The first part of this mini-series highlighted the probate process, a common real estate phrase that is often misunderstood. We served an overview of the topic, listed the cases in which the probate process may kick in, and mentioned instances in which you can avoid probate.
To get a better grasp of the subject, you may want to take a minute and skim through Part 1 first. No problem, I’ll wait…
What we also did mention, as you will have noticed, is a character in the probate play known as an executor.
An executor is the person tasked with the responsibility of overseeing the distribution of the estate. S/he could be mentioned in the will by the decedent, and if not, the relatives of the deceased can name one. If there are any issues with this, then what the court does is appoint a neutral third party to administer the same.
Briefly, let’s look at the duties of the executor in the process.
Role of the Executor
When someone dies, their assets are collected and inventoried, their debts – if any – have to be settled, so do any outstanding taxes and expenses. The remaining assets also need to be distributed going by the specifications of the will.
The whole thing could entail asset valuation, asset seizure and sale as necessary in order to settle any debts and expenses. The beneficiaries and creditors must also be notified of the happenings.
Now, the person who oversees all this is the executor. They aren’t necessary unsympathetic characters like the debt collector, or taxman, unless the deceased was steeped in debt.
The estate of the deceased becomes a separate tax entity during probate, so it is also the job of the executor to obtain a federal identification number and open a bank account under the estate’s name. This is the account from which the estate’s tax returns are filed (as is the final individual tax return) and also from which all creditors are paid their dues.
How Long Does Probate Take?
Probate can be kickstarted immediately following the demise of estate owner and takes less than a year in the case of small estates (usually a minimum of four months) although this will depend on state law. This timeline could extend to several years where larger estates are involved.
This is assuming everything is in order, and by order this is what I mean.
First, if the decedent left a valid will, and there are no disputes and the estate is not complicated, the process will be easier and shorter.
It gets more complicated and lengthy if the decedent did not leave a will. Considering there is no will to specify who the beneficiaries are, the remaining assets (following debt settlement, mortgage, taxes etc.) will be distributed based on state law. What happens in most states though, is that the court lends precedence to the decedent’s spouse, followed by his/her children.
Another scenario when probate can take much longer is if the estate includes property that takes time to sell, or the will or executor is being contested.
Generally, the process will involve these steps:
- Filing the will in court (if there is one), usually a routine matter
- Appointment of executor
- Appraisal of the estate’s assets
- Settling of any taxes and outstanding bills, including expenses incurred by the state
- Division of the estate or remaining property in accordance with the stipulation of the will or state laws
Note that the probate process is not usually as straightforward as this may lead you to believe, considering you have to contend with issues like legal notices to notify heirs and/or creditors, as well as several months’ claims periods.
The secret to avoiding a lot of drama is to draft a will and have it notarized, but life being what it is, this is not always the case unfortunately.