Understanding Probate

End of Life Management Toolkit #3 | by Team Passare and Robert L. Shepard

1. What is Probate?

The first step to understanding probate is defining it. Probate is a court-supervised process to transfer property to your beneficiaries upon your death as directed by your will. In a probate proceeding, the court oversees identifying your property, paying debts, locating your heirs, and distributing property to those heirs. The actual work is taken care of by the executor of the will. The executor may be a trusted person, bank trust department or other professional service. In either case, the executor needs the assistance of an experienced estate planning attorney and an accountant.

The probate process covers two separate activities.

  • Probating the Will: Establishes the validity of the will and appoints a personal representative.
  • Administering the Estate: Implements the provisions of the will under the jurisdiction of the probate court.

The probate court also handles mental incapacity determinations, guardianship, and conservatorships of adults. As part of this second function, the probate court may appoint a conservator for an incapacitated person, and after death, administer that person’s estate for several years more.

During the probate process, nobody has access to the assets until an executor is named. Will contests are most often over this very issue. Once named, only the executor has access to the probate estate, and only for the purpose of completing the probate process. The executor may be held personally liable if they distribute assets before the court approves the final process, even if the recipient is the ultimate beneficiary of that property. The probate assets do not become the property of the beneficiaries until the probate process is complete and the court approves the final distribution.

7 Steps to Understanding Probate Processes
  1. Probate starts by someone (typically the executor) filing a probate petition, along with a copy of your will. The attorney represents the executor named in the will or, if there is no will, your spouse or child, steps in to do the job.
  2. Copies of the petition are sent to everyone named in the will as well as all the intestate heirs. A copy of the petition must be published in a local newspaper.
  3. Four to six weeks after the petition is filed with the court, the court holds its first hearing to determine who shall be named as executor or administrator of the estate. When there is no will, the term “Administrator” is used instead of executor.
  4. Once the executor or administrator is chosen, anyone who believes you owed them money must file a creditor claim.
  5. The executor or administrator then marshals your assets, and evaluates the creditors’ claims. Valid claims are paid. There may or may not be litigation over disputed claims.
  6. Once all the claims are resolved, all the assets have been properly appraised and evaluated, and any challenges to the will itself have been resolved, the executor or administrator then proposes a distribution plan to the court.
  7. Once the court approves it, the estate is distributed and probate is closed.

Helpful Hint: Upon your death, only your probate property is subject to the probate process. Life insurance, retirement accounts, and jointly held property with right of survivorship, all pass automatically to your beneficiary without court confirmation. Any property held in a living trust is not subject to probate.

Now take a few minutes to answer these questions:
  1. What arrangements have you made for an executor, attorney or accountant to manage your estate when you pass?
  2. Can your estate pay for the probate court, administrator (executor), attorney or accountant?
  3. What possible claims to your estate could pose a problem after your death? What can you do now to resolve these issues?
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