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The Probate Process
If you die with a valid Will your estate will go through the probate process. If you die without a Will, owning property, your estate will also have to go through Probate. Probate is the process of admitting your Will as a valid legal document, and then disposing of the property of the estate according to the guidelines set forth in the Will. In a larger sense, probate is the process of gathering up your assets, paying your debts, expenses and taxes, and distributing property to designated beneficiaries.
The probate process begins when a decedent’s Will and an application for probate is filed with the Probate Court in the town where the decedent lived. A hearing will be held, and absent objections, the Executor nominated in the Last Will and Testament will be appointed. In the case where there is no Will the court will appoint an “Administrator” to perform the same functions an Executor would. The court may impose a bond on the Fiduciary (the Executor or Administrator). The bond acts as an insurance policy that will reimburse the estate should the Fiduciary misappropriate estate funds or property.
Once appointed the Executor or Administrator should secure the property of the estate. In effect, the Executor should take possession of the property in the name of the estate. This involves transferring bank accounts and brokerage accounts into an estate account. Changing the names on stock certificates to the estate is also necessary. If the decedent owned any real estate, the Executor must also file a Certificate of Notice on the land records in each town where the decedent owned real estate. It is important that the Executor not co-mingle the estate assets with those of the Executor. This would be a clear breach of the Executor’s duty.
After the Executor or Administrator takes possession of the assets of the estate they should inventory it. Only property that is in the decedent’s name should find its way into the inventory. The inventory should include any solely owned real estate, assets (such as bank accounts, and stocks), personal property worth a great deal of money (jewelry, automobiles, etc.) and insurance policies that are payable to the estate. You do not need to itemize household goods unless they are valuable. After the inventory is complete it will need to be filed with the Probate Court.
The Executor is also responsible for notifying creditors to file claims. The Executor should convert the property to cash as needed to pay claims against the estate, legitimate debts of the estate, taxes and administrative expenses associated with probating the estate. The Executor must file state and, in some cases, federal estate tax returns, and pay any taxes due. Unlike income taxes, estate tax returns must be filed, even if there is no tax due.
After all claims, debts, taxes and expenses have been paid the Executor must file a final accounting with the Probate Court. The accounting should detail the property received and expenses during the settlement of the estate. The remaining balance is available to be distributed to the beneficiaries. After the beneficiaries have been paid, the Executor may then file a closing statement with the Court ending the probate procedure.
There are situations where a person will die intestate (without a valid Will), and their property will be transferred outside of the State of Connecticut Intestate Succession Laws. Intestate succession laws will only aid in the distribution of “probate property.” Probate property can best be illustrated by way of example. The following is a list of property that would be considered probate property: property held solely in the decedent’s name, property owned as tenants in common, and life insurance policies payable to the estate. Probate property will pass either according to your Will or by the State of Connecticut Intestate Succession Laws.
Nonprobate property on the other hand, passes under the direction of an instrument which becomes effective before the decedent’s death, and hence does not pass under a Will or via the State of Connecticut Laws of Intestacy. The following is a list of property that would be considered nonprobate property: property held as joint tenants (such as jointly held real estate and bank accounts), life insurance paid to a named beneficiary, interests in Trusts, as well as contracts with payable upon death provisions, such as pension plans, and tax deferred investments like annuities. A qualified estate planning attorney can help figure out how and when to use nonprobate property to the advantage of your estate, and/or point out situations where it might not be in your best interest for the property to pass outside of your probate estate.
In most cases the probate process takes up to a year. Sometimes it can feel like a full-time job, although much of the time is spent waiting. There are certain timetables built into the process that stretch it out. These timetables are necessary to ensure creditors are given adequate notice to file their claims and for various other reasons. The probate process can be expensive and cumbersome; however, there are ways to avoid probating your estate through the use of trusts.
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