Probate is sometimes made out to be a villain for estate planning purposes. You often hear about "avoiding probate" as if it were a disease, but in fact the vast majority of cases pass through probate without issues. Undoubtedly, you can control what assets are subject to probate and there is some benefit to ensuring that certain property can be passed directly to your heirs, but in most cases, probate cannot be avoided entirely. Probate consists of four simple steps, so read on for more information about how probate works.
1. File the will with the courts. This step, also called petition filing, is the legal beginning of the probate process. Notice will be sent to potential heirs or beneficiaries and an executor will be officially named. Heirs and beneficiaries will be given an opportunity to object to any portion of the will, which will trigger a hearing. A notice to potential creditors, who may have an interest in the estate, will be printed in a local newspaper for a specific period of time, specified by state law. The will is now a public document.
2. The personal representative, or executor, performs an inventory of all assets and debts. This inventory includes real estate, stocks and bonds, vehicles, art, jewelry, etc. A professional appraiser may be appointed if required by state law or if the estate is large and complicated. The executor may also wish to hire an appraiser to do the inventory.
3. The executor takes an accounting of all debts and taxes owed, including any funeral and burial expenses, and pays them. The executor is allowed to use any available funds, such as bank accounts, to pay the debts of the estate and is also permitted to sell assets if necessary to accomplish this task..
4. The final step is the distribution of assets as proscribed by the will. Each state has a waiting period that allows any creditors to place a claim on the estate. Once that period has passed, the executor is tasked with transferring the assets according to the decedent's wishes. The petition becomes final and includes an accounting of all estate monies spent by the executor during the probate period.
The transfer of assets now takes place. Deeds are changed to reflect new ownership, titles to vehicles are updated, and the actual handing over of personal property occurs. While the executor is primarily still responsible to oversee this distribution, the heirs and beneficiaries, armed with the probated will, now have the power to have property transferred to their own names.
Having a properly drawn will that is updated often can be the key to ensuring a smooth probate experience. Consult with your financial planner and your estate attorney for guidance on the formation of your will and other important estate planning documents. For more information about estate planning, contact a professional like Cadwallader Law Offices.