Probate and Trust Administration
Administering a loved one’s estate
When a loved one passes away, their estate often goes through a court-managed process called probate or estate administration, during which the deceased’s assets are managed and distributed. If your loved one owned their assets through a well-drafted and properly funded living trust, it is likely that no court-managed administration is necessary, though the successor trustee still needs to distribute the deceased’s assets. The length of time needed to complete the probate of an estate depends on the size and complexity of the estate and the local rules and schedule of the probate court.
Every probate estate is unique, but most follow these steps:
- Filing a petition with the appropriate probate court.
- Notifying heirs under the Will or statutory heirs (if no Will exists).
- Petitioning to appoint an Executor (if there is a Will) or an Administrator for the estate.
- Initiating an inventory and appraisal of estate assets by the Executor or Administrator.
- Paying estate debt to rightful creditors.
- Selling estate assets.
- Paying estate taxes, if applicable.
- Distributing assets to heirs.
Frequently Asked Questions
What happens if someone objects to the Will?
An objection to a Will, also known as a “Will contest,” is a fairly common occurrence during the probate process and can be incredibly costly to litigate.
To contest a Will, one must have legal “standing” to raise objections. This usually arises, for example, when children are to receive disproportionate shares under the Will or when the distribution scheme changes from a prior Will to a later Will. In addition to disputes over tangible distributions, Will contests can also involve quarrels over the person designated to serve as Executor.
Does probate administer all property of the deceased?
Probate is primarily the process by which title is transferred from the deceased’s name to the beneficiaries’ names.
Certain types of assets, called “non-probate assets,” do not go through probate. These include:
- Property held in “joint tenancy with right of survivorship.” Such property passes to the co-owners by operation of law and does not go through probate.
- Retirement accounts, such as IRA and 401(k) accounts, with designated beneficiaries.
- Life insurance policies.
- Bank accounts with “pay on death” (POD) or “in trust for” designations.
- Property owned by a living trust. Legal title to such property passes to successor trustees without going through probate.
Do I get paid for serving as an Executor?
Executors are reimbursed for all legitimate out-of-pocket expenses incurred in the management and distribution of the deceased’s estate. In addition, you may be entitled to statutory fees, which vary by location and the size of the probate estate. The Executor must fulfill their fiduciary duties on behalf of the estate with the highest degree of integrity and can be held liable for mismanagement of estate assets in their care. It is advised that the Executor retain an attorney and an accountant to advise and assist with their duties.
How much does probate cost? How long does it take?
The cost and duration of probate can vary substantially based on factors such as the estate’s value and complexity, the existence of a Will, and the location of real property owned by the estate. Will contests or disputes with alleged creditors over the estate’s debts can also add significant cost and delay. Common estate expenses include executors’ fees, attorneys’ fees, accounting fees, court fees, appraisal costs, and surety bonds. These typically add up to 2% to 7% of the total estate value. Most estates are settled through probate in about 9 to 18 months, assuming no litigation is involved.