What is Probate?: Definition, Process, Challenges, and Strategies for Avoidance

Probate is the legal process through which a deceased’s estate is administered and settled. It involves validation of a will, appointing an executor, inventorying and valuing assets, paying off estate debts and taxes, distributing assets, resolving disputes and closing the estate. 

What Does Probate Mean?

Probate is the legal process through which the estate of the decedent is distributed, the debts paid, and the wishes of the deceased honoured. The executor named in the will files a petition, collects the assets, makes an inventory, pays debts and distributes assets to beneficiaries. 

What Does it Mean to Probate a Will?

To probate a will means to file a petition in the probate court accompanied by a will with the aim of validating it. Validating a will is the process of ensuring that the will is executed correctly, the testator was of sound mind at the time of signing, and there are no legal challenges as to the will’s authenticity. 

How Does Probate Work?

When a person dies, their estate goes through the probate process, whether or not they had a will. In instances where the decedent dies intestate, a petition is filed in court together with a will or a list of the beneficiary’s assets, liabilities, and beneficiary estate. 

When a decedent dies, their assets are reviewed by the probate court, which provides a final decision on the distribution of the assets amongst the beneficiaries. The executor is obligated to follow the probate process as outlined by the court. 

What is the Purpose of Probate?

The purpose of the probate is to:

1. Validate the will to ensure it is legitimate and legally binding. Validating a will consists of the court reviewing the will to ensure it is appropriately executed, free from undue influence and fraud.
2. They were appointing an executor or a personal representative in instances where the decedent failed to nominate their executor under the will.
3. Settlement of debts and taxes owed by the decedent’s estate.
4. Orderly distribution of the assets of the assets of the decedent as outlined in the will or as ordered by the probate court in instances of intestacy.  
5. Resolving any disputes that may arise that challenge the validity of the will, and the distribution of assets, among other challenges. 

Why Do You Need Probate?

The major reason why you need probate for a person who dies with a will is for the will to be validated, the property of the deceased to be divided as provided in the will, the debts of the estate to be paid, and other bequests to be dealt with as provided for in the will. 

What Happens During the Probate Process?

During the probate process, the following occurs:

1. File a petition accompanied by the will to validate the will.
2. Appointment of an executor or personal property where the decedent died without a will or where the will does not appoint an executor.
3. Notifying all the interested persons, such as beneficiaries, debtors and creditors.
4. Paying off debts and filing the decedent’s final taxes.
5. Distribution of the assets of the decedent as provided for in the will or as ordered by the probate court in cases of intestacy.

Probate With a Will

The probate process with a will involves filing a will together with a petition in the probate court. The court reviews and validates the will that is filed, and the court authorises the executor appointed under the will to manage the decedent’s estate and administer the estate as provided under the will. The executor is obligated to notify all the interested parties, including but not limited to beneficiaries and creditors, pay off debts and taxes, distribute assets, and close the estate.

Probate Without a Will

When one does without a will, they are considered to have died intestate. When one dies without a will, a petition is filed with the probate court to institute the process, the court appoints an administrator to manage the estate; the administrator appointed is responsible for identifying and inventorying the assets of the decedent, notifying all beneficiaries and creditors, and distributing the assets of the decedent according to the court orders.

Is Probate Always Required?

No, probate is not always required unless the decedent dies, leaving behind a will or if they die without leaving a will and without making any other alternative plans such as creating a trust, gifting your assets to your loved ones, payable on death assets, among others.  When you make alternative plans, probate shall not be required. 

What is the Disadvantage of Probate?

In as much as the probate process helps in the administration and distribution of the assets of the decedent, it can be disadvantageous. For example:

1. The probate process may be lengthy. 
2. The probate process may be complicated for persons who have yet to become acquainted with the court process.
3. The probate process may be costly. 
4. The probate process may lead to potential disputes between beneficiaries and family members.
5. Probate proceedings are public, meaning details of the estate, including debts and assets, become part of the public record. 

Why Do Some Dislike the Probate Process?

Some people dislike the probate process because, in addition to the emotional turmoil and anguish that comes with the death of their loved one, they have to go through the probate process that can be expensive and lengthy. Some people dislike the probate process because:

1. It is conducted publicly, exposing the affairs of the decedent to the public.
2. The process can be costly and may include appraisal fees, court costs, attorney fees, and executor fees. 
3. The process can be lengthy, lasting up to one year.

How to Avoid Probate

You can avoid probate by:

1. Creating a trust

A trust facilitates the transfer of money and assets during the lifetime of the owner of the property to a trustee who will manage the assets on behalf of the beneficiaries. Property that has been transferred under a trust does not form part of the estate of the decedent.

2. Joint Ownership

Property that is owned jointly, such as an apartment registered in the name of a couple as joint owners, does not go through the probate process. When one of the persons who co-owns property dies, the property will automatically belong to the surviving co-owner. 

3. Pay-on-Death Accounts

Some financial accounts may contain pay-on-death clauses that specify the beneficiary of the financial account who will automatically benefit upon the death of the owner of the account. 

4. Gifts

Passing on your assets as gifts during your lifetime can help avoid probate. For example, if you have five cars, you can give your wife two cars, your daughter two cars, and your son one car. For a gift to be considered valid, it must be permanently transferred to a beneficiary, and the possession and ownership of the gift must be transferred to the beneficiary.

