When Do You Have to Go Through Probate?
Some people who work with an attorney to develop an estate plan do so to avoid their estate going through the formal probate process. Others are not particularly concerned about probate, or they view the legal process as helpful for ensuring the fair distribution of assets.
When the decedent has a will, the probate process does two things: it establishes that a will is valid, and it provides a process for closing the decedent's estate by paying bills and distributing assets to named heirs.
When the decedent does not leave a will, the probate process determines who will be the heirs and supervises the closing of the estate.
This article discusses the situations under which an estate must go through the probate process.
When There's A Will
If there is a last will and testament, it needs to be filed with the probate court. Whether that initiates a probate proceeding is another matter that depends upon the size of the estate at death, state laws, and whether someone is willing to act as executor of the estate.
Generally, after a last will and testament is filed, the probate process begins in order to:
- Distribute assets
- Pay valid debts
- Transfer relevant assets
- Clear up any contest of the will
Each of these topics is explained more in-depth below.
Probate gathers, values, and distributes property and also initiates the legal transfer of title to that property. If a deceased person owns real estate, a probate proceeding is required to transfer the property out of the decedent's name to the surviving owner (if owned as a "tenant in common") or to heirs.
Paying Valid Debts
The executor or heirs of an estate may question the validity of bills submitted for payment by the estate. The creditor may have submitted a request for payment after the due date. The creditor may not have any documentation to support their claim that money is owed. If a creditor claim is challenged, that case is heard in probate court.
Transfer of Assets
Probate is frequently required to determine the value of the property held in the deceased owner's name. The executor or personal representative will assess the value of the estate assets and distribute the assets to creditors and then to heirs.
Death can cause old family tensions to resurface. Disputes can arise when family members or anticipated heirs are unhappy with the deceased's last will and testament. A beneficiary or expected beneficiary may challenge the will in probate court.
Reasons that a will may be contested include:
- Lack of competency when the deceased drafted the will
- Fraud, undue influence, or coercion
- Problems with the will – lack of witnesses, lack of notary, under which state law the will should be probated, etc.
When There Is No Will
When a person dies without a will, they are said to have died “intestate." The probate laws of the state where they lived and considered their permanent residence will determine how their property is distributed upon death.
Estate administration when there is no will is similar to when there is a will. A personal representative will be appointed by the probate court judge to complete the probate process but with the additional step of determining the heirs.
Determining the Estate's Heirs
If no Will exists, the property is divided among the person's heirs. In California, if the person has a spouse and or children, the property first goes to them. If there is no spouse or children, the property goes to the person's next nearest relatives. The laws of intestate succession are state-specific.
It's not uncommon for property transferred under intestacy to be counter to what the deceased would have chosen if living. Probate transfers title to the heirs with the closest family relationship to the deceased.
In many states estates falling below a predetermined value avoid the traditional probate process. In California, estates valued under $150,000 qualify as small estates and can go through a simplified, expedited probate process. In Oklahoma, estates valued under $20,000 are considered small estates and do not have to go through probate.
The small estate exemption applies whether or not there is a will. Personal property is transferred with the use of affidavits.
Situations When You Can Avoid Probate Court
When you die, your assets are classified as either probate assets or non-probate assets. If you want your estate to avoid probate so your loved ones and surviving spouse can receive their inheritance quickly, there are estate planning tools you can use to make more of your property non-probate property.
- Joint tenants of real estate with the deed showing “joint tenancy with rights of survivorship"
- In community property states, some or most property transfers to the surviving spouse
- Transfer on death deeds for homes or real property like vehicles
- Designated beneficiaries on bank accounts, retirement accounts (401ks and IRA accounts), and life insurance policies which are then payable on death (POD) or transfer on death (TOD)
- Irrevocable trusts and revocable living trusts
Have Probate Questions? Ask a Probate Attorney
Whether you're working on your estate plan or closing out the affairs of a loved one, legal advice from an experienced local estate planning attorney or probate lawyer can help you through the process.
Can I Solve This on My Own or Do I Need an Attorney?
- Complex probate situations usually require a lawyer
- A lawyer will take these matters seriously and enforce protections
- Get tailored advice and ask your legal questions
- Many attorneys offer free consultations