Definition of Probate
The legal process through which a court makes sure that property is distributed to beneficiaries. The court’s concerns are to assure that valid creditors are paid and all assets are properly distributed in accordance with the individual’s will. Each state has different probate procedures. Depending on how the decedent’s estate is organized, probate is not always necessary.
The Probate Process
- At the time of a death, most states require that the person who possesses the original will must file it with the court of the county in which the decedent resided.
- After the will is filed, the personal representative (executor), heirs, creditors, or other interested persons may then petition the court to begin the probate process.
- Typically, the county court appoints a personal representative (executor) to settle the person’s estate based either on whom he or she nominated in the will or by statutory priority. The court then issues written documents giving the personal representative the authority to manage the estate, which consists of the right to:
- Find and gather the estate assets;
- Pay legitimate creditors;
- File and pay estate and income taxes;
- Distribute assets to the designated recipients.
- Once all of the valid debits are resolved, it is appropriate for the personal representative to distribute the remaining assets of the estate to the beneficiaries and inheritors. The personal representative will be expected to provide an accounting of how the estate assets were spent.
- Within nine months of the date of death, estate debts and federal estate taxes must be paid and beneficiaries or inheritors who wish to disclaim part of all of an interest in an estate must do so.
Cost of Probate
- Costs include fees to the court, attorneys, accountants, the personal representative, and other agents working to account for and distribute the estate’s assets, pay creditors and file taxes.
- Costs vary widely and depend on each state’s probate laws and rules.
- Costs are typically between 2-3% or more of the estate.