When you search for information about estate planning on the Internet you will invariably hear mention of probate avoidance. If you don’t know much about estate planning, a two-part question is likely to formulate in your mind: what is probate and why would I try to avoid it? Let us endeavor to shed some light on the subject.
Briefly put, probate could be defined as the legal process of estate administration. The probate or surrogate court is charged with the responsibility of determining the validity of the will and supervising the actions that the executor takes on behalf of the estate. If someone was to contest the will, they would make their arguments before the probate court.
That’s a very basic description of what probate is, and the reasons why you’d want to avoid it can generally be broken down to just two words: time and money. The process of probate can be very time-consuming, taking anywhere from several months to several years in some complicated cases to run its course. Of course your heirs do not receive their inheritances until the estate has been closed, so this time is certainly not something that is welcomed by your loved ones in most cases.
Probate can also be costly. There are fees that must be paid to the probate court itself, legal fees, an executor fee, appraisal fees, estate liquidation fees, and accountant fees. All of these expenses can add up to somewhere in the vicinity of 5% of the total value of your estate.
These are the reasons why many people choose to avoid probate, but the fact is that probate is not all bad. If you felt that you were the rightful heir to the estate of a relative and someone presented a will that you thought was invalid you would the welcome opportunity to make your case before the probate court. The supervisory role that is played by the court also ensures transparency as the executor is preparing the assets for distribution.
The bottom line is that probate is sometimes best avoided, but at other times it can provide very useful protections. The best way to determine which approach is best for you would be to consult with an experienced estate planning attorney who will guide you based on the specific plan of your estate and the nature of your wishes.
Mr. Kraft assists clients primarily in the areas of estate planning and administration, Medicaid planning, federal and state taxation, real estate and corporate law, bringing the added perspective of an accounting background to his work.
- Estate Planning for the Blended Family - May 20, 2020
- Does Indiana Have an Inheritance Tax? - May 13, 2020
- Wills and Trusts General Information - May 6, 2020
