Probate is the legal process that ensures your debts are paid and legal title to your assets is transferred to the appropriate heirs and beneficiaries. If you have a will, the probate process will determine whether the will is authentic and valid. During the process, an executor will be appointed to administer the estate.
Probate can take anywhere from a few weeks or months to years to wind up the estate. Probate is necessary to wind up all estates, but having a last will and testament can speed up the process and reduce complications.
The last will and testament becomes part of the public record in the county’s Register of Wills or similar public record. To object to the validity or terms of the document submitted to the probate court as the last will of the deceased, the objections must be raised early in the probate process.
Usually, more complicated estates will hire a probate lawyer, or probate attorney, to smooth out the process. However, hiring a probate attorney usually is not required. No state required an attorney to be involved in probate, but some cities and counties do. In many estates, the executor of the estate can handle the probate process without an attorney’s help, but the executor should consider consulting an attorney when clarification about the process is needed.
The probate process starts with the filing of the initial probate forms and documents to the probate court after the testator has passed. The names and content of the documents required to start the probate process vary around the country but most often are called a petition to open probate. Usually the initial filing must include the death certificate and the original version of the last will and testament. The executor also might be required to show he or she issued a formal notice of probate to all interested beneficiaries and heirs.
Once the initial documents are filed, a date is assigned for the first court hearing.
At the first hearing the court usually formally appoints the executor and authorizes him or her to act on behalf of the estate. This often is known as grant of probate. After receiving a grant of probate, the executor must obtain a federal tax identification number for the estate. The estate can’t conduct business using the deceased’s Social Security number or other taxpayer ID number. In addition, the executor should open a bank or financial account for the estate.
Also at the first hearing, the court decides whether to declare the will submitted to the court to be valid. The executor might be required to present to the court one or more of the witnesses to the will to testify that he or she did witness the deceased sign the document. This part of the process, known as proving the will, usually is a formality. But if someone challenges the validity of the will or submits a different will to be considered by the court, the process could be more significant. There might be one or more additional hearings at which witnesses and evidence are presented and the merits of the will are discussed before the court rules.
In some states, the executor might be required to post a probate bond. A probate bond protects the beneficiaries and beneficiaries against any errors or malfeasance that occur in settling and distributing the estate. The insurer issuing the bond promises to compensate the beneficiaries and creditors for any money lost in those circumstances. Most states also allow this step to be waived, and your will can state that posting bond will be waived.
After the first hearing, the executor must prepare an inventory of the deceased’s assets and liabilities and assign values to the assets. Some property might have to be professionally appraised, but most types of property don’t need a formal appraisal. Some courts have specific forms on which the inventory is to be submitted.
All states require the executor to notify creditors and potential creditors that the estate is in probate. Some states require the executor to make an attempt to identify potential creditors and notify them individually. Others require only that a public notice be published. In either case, the notice must inform the creditors how to submit claims against the estate and what the deadline is. The executor evaluates each bill or claim submitted and decides whether or not it should be paid. If the executor denies a claim, the creditor can appeal that to the probate court.
The executor also needs to determine if any taxes are due by the estate, including federal estate and income taxes, state estate and income taxes, local property and income taxes, and any other types of taxes. The executor must prepare and file any tax returns due and pay the appropriate taxes.
They might sell some property in the estate. Sometimes the deceased directs the sale of property in the will. At other times, the executor needs to sell property to pay bills. And sometimes the executor decides the best way to settle the estate is to sell as many of the assets as possible and distribute primarily cash to the beneficiaries.
The details of asset sales vary from state to state. The executor might have to obtain approval from the probate court before selling, giving beneficiaries and others with an interest the opportunity to object to a sale. Or the executor might have discretion to sell assets.
At this point the executor is ready to make a final accounting to the court. The executor shows the assets that were in the estate and how they were used to pay debts and taxes. Receipts and financial records proving the transactions might have to be presented. The executor also presents a final distribution plan to the court. If the plan is approved, the remaining assets in the estate are distributed to the beneficiaries according to the plan, which should follow the deceased’s will.
It’s important that the executor not distribute the assets and close the estate without authority from the court. If he or she does, any creditors who later make claims, including tax authorities, might be able to hold the executor personally liable for unpaid debts and taxes.
Valuable contributions to this summary of “How to Probate a Will Without An Attorney” were made by Bob Carlson, editor of the Retirement Watch financial advisory service and chairman of the Board of Trustees of Virginia’s Fairfax County Employees’ Retirement System with more than $4 billion in assets.
Katie Kao is an editorial intern with Eagle Financial Publications.