Probate law is an area of the American judicial system which handles estate matters. Effectively, if you or a family member passes away, probate court deals with any and all legal matters associated with your assets or liabilities that are left behind.
Probate law refers to the legal process that gives someone, the executor, the power to distribute assets as laid out in a will. It is also probate law that determines the validity of a will.
Probate laws dictate the rules for many issues, and in the event that the rules are not followed,the courts have ways to rectify the problems that may arise. Probate laws work in the following ways:
When a deceased person's trust or will has an appointed executor, that person functions as the personal representative for the deceased person. That means if the decedent owned personal property, such as a house or a life insurance policy payable upon death, the appointed executor will be responsible for transferring money and closing any bank accounts. The executor must follow the decedent’s wishes that are stated in the will in order to distribute the assets appropriately and according to the decedent’s wishes.
Probate is applicable to any situation where someone dies and their assets have to be distributed, whether it is to their family, friends, or their favorite nonprofit foundation.
Probate cases can become very complicated when in some circumstances. For example, when a change to the will is made at the last minute. People tend to view this suspiciously and might go to court to contest the will, arguing that the deceased person changed the terms of the will under duress or when they weren't of sound mind. This can happen when a new caregiver steps in for the final years of someone's life and the decedent suddenly leaves all of their assets to that caregiver instead of the family.
The basic steps of probate are initiated whenever somebody dies and their money and property in the estate has to be distributed. The distribution process requires several steps including the following:
The first step takes place before probate is even initiated. This step requires determining who the personal representative is going to be. Most wills include a section or a provision that stipulates who the executor of the estate or personal representative will be. If the will doesn't list a personal representative, or the person who died doesn't have a will at all, probate court might choose a close family member or surviving spouse as the personal representative. That individual takes legal possession of any and all assets belonging to the deceased, and they are then responsible for following the next steps and distributing everything accordingly.
Next, there must be a petition filed with the state court. That petition has to be filed in the county where the decedent lived when they died. This will result in a hearing to be scheduled within 30 days. The scheduling process can take longer in some states, depending on the court’s availability, and the process varies from state to state as well. However all states require that a petition be filed.
After the petition has been filed and the courts have been made aware of the death, everyone else has to be made aware too. This notice of the hearing must be published so that all of the family members, heirs, and creditors to whom the deceased might still owe money are aware that they passed and that the estate has gone to probate. Notice has to be given to potential creditors and everyone specifically listed in the will. In the event that there is no will, a notice must be mailed to all potential legal heirs. In some states, such as California, it’s required that the notice of the probate hearing be published at least three times in a newspaper where the deceased lived when they passed.
The personal representative or executor is responsible for collecting any and all property under the estate. Not all property is necessarily subject to probate. For example, if there is a home or a car that has to be transferred to someone else, the personal representative is responsible for transferring that. The courts will require the personal representative to supply an inventory of all estate property, within reason. This doesn't mean the executor has to provide the court with a detailed list of every single knick-knack the deceased owned.
Any legitimate debts that are still owed must be paid. Creditors can submit a claim within a few months of the estate going into probate. If they are valid, then they get paid by the money or assets that are still a part of the estate before everything gets distributed to the heirs.
If there are any income taxes or estate taxes, they must also be paid before any money is distributed to beneficiaries. If there are unpaid taxes, the personal representative is not liable on a personal level. However, if taxes were not paid and the estate has been distributed anyway, leaving not enough money to pay any remaining taxes, there can be legal ramifications for the personal representative.
The final step is to close out probate. Once all the transactions have taken place, the personal representative submits an invoice of those transactions to probate court. They file a petition with the court that summarizes all the actions they took and any fees they paid. This includes listing the fact that they paid themselves and an estate attorney as well, if applicable. If there are accounting objections made by heirs or beneficiaries, the court will decide whether they are valid.
The process for probate depends on how complicated the estate is, but it can take an average of six to nine months. Some estates can be processed in a matter of weeks, while others might take a few years.
So what slows things down?
In probate court, an individual is appointed to collect all of the assets, pay off all of the debts and expenses, and then distribute what is remaining to the beneficiaries or the heirs.
You can work proactively to avoid probate after your death by utilizing estate planning. Estate planning must follow state law, and helps you create a legal document for the proceeding upon your date of death. The more efficient and well-planned your estate planning, the more likely it is that your assets can be distributed to any beneficiaries in a hassle-free environment without having to go through probate.
A good tip to avoid problems with probate law is to set up an ironclad will. A law of wills necessitates that you have instructions for all of your assets, otherwise they will end up in probate, distributed by the courts. There are several probate cases where a will might clearly explain where half of the assets should go but not the other half, in which case everything gets tied up in court.
Depending on where you live, your will might need to be notarized and you may need witnesses in order for it to be valid. Making sure that you do that ahead of time will help you stay on the right side of the law and make it much easier for your family and beneficiaries when you pass. Make sure that you follow all probate laws by appointing an Executor who will be personally responsible for your legal document. Also make sure they are someone who can handle the responsibility, and have a backup listed just in case the first person is unable to complete the responsibility.
The laws for probate in each state are slightly different, which is why it is recommended that if you are trying to start the probate process or you need to know how to contest a will, you work with an attorney. Thankfully, most probate proceedings don't take very long and they aren't particularly expensive compared to most other areas of managing an estate.