What is Probate? We’ve all heard about it, and in our minds, it is often accompanied by a sour note on a violin. At its most basic, Probate is the process of getting property out of the name of a deceased person (known as the “Decedent”), and then put into the name of someone else. In other words, it is the re-titling of property. This is often easier said than done, and dependent upon on a multitude of factors.
If the person who passed away has a Will, the Probate Court uses that Will to determine how their property is to be re-titled. However, before this can occur the Will must be “admitted to probate.” During this period, the Court determines the Will’s validity. A Will must meet numerous requirements in order to be valid. During this, the Will is also open to attacks from objectors. Such attacks can include claims that the Will was drafted under undue influence, was fraudulent, or that there was a mistake in the Will. As an example, these objectors could be beneficiaries who aren’t satisfied with the property they were left with; or perhaps people left out of the Will all together. It is important to note that all of this occurs publically, and on a Court Record.
Another concern many have with Probate is the necessary fees. These include the cost of a bond premium, the cost of publication, Court costs, and the personal representative’s commission and attorney fees. Generally the most expensive fees are the personal representative’s commission and attorney fees. These fees are prescribed by statute, and it’s worth noting that they get higher the larger the estate is. The fees are as follows: five (5) percent of the first $5,000; four (4) percent of the next $20,000; three (3) percent of the next $75,000; two and three-quarters (2.75) percent of the next $300,000; two and a half (2.5) percent of the next $600,000; and finally two (2) percent of everything more than a million dollars. It’s important to remember that these fees stack up on each other, as it’s five (5) percent of the first $5,000 for the personal representative and five (5) percent of the first $5,000 for the attorney; four (4) percent of the next $20,000 for the personal representative and 4 percent of the next $20,000 for the attorney, and so on.
If the person who passed doesn’t have a Will, then the Probate court will use Intestate laws to determine how the property is divided. That is, the intentions of the deceased are wholly ignored, and the court essentially applies a uniform formula to divide the property. This complete lack of control is alarming to many, and it should be.
The legacy you’ve built deserves to end up in the right hands. Make sure it does.