Probate and Trust Administration

As part of our elder law practice, we handle probate matters and trust administration for our clients. A probate action through the court after a person passes away includes the filing of a petition, publishing notice to creditors, inventory and appraisal of the estate, payment of debts, claims and taxes, and final distribution and closing of the estate.

Trust administration assistance is also available through our firm in the event that the initial trustee named in the trust becomes incapacitated and the successor trustee needs to take over, to ensure proper notice is given in accordance with the law to beneficiaries, that trust accountings are done, taxes are minimized, creditors are paid and the assets are properly distributed according to the terms of the trust. This kind of administration is triggered if the Settlor and/or trustee becomes incapacitated or when the Settlor passes away.

What is Probate?

Probate is a court procedure which is started by the person named as personal representative in the Will, or if there is no Will, an interested party, who files a pleading with the court asking for a probate to be initiated through the court system. The court will then name a person to become personal representative of the estate in accordance with the Will or as otherwise appointed by the court, to retitle the assets into the name of the estate, pay off creditors in an orderly manner, file the necessary tax returns, do a final accounting to the beneficiaries and to distribute the assets to the beneficiaries. Sometimes this procedure can be done informally without a hearing through the Probate Registrar (a type of court clerk) just by filing the required paperwork with the court, or it can be initiated by a formal proceeding which goes before a judge. A formal proceeding becomes necessary in some cases in the event of irregularities in the documents or if the matter is contested.

What are the Advantages of Probate?

One advantage of probate is that when a notice to creditors is published, all debts and liabilities of the decedent are terminated with respect to creditors who fail to file a claim against the estate within a four month period. Another advantage of probate is that the probate court can resolve any disputes involving the decedent’s estate and disposition of the estate assets.

What the Disadvantages of Probate?

A probate proceeding is a public record. Anyone can examine the probate court’s file, including the inventory of the probate assets. Probate also takes time, typically six months or more. Probate can also be expensive. Attorney’s fees and costs are usually several thousand dollars.

What Property Avoids Probate?

Whether assets will be subject to probate depends on several factors. The following types of property are not included in a decedent’s probate estate and therefore do not have to be administered through a court probate process:

  • Property that is held in trust.
  • Property owned as joint tenants with right of survivorship or community property with right of survivorship.
  • Real Property subject to a “beneficiary deed.”
  • Property that is held by a third party that passes to one or more designated beneficiaries by virtue of a contact such as life insurance proceeds, retirement plan assets subject to a valid beneficiary designation and financial institutions “pay on death” accounts.

If the estate is small, is it still subject to probate?

Even if the assets are subject to probate, a probate is not required if the total value of all the personal property (anything but land) in the estate is under $75,000, and the total value of all the real property (land), based on the property tax assessed value minus the amount of any mortgage and/or liens, is less than $100,000. In such cases, legal affidavit forms can be used to “collect” the assets.