hanley Law has experience in representing Executors, Trustee(s) and/or Trust beneficiaries in the process of the Probate Administration and Trust Administration (non-probate related). The Probate process can take from six months to a year — perhaps longer if there is litigation. Once an estate begins the probate process, there are numerous steps to be followed, like:
- Filing a Petition to Probate in the Superior Court. Heirs are notified and the Court appoints an executor (if a will) or an administrator (if no will) to distribute the Estate
- Publishing a legal notice in a local newspaper to advise creditors of the Probate proceeding
- Collecting all of the decedent’s assets and file an inventory with the court
- Reviewing and resolving any creditor claims against the estate (may require additional legal proceedings if claim is disputed)
- Settling and distributing the estate once court approval is received
The above list is not exhaustive, meaning there may be additional steps depending upon the complexity of an estate. In addition to trust and probate administration, we also offer estate loans.