It’s common knowledge in the estate planning field that people like to avoid the probate process. Many people hold this general idea, but few know why or how they can avoid the mess of probate.
In this blog post we’ll look at common reasons why probate should be avoided, what the “messy” process of probate actually looks like, and the alternative solution to the probate process. As always, we encourage you to call our office at 913-345-2323 with any questions or concerns you may have about probate and how it could negatively impact your family.
First, let’s define the process that gets so much bad press:
Probate is the court process by which a will is declared as valid or invalid, and the deceased’s estate is administered (the process of disbursing the decedent’s assets).
This sounds pretty straightforward, but the process itself can introduce a lot of unexpected variables, which can cost extra time, money, and stress.
The most common reasons people usually want to avoid probate are:
- The additional cost, which can easily exceed $3,000 or more for common cases.
- The hassles and the time it takes to wind through the process.
- What happens in probate court DOES NOT stay in probate court — it’s a matter of public record so there is no privacy for the family.
So, What Really Happens During the Probate Process?
All probate courts have unique processes and specific forms for filing. Many times, these procedures are specific to the country or even the judge, so there are plenty of custom requirements within a county probate court. This is part of what makes the process so messy. Despite these differences in processes and procedures, we’re going to try and distill it down for you. There are a few common activities that must happen during any probate process.
6 Common Steps of the Probate Process
1. Filing of a Petition for an Estate — this is the process for starting a probate case within the court system. Prior to the actual filing, the Petitioner (generally the same person as the Executor of the estate) and their attorney will need to decide the type of probate filing and gather plenty of details to share with the court. The primary goal of most initial petitions is to open a probate estate and to appoint someone, usually the Petitioner, as the Personal Representative, or Executor, for the estate.
2. Initial Hearing to Appoint an Estate Representative — Unless all heirs waive the requirement for an initial hearing, a hearing will be required to hear any issues related to the request to appoint the Personal Representative. (This is essentially time to speak up if someone thinks the Personal Representative is unfit to represent the estate in a beneficial way.)
3. Inventory and Accounting — once a Personal Representative is appointed, they assume the responsibility for determining the inventory of the estate, the value of the assets, the amount of the debts, and generally represent the
estate for final completion. They are also responsible to the probate court for the proper care and preservation of the estate assets. Typically, this initial inventory is filed within a 30-day window, but some estates require much more time to gather details.
4. Probate Process — during this period of time, creditors, disgruntled family members, or other citizens have forum to address related items to the decedent’s estate. (This is where the skeletons in the closet begin to show up… like Jerry Lewis’ alleged illegitimate daughter or the mysterious creditor claiming the decedent owes them money.) There are requirements for this process and they must be followed, but the probate court becomes the landing spot for any issues that may arise, and families can definitely be caught by surprise during this part of the process.
There can be multiple hearings, multiple delays, multiple filings of information, and an ongoing process to move the estate forward towards completion. In addition, while all of the other things are going on, the Personal Representative is taking steps to liquefy the estate and move towards closure. During this phase, the probate process can be completed, delayed, transitioned into litigation, or move in any number of different directions. This phase can also take an extended period of time, which creates extra stress and extra cost for those involved.
5. Final Accounting of the Estate — eventually, sometimes after years, the probate process moves into the final accounting stage. The final accounting of the estate is presented to the probate court. Again, the courts have specific ways in which this final accounting is provided to the court. Once the final accounting meets the judge’s requirements, it will be filed for the probate case. The final accounting phase also take months or years to be completed.
6. Closure of the Estate — eventually the probate estate is distributed to creditors, heirs, and others after the court approves the Final Accounting.
Some probate estates can be completed in months, while others can take a much longer of time. In all cases, the overall process will be governed by the probate court, overseen by the respective judge, and the process will follow the guidelines of that specific court. There is plenty of opportunity for delay, cost, and frustration.
How Does a Revocable Living Trust Avoid Probate?
It is commonly known in our industry that a revocable living trust will avoid the probate process, because all the assets in the trust avoid probate. So, is there a process to follow with a trust after someone passes away?
Generally, there is a trust administration process, and the biggest difference from the probate process is the trust administration process is completely private. (This is why we don’t know ALL of the details of Michael Jackson or Robin William’s estate, for instance.) The trust defines the steps to follow, and there is room for interpretation along the way, but the state’s Trust Code provides general guidelines for the Trustee to follow.
Although some of the steps are similar to the probate process, all of them are less rigid, they generally do not involve court oversight, and they can be handled efficiently by the Trustee for eventual distribution of the trust. There are recommended steps for a Trustee to follow, and it is too much for this post, but there is much more flexibility for the Trustee to eventually distribute the assets to the beneficiaries.
The Bell Law Firm — Probate and Trust Administration
At The Bell Law Firm we are commonly involved with both probate clients and with trust administration clients. Some of these are complicated, and other are somewhat simple.
We encourage you to give us a call at 913-345-2323 if you need assistance with either a probate estate or the administration of a trust.
Give us a call. We look forward to helping you!