What is Probate?
At death, your will goes through probate. Probate simply means the process by which your last will is determined to be your final dispositive statement and which confirms the appointment of the person or institution you have named to administer your estate. The term probate is also used in the larger sense of probating your estate. In this sense, probate means the process by which assets are gathered, applied to pay debts, taxes and expenses of administration, and distributed to those designated as beneficiaries in the will. The executor or personal representative named in the will is in charge of this process, and probate provides an orderly method for administration of the estate. The executor is held accountable by the beneficiaries (and sometimes is supervised formally by a probate court). The executor is entitled to a reasonable fee or commission. Probate law generally encourages or provides for partial distribution during the period of administration; assets may generally be distributed in kind rather than sold during this time. The tax laws generally focus the responsibility for death tax filings and payments on the executor under a will. Thus, the choice of an executor is an important one.
The basic job of administration and accounting for assets must be done whether the estate is handled by an executor in probate or probate is avoided. In the recent past, lawyers and other professionals have advocated the use of probate avoidance techniques (including revocable trusts) in states where the probate process was perceived as being too slow and too costly. Many states have simplified or streamlined their probate processes over the years. In such states there is now less reason to employ such probate avoidance techniques.
Should You Avoid Probate?
The living trust is often marketed as a vehicle that allows you to "avoid probate" upon your death. Probate is the court-supervised process of transferring property at death pursuant to the terms of a will. Many types of property routinely pass outside of the probate process. These include:
- life insurance or retirement plan proceeds which pass to a named beneficiary rather than your estate
- real estate or bank or brokerage accounts held in joint names with right of survivorship
While it is true that the property passing under the terms of a living trust upon the death of the maker of the trust will "avoid probate," it should be noted that there may or may not be actual value in that result. Probate laws are different in every state. In some states there are statutorily mandated court or attorney fees while in others those fees may be minimal, California for example has very high mandated court and attorney fees and has very long probate process, oftentimes more than 14 months.
For more information or to schedule an appointment with one of the Litchney Law Firm’s experienced Estate Planning attorneys please call us at 916-983-2941 or use the contact form on the website to schedule your free initial consultation!
What is Probate?
At death, your will goes through probate. Probate simply means the process by which your last will is determined to be your final dispositive statement and which confirms the appointment of the person or institution you have named to administer your estate. The term probate is also used in the larger sense of probating your estate. In this sense, probate means the process by which assets are gathered, applied to pay debts, taxes and expenses of administration, and distributed to those designated as beneficiaries in the will. The executor or personal representative named in the will is in charge of this process, and probate provides an orderly method for administration of the estate. The executor is held accountable by the beneficiaries (and sometimes is supervised formally by a probate court). The executor is entitled to a reasonable fee or commission. Probate law generally encourages or provides for partial distribution during the period of administration; assets may generally be distributed in kind rather than sold during this time. The tax laws generally focus the responsibility for death tax filings and payments on the executor under a will. Thus, the choice of an executor is an important one.
The basic job of administration and accounting for assets must be done whether the estate is handled by an executor in probate or probate is avoided. In the recent past, lawyers and other professionals have advocated the use of probate avoidance techniques (including revocable trusts) in states where the probate process was perceived as being too slow and too costly. Many states have simplified or streamlined their probate processes over the years. In such states there is now less reason to employ such probate avoidance techniques.
Should You Avoid Probate?
The living trust is often marketed as a vehicle that allows you to "avoid probate" upon your death. Probate is the court-supervised process of transferring property at death pursuant to the terms of a will. Many types of property routinely pass outside of the probate process. These include:
- life insurance or retirement plan proceeds which pass to a named beneficiary rather than your estate
- real estate or bank or brokerage accounts held in joint names with right of survivorship
While it is true that the property passing under the terms of a living trust upon the death of the maker of the trust will "avoid probate," it should be noted that there may or may not be actual value in that result. Probate laws are different in every state. In some states there are statutorily mandated court or attorney fees while in others those fees may be minimal, California for example has very high mandated court and attorney fees and has very long probate process, oftentimes more than 14 months.
For more information or to schedule an appointment with one of the Litchney Law Firm’s experienced Estate Planning attorneys please call us at 916-983-2941 or use the contact form on the website to schedule your free initial consultation!