Tax Tip – What is Probate?

Dear Tax Guru,
My mother recently died and her estate is tied up in probate. I believe she has a will and as the eldest child I be bestowed with the honor of sorting things out; Help!

Probate law can be very tricky so let me break it down as simple as possible:

What is probate?

Probate is a legal process that takes place after someone dies. It includes validating the will, inventorying the deceased person’s property and having it appraised. Lastly, any outstanding debts and taxes must be paid, and property is disturbed as the will, or state law, directs. By and large, probate involves lots of paperwork and court appearances and the lawyers and the estate pays court fees.

How does the probate process work?

Since your mom has a will and you elected your self the executor you must file papers in the local probate court. You then must provide a valid will which hopefully documents her property, debts, and who is to inherit what. Once filed, relatives and creditors are officially notified of your death.

As executor you must find, secure, and manage the listed assets during the probate process, which commonly takes a few months to a year. Depending on the contents of your will, and on the amount of your debts, you may need to sell some of her property to satisfy her debts.

If your mom has immediate needy dependents, those family members may ask the court to release short-term support funds during the lengthy probate proceedings. Lastly, once everything is squared away, eventually, the court will grant you permission to pay her debts and taxes and divide the rest among the people or organizations named in the will, allowing the property to be transferred to the new owners.

Not all items must transfer through probate. Most states allow a certain amount of property to pass free of probate or through a simplified probate procedure. Items that pass outside of her will, like through a joint tenancy or a living trust are not subject to probate.

Your best bet is to organize as much as you can and enter the process prepared. Go through all of her important documents and organize her bills. Getting help from your siblings and an attorney are key in having a successful and speedy probate process.