Life changes, so should your Will. The most common questions and answers of Estate Administration.
Updated: Apr 29
What is involved in estate administration? How long will it take? What happens if there is no will? Boz Law Offices help answer the questions that many people have surrounding estate administration...
Estate administration is the process by which an individual's lifetime financial affairs are wound up and their property and assets are distributed after they die. This process differs from state to state. The time it takes to administer the estate can vary based on whether the legal documents are in order, on the value and extent of the assets in the estate, and on the number of beneficiaries involved.
Let's Talk About the Future
Estate administration is the process of winding up a person's financial dealings after they die and then distributing that person's property to the people that inherit it. Say a close friend or relative has died. After the funeral and grieving process; what's the first step someone should take in estate administration?
The first steps to take in an estate administration really involves collecting information, particularly asset information, and finding out what the decedent owned and how it was titled; finding out if there was a will or not; obtaining death certificates, typically from the funeral director; notifying Social Security if the decedent was receiving benefits; and getting in touch with an attorney who could help walk you through the process.
What if someone dies without a will?
Well, a will is just a document that says you should receive your property upon your death and intestacy laws are basically a will that states make for you. So, they have a back up for you if there's no will in place. Usually, they'll start with your surviving spouse and children and then move on to more distant relatives afterward. An important point about wills is that not every piece of property somebody owns passes through it.
Let's talk about various sorts of property transfers and how they affect the state administration.
There are a number of types of property that would pass outside of the will and the probate process. That would be property that's titled as joint tenants with right of survivorship, life insurance policies and retirement plans, and other assets that have a beneficiary designation and pass according to forms you filed with a plan administrator, a life insurance company or bank, and also property that’s held in (for instance, a revocable trust for a living trust). Those would all pass outside of probate.
How do you probate assets get administered?
Everything that passing through a will uses the probate process, and basically, the estate appointing an executor or administrator the authority to manage and distribute the assets. The state oversees the process, so it ensures that everything's been done in a timely manner and the property is going to everybody and nothing is being misused.
Let's dive into some of the specific steps of probate.
The probate process can really vary greatly from state to state, so it’s important to get advice from an attorney who's admitted in the state where the decedent died, but generally, it will involve the petition to the court asking that there will be admitted and that somebody be appointed as the executor or personal representative of the estate.
It will involve notices to certain people; it will require the family tree to be fleshed out; it might include creditors' notices and then accounting and inventories that are filed with the court.
How are the decedent's debts handled?
As you mentioned, creditors often receive a notice, and it's required by a lot of the states’ probate codes. And once they're notified, they provide claims, and the executor then knows that there are debts that they should pay.
If the estate is insolvent and doesn't have enough money to pay all the debts, the probate code provides a priority list of who should be paid first and how to divide up the estate in that respect.
How long does this typically take?
How long the process takes is really going to vary by the complexity of the estate. A simple estate might get tied up fairly quickly while a larger estate, especially one that has an estate tax filing requirement, will take longer. The probate process itself will depend on the backlog of the court. For instance during the pandemic the courts were and still are very backed up because of it. Probates are taking a lot longer than it might otherwise take.
How are taxes involved in estate administration?
If you go back to the beginning, estate administration is winding up all of the decedent's financial dealings, and part of that includes filing their final income tax return. If the estate earns money while it's being administered, it's also going to have to pay an income tax, and that's done through the estate income tax return, fiducairy income tax return.
There are also federal and state estate taxes once the estate reaches a certain threshold, and then some states even have inheritance tax which is a tax based on who the money is going to.
Final thoughts before we end.
One final thought before we end, which is: that if you don't have a plan, you really do, it's the one that the state created for you, and it might not match what your wishes are. Many people think if they don't have a will in place that the property will all pass to their spouse, but that's not true in every state.
In New York, a spouse would only get about half if there's no will. It's also important, especially if you're an unmarried partner, even if your registered domestic partners, to have a will in place because you might not be recognized in the estate administration process as a beneficiary.
If you do have an estate plan, review it at least every five years. People come and go in our lives, things change, and it's important to make sure that it's up to date. If anyone has any further questions or wants more information, they should be sure to reach out to Boz Law Offices for further assistance.
We Can Help.
If you are the executor of an estate, the probate & estate administration attorneys at Boz Law Offices can help. Our probate & estate administration attorneys handle succession issues and can help you navigate court processes, payment of the deceased person's debts, distribution of property according to the will or estate plan, and probate litigation.
If you have any questions at all, we are here for you and have offices in Natick & Boston, Massachusetts. Call us for a no-obligation consultation regarding your rights and options.
Call (617)785-0010 or send us an email!
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