Your Comprehensive Guide to the Probate Process
If someone you love dies and they weren’t prepared, you may have to go through the probate process. Learn what that means in this post.
When Aretha Franklin died on August 16th, 2018 at the age of 76, music lovers wept. She was a platinum recording artist with numerous Grammy awards and had produced some of the worlds most beloved songs.
Shockingly, at the time of her death, there was no trust or will in place to handle her multi-million dollar estate.
Even the rich and famous are uncomfortable discussing and planning for their inevitable death.
Without a will or trust, your family will have no tangible evidence of your wishes after death.
When a family member passes, the period after their death and until their estate is settled is called probate.
What is the probate process? What happens in probate court? Here PB Ritz a Sydney Probate Lawyer gives you a comprehensive breakdown of the process and how to manage it in a time of grief.
Your Comprehensive Guide to the Probate Process
At the time of a passing of a family member, the last thing you want to think about is getting a lawyer. You and your family are in pain and grief. You already are having a hard time getting up every day, let alone going through paperwork and worrying about money.
But, when your loved one has died and you realize that they don’t have a will or trust, what do you do now? This can be a confusing question for people who have never gone through something like this before.
What are your next steps? How do you get help? What are you required to do? Let us help you understand what probate is and how to go through it.
What Is Probate?
In simple terms, probate is a legal process where the deceased’s estate is proven via will or other measures.
During probate, all of the deceased financials will be gone through, final debts and taxes will be paid, and whatever is leftover in the estate will be evenly distributed among any heirs and beneficiaries.
The probate process requires the use of probate lawyers to make sure you understand the complete scope of the process.
Especially in the situation where no will or trust has been left, a lawyer can help you with what paperwork you need to provide and what next steps should be.
What Happens In Probate Court?
The first step in the probate process is to authenticate the validity of the descendant’s last will and testament. The judge will affirm or deny that it is real and valid and the last known wishes of the individual.
If there is no will then they move on in the process to assign an executor. The definition of an executor is “a person who produces something or puts something into effect.” In this instance, they start the ball rolling on proving the estate and being responsible for handling the probate process.
Once the executor has been assigned they will have the responsibility of collecting all of the descendants financial information. They will confirm the values of all of these assets as of the date of death.
Any life insurance policies or other insurance policies will also have the claims filed on them by the executor. Once all the monies have been collected it is the executor’s job to manage and protect the assets until the end of probate.
Identifying Known Creditors and Debts
This step could be considered one of the most intensive for some estates. There are a number of steps the executor must take to guarantee they are not knowingly leaving debts unpaid.
The first debts to be paid are the actual death expenses. This would be final medical bills, for instance, if the deceased was hospitalized up until the date of death or was taken care of with an in-home aide. Next, would be any funeral expenses.
Once those debts are paid the executor must make an attempt to notify all creditors of the passing so they have a chance to make a claim on the estate. Most of the time this is accomplished by placing an ad in the newspaper or an online source announcing the death.
After due diligence has been done to allow creditors to make claims and all known debts are paid, creditors have two years to make claims on the estate.
If there is nothing left in the estate after the initial debts are paid than the estate becomes insolvent. Any creditors that make claims once the estate has become insolvent will have to write off the debts. These debts are not required to be paid by the executor or any heirs.
The executor can also file a request to close the window where claims may be made by creditors if a good amount of time has passed and no claims have been received.
Filing Final Taxes
The executor of the estate has the responsibility of filing the final personal taxes of the decedent and the estate taxes as well. If the estate is subject to any sort of taxes they need to be filed in a timely manner following the death. The personal taxes can wait until regular tax season.
These taxes must be paid from the estate either from cash reserves or by liquidating physical assets.
After each step, your attorney will petition the court and advise the judge that things are being accomplished and the executor is fulfilling their obligations. At the end of probate your attorney will provide all the information to the judge and then they will issue a closure of probate.
Once probate has closed the executor is free to distribute inheritances.
Distributing Inheritances
When you think about inheritances most think of intense, dramatic scenes we have seen on TV and in movies. Someone punches someone else and shouting matches occur. Fortunately, this isn’t how these situations normally play out in real life.
After the probate period has ended, and the executor has fulfilled their other duties, they are tasked with distributing the inheritances.
If there is a will, the executor will follow the instructions put forth in it. In the absence of a will, the remaining assets of the estate will be divided equally among all rightful heirs.
The assets are distributed in this order:
- Spouse
- Children
- Other Relatives By Order Of Genetic Closeness
If a spouse is living all the remaining assets will go to them. In the event, the spouse has already passed the entire remaining estate will be split evenly between any children. If there are no children the remaining estate gets split between the next level of all living relatives, and so on.
Is There A Way To Avoid Probate?
Most think that the presence of a will avoids the probate process. But, with or without a will probate will occur.
However, there is a way you can make your death simple and straightforward for your heirs. Set up a trust.
Setting up a trust has a number of complicated steps and can be some expense. This is all worth it in the end especially if your estate is large and/or complicated.
Your first step to creating a trust and getting your affairs in order for your eventual passing is finding a good family lawyer. Having a lawyer for these matters is invaluable because they will be able to make sure everything is in place, legal, and will take place just as you desire.
Find one in your local area that has a good reputation and who specialized in family law.
Lawyers who specialize in family law will be the most familiar with the laws involved in the estate and probate process.
Don’t Be Afraid: Plan For What Happens After Your Death
We know that this all seems morbid and can make people feel very uncomfortable. However, the last thing you want your family facing in a time of substantial grief is legal paperwork.
Avoiding probate is one of the greatest gifts you can leave your family when you die. The probate process, while seemingly simple, can sometimes last years. Depending on how organized your estate is, how many creditors you have, the number of accounts and investments you own, it can all be very confusing.
This can leave your family facing, not only the high funeral costs but a lot of attorney’s bills as well. If you are in a position to make it happen, set up a trust. If you don’t believe you require a trust and your estate is very simple the best thing to do is to write a will.
Make sure you pick someone responsible and level-headed to be your executor. Talk to them about it before you die. Tell them where you keep your important paperwork. Give them a breakdown of your bank accounts, investments, and anything else that can help them in probate following your passing.
Looking for some more articles about all things concerning family and family-related topics? Check out our family blogs here.
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