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The Probate Process

Probate is a court-supervised legal process for administering and distributing a person’s estate after their death. The process is governed by each state’s probate and estate laws.

Probate can be an expensive process (it varies by state – but estimates range from 2%-4% of the value of the estate). Probate can take from several months to a couple of years depending on the size and complexity of the estate. Needless to say, many estate planners prefer to avoid probate, if possible, by minimizing the value of the assets subject to probate (see below for the definition of probate assets).

If there is a will, the process is generally as follows:

  • A copy of the will is filed with the local probate court and a request is made for the court to approve the appointment of the executor for the estate.
  • The probate court will establish the validity of the will (e.g., self-proving will, witness testimony, etc.).
  • Heirs/interested parties/creditors are notified to give them opportunity to challenge the will, address the court, or make claims against the estate.
  • An inventory of the “probate assets and their values is prepared and filed with the court. Appraisals are obtained to support the valuations of the less liquid assets, if necessary.
  • The estate is administered (filing insurance claims and tax returns, liquidating financial accounts, selling assets, etc.).
  • Probate assets are distributed to the beneficiaries in accordance with the provisions of the will after all expenses, taxes, and approved creditor claims, etc., have been paid.
  • The estate is closed, meaning all of the directions in the will have been met.

“Probate Assets” generally include all the deceased’s property and assets except those which are passed to a named individual directly by way of law or contract. Probate assets generally do not include real estate or financial accounts that are titled as jointly with rights of survivorship, real estate with Payable on Death titles (only available in some states), and real estate with other jointly titled designations (e.g. Tenants by Entirety). Probate Assets also do not include insurance proceeds that are paid directly to a named beneficiary, as well as financial, retirement and other assets with named beneficiaries. However, assets without named beneficiares (inlcuding insurance or financial accounts) would be subject to probate.