Probate Discussion

By Mark T. Coulter, Esquire
Estate Planning Attorney

What is Probate?

Probate is the process to transfer ownership of a person’s assets after their death, under the supervision of a court. Probate establishes the validity of a person’s will, appoints someone to implement the will, and distributes the assets of the estate under the terms of the Will. This process is intended to protect the right of the family, heirs, beneficiaries and creditors of the deceased. Final bills are paid, accounts are reconciled, taxes are resolved, and property then passes to the appropriate people or organizations free of any claims or liabilities.

What is an Executor or Administrator?

Every will should name a personal representative, called an executor, who will take charge of the decedent’s estate. If a person doesn’t name an executor in their will, then the Court will select someone to do the job. This person has responsibilities imposed by law, and by the will, regarding the decedent’s affairs. In a nutshell, they have to locate and collect all of the decedents assets and liabilities, watch over all of the assets until probate is completed, make sure that the wife and children are treated properly under the will and state law, pay everyone who was owed a debt by the decedent, file necessary tax returns and probate expenses, and properly distribute all of the assets remaining to the appropriate people. As you can see, is an important, and potentially time consuming, job.

Should I have an attorney take care of probate duties?

An attorney can be of great assistance in probating a will. Some people go ahead and name us as their Executor, assuring that a professional, experienced person will handle the duties. Other times, an Executor hires us to assist them in their duties. That level of assistance can vary from answering a few questions, to taking over virtually all of the paperwork, phone calls, court filings, tax and accounting work, distribution, notice and other responsibility which otherwise is on the Executor’s shoulders. In the event that formal court probate proceeding are required, an attorney must represent the executor. Finally, remember that court personnel, like probate clerks, can not, and will not, give legal advice.

Do all of my assets need to go through probate?

Probate may be required for all, some, few, or even none of your assets, depending upon your estate planning. For example, property owned jointly with a spouse or someone else does not pass through probate, but instead goes to the survivor. Your retirement funds may escape probate if properly handled, or may pass through your estate and probate due to careless planning. Many other examples exist of ways to avoid probate for most, if not all, of your assets, if that is important to you. Remember, however, that avoiding probate does not mean avoiding estate taxes; the two operate largely independent of one another.

Why might I want to plan to avoid probate?

There are a variety of reasons why people choose to structure their plan to avoid probate. For one, probate is a public proceeding, so your assets, will structure, and beneficiaries are made public records at the courthouse. Further, there can be expense, delay and inconvenience for your loved ones while the probate proceeds. Some people would rather shoulder that burden for their family while they are alive, such as by a Living Trust, to streamline and privatize the task of winding up your financial affairs.

What are taxes connected with probate?

Whether your assets go through probate or not, various taxes are, or may be, due on the assets of a decedent. We have a separate pamphlet which discussed those in greater detail, but generally, there are taxes due to the federal government for Estate Tax, Gift Tax and/or Generation Skipping Tax, along with the final income tax return for the last year of the decedent’s life, and income tax which may be due on income earned on the decedent’s assets during probate. State taxes, in the form of Estate Taxes (on the decedent’s estate) and/or Inheritance Taxes (based on the beneficiaries’ receipt of inheritances), can be due. With advance planning, many of these tax issues can be minimized, or even eliminated entirely from your probate proceedings and estate.

How can I avoid probate?

With Estate Planning Center options, you can reduce or eliminate probate proceedings. Joint Ownerships, Transfer on Death accounts, Contract Beneficiaries, Revocable Living Trusts, Life Insurance Trusts, Grantor Retained Annuity Trusts, Personal Residence Trusts, and many other options exist to limit the scope of probate.

Will probate proceedings delay my estate?

In a nutshell, yes. The length of delay which probate adds to winding up your affairs, however, depends on a number of factors. Principal among these are the size and nature of your estate, the amount of planning you’ve done in advance, and the professional skill (or lack thereof) of your executor and/or attorney. Much of the delay people experience in probate is simply the result of a lack of aggressive action to keep things moving forwards promptly.

About Our Law Office

At the Estate Planning Centers at Coulter & May, P.C., we devote our practice to estate planning and assisting families through such transition times with estate and trust administration counseling. We offer guidance and advice to our clients in every area of estate planning, and offer comprehensive and personalized estate planning consultations. For more information or to attend an upcoming seminar or to book a consultation directly, please contact us at (412) 253-7526 or visit us online at www.estateplanningcenters.com.

Disclaimer: The information presented in this article is a conversational summary of a complex area of law and should not be construed to constitute legal advice. No person should rely upon the content of this article for making any decisions, and should instead consult with appropriate legal and tax professionals.