Probate is the legal process through which a deceased person's assets and beneficiaries are determined, and then those assets are properly distributed to the beneficiaries in an organized and legal manner. This process typically begins with the opening of a Probate Estate matter with the Court, and submitting the decedent's Last Will and Testament. A Personal Representative is then appointed to supervise the process.
Upon death, the belongings, real estate, accounts and other property of the deceased person must be considered. Some, but perhaps not all, of these items may become assets of their “estate”. Examples of assets that are not included in an estate are accounts that are designated to be paid to a beneficiary upon death, such as retirement plans and life insurance policies, or jointly owned property such as real estate or certain bank accounts.
What is a "small estate"? If the value of estate assets is under $50,000, a simplified process can be used to transfer those assets without Probate. Using a document often referred to as a "Small Estate Affidavit", the heirs can work with third parties such as a bank, the Bureau of Motor Vehicles, or even a real estate agent, to properly transfer ownership of assets. Indiana's small estate laws provide an efficient and cost effective way to navigate this process.
What does it mean to "avoid Probate", and should I avoid it? The word "Probate" often receives negative attention for a variety of reasons. Probate administration takes time (often between six and twelve months), and can cost thousands of dollars in legal fees. Yet it can certainly be a valuable process which allows for the legal and orderly transfer of assets to beneficiaries. For those who desire to transfer their assets in a more efficient and cost effective way, there are tools available. One such tool is a Revocable Living Trust. By properly transferring the title of certain assets to the Trustee of a Trust you have created, and designating beneficiaries to receive those trust assets upon your death, you remove those assets from your "estate". As such, they are not considered probate assets and do not count toward the $50,000 value mentioned above. Instead, the Trustee simply distributes the assets to the beneficiaries according to the instructions in the Trust without the need for Probate. Other methods include using beneficiary designations, or transfer-on-death provisions with products such as real estate deeds, retirement accounts or life insurance policies. Wise planning may help organize your assets so that they are distributed as you desire, without the need for probate administration.
What does it mean to "Probate a Will"? If a person had a Will at the time of their death, it is wise to probate (file) the Will with the court - even if a probate estate is not opened. Although there is a reasonable cost for us to help with probating a Will, there is no filing fee charged by the court. There is an advantage to probating (or filing) a Will: it makes sure that the Will is validated. If a Will is not probated within three years of the person's death, Indiana law will no longer recognize the validity of the Will and the deceased person is treated as though they had no Will at all. Regardless of the plan to open a Probate Estate or not, a decedent's Will should be probated.