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3 Common Probate Questions: Estate Planning Basics
When people pass away, they leave behind assets, property, and possessions that can have sentimental and real value for surviving family members and loved ones. Everything that an individual owns upon their death is known as their estate.
According to Estate Exec, the average size of an estate is between $50,000 and $250,000. Eleven percent of estates are under $11,000, while 11 percent are over $1,000,000.
Some assets transfer directly to heirs after a person’s death. These non-probate assets include pay-on-death bank accounts, insurance policies with designated beneficiaries, trust funds, and jointly held assets with survivorship rights. Other assets must go through a process known as probate.
What Is Probate?
Probate is a legal process in which the court oversees the administration of the estate. The process involves validating the person’s will, satisfying their debts, and distributing their assets to beneficiaries. If there is no will, heirs under state intestacy laws receive the estate.
Assets subject to probate include property, bank accounts, investments, and personal belongings.
Typically, the estate representative initiates the process. If there is a will, the will should name an executor responsible for distributing the assets.
Yet many people die without a will. Per a study by Caring.com, only a third of Americans have an estate plan.
When an individual passes away without a will, an interested party may initiate probate. Spouses, adult children, other relatives, and creditors may petition the court to open the estate.
Should the estate representative fail to open probate on time, an interested party may petition the court.
For those who have not encountered estate administration in the past, the process can be an unfamiliar concept. Here are answers to three commonly asked questions about the probate process:
1. How Long Do You Have to File Probate After Death?
How long the estate representative or interested party has to open probate depends on the jurisdiction. Each state has its specific laws and regulations about the timeframe for initiating the process.
Some jurisdictions do not set a strict deadline. For instance, New York has no time limit or statute of limitations on probating a will.
Other jurisdictions have statutory time limits in place. California, for instance, allows individuals to open probate up to one year following a death.
Since probate can take months to years, it is best to initiate the process as soon as possible after the person’s death.
2. How Long Do You Have to Transfer Property After Death?
After a property owner’s death, the ownership of the property must transfer to another party.
In certain circumstances, a person’s house may not have to go through probate. If the property is owned as joint tenants or tenants by the entirety, the surviving owner retains ownership. Transfer on death deeds or transfer on death instruments and living trusts also allow individuals to pass property directly to beneficiaries outside of probate.
Property owned individually or as tenants in common becomes subject to probate. When the property is subject to probate, how long you have to transfer it depends on the rules and regulations of your jurisdiction. Once the property becomes part of the probate estate, the court determines who receives the property based on a valid will or state intestacy laws. The court may require the sale of the property to satisfy debts or distribute money to beneficiaries.
The new property owner must obtain a new deed for the home from the county recorder’s office. When the property transfers outside of probate, it can be faster than when the property goes through probate. Receiving a new deed from the county recorder’s office can take between two weeks and 90 days. Depending on the complexity of the estate, the probate process can take several months to two years.
3. What Is a Petition for Discharge in the Probate Process?
A petition for discharge is an essential step in the probate process that allows beneficiaries and heirs to obtain assets from the person who has passed away. The personal representative files the petition to request the court’s approval to distribute the assets and close the estate.
The petition specifies how the beneficiaries will receive the assets. It also discloses how much money the personal representative receives for services rendered and the attorney’s payment.
After the court approves the request, the executor can distribute the assets to the beneficiaries.
Consult With an Attorney
Handling the administration of an estate after a loved one’s passing can be challenging. Please feel free to reach out to Sowards Law Firm with questions or concerns at (408) 371-6000 or info@SowardsLawFirm.com.