What is probate?
A quick primer on an important process.
After you die, sometimes it becomes necessary for a court to oversee the distribution of your assets. That’s where probate comes in. Probate is a process for determining heirs, paying creditors, and distributing assets. You can’t avoid probate with a will. Any contractual asset (bound by contract) payable to the estate of the owner must go through probate court. It also only applies to individual or jointly-owned property.
Probate laws differ by state as to the amount of assets an estate must have to be subject to probate. States often have simplified rules for what are defined as “small estates.” For an estate going through a regular probate process, typically after a death, the estate executor will file the will with the court, who will determine its validity. If you die without a will, a personal representative will file a petition with the court. Then the court appoints an administrator, usually the nearest relative. Notice of probate proceedings are published in the local newspaper to alert anyone with claims against the estate to file them, usually within five months.
Did you know...?
The Uniform Probate Code, established in 1969 and adopted by 18 states, specifies the rights of a surviving spouse when their spouse dies without a will or trust. Their rights include:
- If an individual does not make a will, any property owned during their life will pass by intestate succession to the heirs. A statute designates who are heirs, and the line of succession has always included spouse, children, parents, and blood relations in some order of priority.
- The spouse takes 100% of the estate unless one of the following apply: (1) the spouse of a childless decedent who leaves no will takes the first $200,000 plus three-fourths of the balance of the estate if there is a living parent of the decedent; (2) if the decedent’s children are also children of the surviving spouse and the spouse also has a child of a prior marriage, the spouse takes the first $150,000 plus one-half of the balance of the estate and the decedent’s children share the balance; (3) if the decedent left a child by a prior marriage, the spouse takes the first $100,000 plus one-half of the balance and the decedent’s children take the rest.
- The system also recognizes the fact of second marriages in which there may be other familial obligations with a better claim upon the deceased spouse’s property until the marriage has sufficient longevity to merit a full 50% share for the surviving spouse.
This material has been gathered from sources believed to be reliable and is provided for informational purposes only. Neither New York Life nor its agents provide tax, legal or accounting advice. Please consult your own tax, legal or accounting professional before making any decisions.
For a more in-depth account of the probate system works, you can start here.
Source: Uniform Probate Code Article II - Intestacy, Wills, and Donative Transfers: http://www.nccusl.org/nccusl/uniformact_summaries/uniformacts-s-upca2iwadt.asp