It's not fun to think about by any stretch of the imagination—but when you pass away, many decisions will need to be made regarding your assets, property, and more. Rather than leaving your loved ones to figure things out, having a detailed estate plan can help outline your wishes so they can be legally carried out as easily as possible.
Unfortunately, when a person passes away without an estate plan, with a will, or when there are disputes regarding the documents within the estate plan, it may be necessary for your loved ones to go through the probate court in order to get things sorted out.
Probate Court Definition
Specifically, probate refers to the process by which a court oversees and sometimes makes decisions regarding how a deceased person's property and assets are distributed.
In these situations, a probate court itself appoints a person to take over control of the person's assets, make sure any remaining debts are paid off, and distribute property/assets to beneficiaries accordingly. The person appointed to oversee the estate is called the administrator or executor, and is usually named in the will if there is one, or is a close relative or friend of the deceased.
The legal probate process remains relatively consistent from one state to the next, though different states may have different names for their probate courts. They are often referred to as Orphan's Court or Chancery Court.
Probate court required when the deceased dies owning any assets that don’t transfer automatically so the assets can legally be passed on to heirs. However, the probate process may also be used when there is a question over the authenticity of an estate-planning document or the mental stability of the person who created it.
The Purpose of Probate Court
It's easy enough to define probate, but understanding the purpose of the probate court is just as important. Probate courts are generally in place for a few main reasons. The main purpose is to ensure that any financial liabilities left behind by a person who has passed away are taken care of.
Creditors are given notice of the death, and have a set timeframe in which they can make a claim against the estate. For example, if you pass away and still owe money on credit cards, the probate process will be used to pay off your outstanding debt before any of your inheritance can be passed onto your heirs.
In addition to making sure outstanding debts are taken care of, the probate court is charged with the responsibility of dealing with a deceased person's remaining assets and their distribution. If a will is in place, this process is typically a lot easier because the wishes of the deceased are very carefully outlined.
Unfortunately, situations where there is no will or detailed estate plan in place, can complicate the process and draw things out significantly.
Understanding the Probate Court Process
In most cases, the probate court process must be initiated by a petition. In a situation where the deceased person has a will, the person named in the will as executor or administrator contacts the probate court and files the petition themselves, or hires an attorney to do so. From there, the courts will take a look at the will as a document to ensure it is valid. Specifically, they'll be looking for signs that the will may not have been written by the deceased person or that the person who created it was not in the right mental state at the time of its creation. The court will also make sure the proper formalities were followed: the will has the right number of witnesses, is notarized, dated, and signed by the decedent.
In most cases, the will is recognized without issue, although it is possible for a court to declare the will invalid if the proper formalities were not followed. From there, the probate court will usually appoint an executor or administrator to ensure that the wishes outlined in the will are carried out in a timely manner.
Unfortunately, the probate process can get a little more complicated and time consuming in situations where there is not a will in place. Each state has laws that dictate who receives the assets of the estate and in what proportions depending on the relationship to the deceased. Unfortunately, this may create tension and conflict among family members and the process can then get increasingly complicated. Relationships may be strained as a result.
It is also important to understand that there are fees and other costs that come along with going through the probate process—and the more complicated it becomes, the more costly it may be as well. In addition to court filing fees, it may become necessary to hire a probate attorney—who may charge by the hour or a flat fee. A few states also allow an attorney to charge a percentage of the total estate value. The executor or administrator is also allowed to charge a reasonable rate for their time spent administering the estate.
There are many factors that can impact how long the probate process lasts (and thus how much it costs), including whether or not a will was in place, the types of assets in the estate, and whether or not any family members contest any of the outcomes. If the deceased died with any debts, the estate must remain open for a set time period to allow creditors time to file a claim against the estate. Depending on the state, this creditor period can last anywhere from 30 days to 2 years after the creditor is notified of the death.
As part of the probate court process, you should also be aware that your finances will become a matter of public record whether you have a will or not. This means that after the probate process is completed, anybody will be able to find out about your assets and debts, as well as who you choose as your beneficiaries for assets and property. For this reason, some people choose to implement a trust in addition to a will, since trusts can typically be carried out without probate and are not a matter of public record.
The Probate Process and Taxes
Another thing to be aware of when it comes to the probate process is that taxes may apply to your loved ones' inheritances. The specifics here can vary widely from one state to the next, but most states will require that some form of tax be paid at the time of inheritance. This means that the amount your loved ones will inherit will be decreased by the amount of the tax. Even if your assets do not pass through the probate process, assets passed by trust may also be subject to the estate tax.
Depending on the value of the estate or assets you're passing on, it is also possible that your beneficiaries will be required to pay the Federal Estate Tax. This Federal tax is assessed to those with an estate exceeding a value of around $11.5 million (changing to about $6 million in 2026), though there are exemptions. With proper planning and consultation with an attorney, you may be able to reduce the value of your estate and avoid estate taxes.
The Importance of Having an Estate Plan
Now that you have a better understanding of the probate process and what it entails, hopefully it's clear that having an estate plan in place is important. In some cases, having a detailed estate plan that includes a trust can even negate the need for your loved ones to go through the probate process at all after your passing. This can help them avoid a lot of the stress and hassle that can come along with making court appearances, as well as the costs associated with the probate process.
Having an estate plan also helps to reduce the likelihood of family disputes following your passing. By carefully outlining who will receive what (and letting beneficiaries know what to expect ahead of time), you can do your part to keep the peace after you pass.
Even if you don't set up a trust, you can help to streamline the probate process by having a carefully detailed will. This will make it easier for the probate court to ensure the validity of your will and carry out your wishes in a timely manner, thus reducing the amount of time your loved ones need to spend in probate court and saving them money as well.
Avoiding the Probate Process
The best way to avoid the probate process is to create a trust during your lifetime as part of your estate plan, since these legally binding documents usually do not require probate and are also not a matter of public record. Also make sure you name beneficiaries on any life insurance policies, transfer on death accounts, IRAs, and other assets that allow you to name a beneficiary. Of course, there are situations where a will will be a more logical choice than a trust, so avoiding the probate process will not always be possible.
No matter what, having a detailed estate plan is the best way to ensure that the probate process goes as smoothly and seamlessly for your loved ones as possible. Consult with a local estate attorney to begin drafting yours.
A platform like Cake can help make the process easier than ever. This end-of-life planning platform makes it easy for adults of all ages to be proactive about their planning. Here, you can create or upload documents, like your completed will and/or trust, and then share 24/7 access with loved ones. This can help them get a better idea of where they stand when you pass and will help expedite the probate process if it becomes necessary. Best of all, Cake is free! Create your free Cake account to start planning.
Disclaimer: The information posted on this site is provided solely for informational and educational purposes and is not legal advice or tax advice. Contact an appropriate professional licensed in your jurisdiction for advice specific to your legal or tax situation.
- Bell, Kay. "Estate and Gift Tax Exemption." Bankrate. January 10, 2017. www.bankrate.com/finance/taxes/estate-tax-and-gift-tax-amounts.aspx
- Garber, Julie. "What Happens During the Probate Process?" The Balance. December 5, 2018. www.thebalance.com/what-is-probate-3505244
- Randolph, Mary. "How to Determine if a Will is Valid." AllLaw. www.alllaw.com/articles/nolo/wills-trusts/how-determine-will-valid.html