5. Applying for a simplified procedure for simple estates

Simple estates with fewer assets and no disputes can adopt simple procedures for simple estates. The estates that qualify for simplified procedures may vary from state to state; most states have requirements on the value of the estate that can apply for simplified procedures. 

How can Estate Guidance Help you Avoid Probate?

Estate guidance from an estate planning attorney can help you avoid probate by guiding you on the best tools to adopt to avoid probate. The tools an estate planning attorney may recommend include creating a trust, owning property jointly, giving gifts, living wills, and advanced directives, and establishing a family limited partnership. 

Estate guidance helps identify less costly tools that do not cause inordinate delay in administering the decedent’s estate.  

When is Probate Required?

Probate is required when:

1. Firstly, the decedent died, leaving a valid will that details how the affairs of their estate, such as assets, debts, children, and beneficiaries, will be dealt with.
2. Secondly, probate is required when the decedent dies without leaving a will. The probate process is necessary for the appointment of an executor or a personal representative and for ordering the distribution of the assets. 

When is Probate Not Necessary?

The probate process may be unnecessary when:

1.  The value of the assets is low.
2. The decedent jointly owned assets with the person who is alive (survivorship doctrine applies).
3. The decedent created a living trust.
4.  Assets include a payable-on-death (POD) provision.
5. Life insurance policies with valid beneficiaries.
6. Retirement accounts with a designated valid beneficiary.
7. Community property.
8. Household gifts.
9. Any assets passed through contractual agreements, meaning business but out agreements, shareholder agreements, and business succession plans. 

However, probate is necessary when the decedent leaves behind a valid will or dies without one.

How Long Does Probate Take?

A probate process takes, on average, six to eighteen months. However, for estates with disputes, the process might take longer. If a will is a public record, the probate process may take less time.

How Long Does Probate Take Without Will?

A probate without a will takes up to two years. Factors that determine the length of the probate process include the size of the estate, conflicts among beneficiaries and family members, difficulty locating property, and mismanagement and intermeddling with the deceased’s estate. 

What Are the Costs Involved During the Probate?

The probate costs range from $500 to $10000. Probate costs vary depending on the complexity of the estate, the size of the estate, the attorney fees and the duration of the probate process. The costs involved during probate include: 

1. Estate attorney fees

These vary depending on the attorney fees. Different attorneys charge different amounts of fees depending on their billing policy, their expertise, their location, and the time spent preparing legal documents. 

2. Court Fees

These include court filing fees, which may range from $50 to $1000, the cost of certified copies of court documents, and publication fees for legal notices.

3. Executor/Administrator Fees

These are fees paid to the person responsible for managing the probate process.

4. Appraisal fees

This fee is paid to the person determining the value of the estate of the decedent. They choose the value of the property and assets of the decedent’s estate. 

5. Miscellaneous Fees

In addition to the previously mentioned fees, the estate may be required to cover additional costs, such as storage and accounting fees. The question of “how much does probate cost” depends on several factors, including these miscellaneous fees. 

What is Probate Court?

Probate court means a specialised court that handles matters that relate to the administration of the estate of the deceased. The probate court validates wills, appoints personal representatives in instances where the decedent did not appoint an executor under the will, it supervises the administration process ensuring that the personal representative and/or executor follows legal procedures, handles disputes that may arise during the probate process and protects the interests of minors and other incapacitated persons.The probate court meaning may vary as other states do not have specialized courts that deal with probate matters, the probate matters are dealt with at the district courts. 

How Much Does an Estate Have to Be Worth to go to Probate?

There is no specified amount that an estate has to be worth for it to go through probate. All estates must go through probate. However, the probate process may vary depending on whether the decedent left a will, the size of the estate, its complexity, and the state where the decedent resided prior to his death. 

Who is the Right Person to Handle Probate Matters?

The right person to handle probate matters is the executor who was appointed under a will or a personal representative appointed in probate court. The executor may be a natural person or an institution such as a trust company or a bank. 

The executor is in charge of initiating the probate process by filing a petition, making an inventory of the deceased’s assets, managing the assets of the decedent, paying debts off debts of the deceased’s estate, filing the deceased’s final estate tax returns, and distributing the deceased’s assets. 

How Does the Person Handling Probate Matters Figure Out What Process to Use?

State laws on the making of wills and intestacy determine the process to use. Additionally, the process varies depending on whether the person died with a will or without making a will. The probate process for a person who left a will differs from that for a person who died without leaving a will. The state laws dictate what documents to file, the timelines for filing, and the procedures to be followed during the probate process. 

Does Probate Mean More Taxes?

Probate does not necessarily mean more taxes. The amount of taxes to be paid depends on the value of the estate, the state where one resides, and where the property is situated. Some states impose estate tax, inheritance tax and federal tax during the probate process. The estate tax is levied on the value of the decedent’s assets after debts have been paid. States like Washington, New York, Vermont and Rhode Island impose estate taxes. 

Inheritance tax is a tax imposed on the assets or estate of a deceased person before they are passed on to their heirs. Federal estate may be applicable in estates whose value exceeds 13.61 million. The maximum federal estate tax rate is 40% on the value of an estate above that amount.

How Does Oregon Probate Law Without Will Work? 

In Oregon, when one dies without a will, the intestacy laws provide for the procedure for filing the probate and the documents required in the probate process.  The intestacy laws dictate that family members, as joint administrators file for probate proceedings in the probate court in the county where the decedent resided prior to their death.  To avoid intestacy laws, you can make an online will in Oregon.