Many beneficiaries who recently experience a loved one’s passing don’t realize the hoops they may have to jump through after their death. If you’ve never been a beneficiary to an estate you might not know what probate is.
Estate attorneys recommended their clients avoid probate as much as possible. In addition to prolonging the grieving process by carrying on the estate process for months and even years, probate can actually take up to 5 percent of an estate’s value. Avoiding probating a will can save families money and ensures that the estate goes to all the correct heirs. Follow these estate attorney-recommended tips on how to avoid probating a will or trust. In this article you’ll find information on:
- What is probate
- Why you should avoid it
- The probating process
- Fees associated with probating a will
- How to avoid probating a will
What Is Probate
Probate proves an estate’s last will and testament. Probating a will means that all the assets in the estate are distributed to the correct heirs and all the final wishes of the deceased are kepts. It legally verifies the will of the deceased and ensures their final intentions are made. However, if the deceased does not have a will, the beneficiaries must go to probate court to decide how the assets and estate is distributed.
Some smaller estates can be handled in a matter of weeks, but larger estates can take years. This is especially problematic as the longer the will remains in the hands of the court, the more opportunity others have to claim parts of the estate. Anyone with a valid claim to the estate can contest the will or file a petition with the court if they feel entitled to part of the estate. It’s vital to avoid probate to ensure that not just anyone can take advantage of a loved one’s estate.
Bank accounts, retirement funds, and life insurance policies with a payable-on-death beneficiary don’t normally go through probate. These are all transferred to the beneficiary immediately upon death. Despite popular belief, both wills and trusts can also go through probate.
If the will is proved, then the executor, or representative of the will, will manage and distribute the assets accordingly. All fees associated with the estate or the probating process will be paid out of the estate. Because of this, the probate process can actually diminish the value of the will significantly regardless of size.
Why Should You Avoid Probate
As mentioned, the probating process can become lengthy, especially if the deceased does not have a will or trust, or the estate is significantly large. The longer the probating process goes on, the more issues families tend to have.
More Valid Claims to Assets
The more time the will and estate go through the probating process, the more opportunity others have to try and claim it. Anyone with a valid claim to the estate can contest the will during this time by writing a petition to the court.
Sometimes this is because the deceased never made a proper will and may have left important loved ones out. However, depending on the situation, the deceased may have purposefully kept this person out of the will. This can anger and upset many who feel entitled to some or all the deceased’s estate, which can affect the estate if a lengthy court battle ensues.
Increased Legal Fees
If probating the will continues for a lengthy period of time, it can cost familys thousands of dollars. All fees associated with the will and estate are taken directly out of the estate. This is why most estates that go through probate end up losing a small portion of it’s value.
How To Probate a Will
Determining if the will is the true intentions of the deceased requires witnesses or “self-proving affidavits” to sign an affidavit along with the decedent. During this time a judge will also name an executor, who must:
- Get the death certificate
- Present certificate and will to judge
- Identify and appraise assets
- Pay liabilities, debts, and taxes
- Notify beneficiaries
- Distribute assets
Most states have laws that require all the deceased possessions be filed with the probate court, even if they’re already distributed to someone else. During this time, an application or petition to probate the will through court.
As the will goes through probate, others have the opportunity to contest the will if it’s not properly drafted or needs to be updated.
Fees Associated With Probating a Will
All fees to do with probating the will will be taken out of the estate. Altogether, beneficiaries should expect to see 3 to 7 percent of the estate to go to these fees. Along with the fees from your estate attorney, you should expect to pay for the following fees during the probate process.
Commonly, the executor waives the fee, especially in the case of it being a close family member or they’ve already inherited the majority of the estate.
Estate Attorney Fees
Depending on the state you live in, a court will justify what probate fees are reasonable. Other states may base this fee off a percentage of estate. Every estate attorney charges their clients differently. They may have a flat fee depending on the scope of their work or charge hourly if the probate is extensive.
Depending on your state, your estate attorneys cannot collect fees until after the probate has ended. Some states will allow estate attorneys to take either a percentage of the estate or to charge an hourly fee.
To get a quote on what you should expect to pay your estate attorney during the probating process, call one of the partnered attorneys with My Case Helper to get a quote and a free legal advice. When you visit your estate attorney, be sure to ask them for the estimated amount on:
- Estate attorney fees
- Court filing fees
- Probate bond
- Creditor notice fees
- Whether or not you should take executor fees if you’re the executor
Court Filing Fees
Every state has different filing amounts and fees, some even include administrative fees in this process. If your estate is valued below a certain amount (this can, again, change depending on where you live) the executor will need to file probate with your county clerk. Unless your estate is valued below a certain amount, your executor will need to file probate with the county clerk. Your estate attorney should be able to let you know what standards you should expect in your state.
Probate bonds are also referred to as fiduciary bonds or estate bonds. These bonds will insure the value of your estate. Similarly with insurance, this fee helps secure the assets and estate in case of an emergency where all assets are lost. Many states require the executor to have a probate bond unless the will explicitly states otherwise.
Creditor notice fees
Your state may also require the executor to announce the death publicly to all creditors of the deceased. If the executor decides to post about the deceased in the local paper or another publication, it may cost money.
How To Avoid Probating a Will
As you can see, probating a will can be a lengthy process that could take up the majority of the assets in the estate. It’s best to avoid it, especially if the estate is smaller, or can be threatened by the wrong person who feels entitled to the estate.
There are several ways families can avoid lengthy probate court. However, the best way to avoid any unprecedented events upon a loved one’s death is to legally prepare for it. Planning an estate with an estate attorney will ensure that the will and final wishes of your family are kept. Continually updating the will as each year passes ensures that all parties involved have proper legal say in the proceedings.
Revocable Living Trust
A revocable trust ensures the trust property is not a part of the estate. It is counted as a part of the estate for tax purposes, but any valuable property is held in the trust until after the owner’s death. It also allows for the owner to change the circumstances or conditions of the estate more easily as the years go on.
Having the ability to change the trust while the owner is still living ensures that anyone who feels entitled, has valid claims, or has lost privileges understands the terms and conditions before you go to probate court.
Pay-on-Death Accounts and Registrations
Bank accounts and retirement accounts can be converted to payable-on-death accounts. All the owner of the will has to do is file a form with the list of beneficiaries. When the owner passes, the assets go directly to the beneficiaries without probate court.
Security and vehicle registrations can also be allocated like this in some states. A few states will also allow a transfer-on-death deed, which transfers any property with a deed when the owner dies.
Joint ownership provides an easier way to probate a will after the first party dies. The ownership title goes to the other living party, as stated in the joint ownership agreement. There are a few ways to have joint ownership of a will:
- Joint tenancy with right of survivorship: Any joint-owned property is automatically released without probate to the survivor(s) when one owner dies.
- Tenancy by the entirety: Some states allow married couples to take tenancy by entirety. This is similar to joint tenancy, but can only be used by legally married couples. This option still allows owners to avoid probate.
- Community property with right of survivorship: Any community property owned by both parties automatically goes to the surviving spouse without probate. This can only be done in some states and requires the couple to be legally married unless they live in California.
Finding the right estate lawyer can be tricky. You want an estate attorney who’s not only qualified, but wants to help you keep all your assets. My Case Helper works with partners across the country to ensure that all your assets are cared for and handled properly.
To get free legal advice or to talk to an estate attorney today, call the number at the top of your screen