Probate is the legal court process for paying a person’s debts and expenses and distributing a person’s property after that person’s death. In a probate matter, the person who has died is called the “decedent,” and his or her property is called the “estate.” Usually, a decedent’s debts are paid from the estate and any property remaining is divided among heirs or beneficiaries, according to a Will or according to state law.
When is probate necessary?
Minnesota probate law applies to people who lived in Minnesota when they died and to residents of other states who owned real estate in Minnesota. Whether a matter is “probated” depends on a number of factors, including the type of property and the nature of the ownership of that property. For example, unless real estate (a home, a cabin, a farm, etc.) was transferred into a trust or was owned as “joint tenancy” property with a right of survivorship, it usually is subject to the probate process. If you are considering a Will, you should consult with an attorney about the ownership of any real estate and whether there are advantages to certain types of ownership.
For personal property, an estate must be probated if the personal property is valued at more than $20,000. If the decedent’s estate is worth less than $20,000, the decedent’s legal heirs may be able to collect the property by affidavit, which does not require probate court involvement. Collection by affidavit allows for a small estate to keep its costs of administering the estate low.
What property does not need to be probated?
Non-probate assets include property owned as joint tenants, jointly held bank accounts, payable-on-death accounts, life insurance proceeds to a specific beneficiary, and pension benefits with a designated beneficiary. The law also provides for transferring a car without involving probate.
Transferring joint assets does not necessarily occur automatically upon a person’s death. For example, to transfer real estate to the surviving owner, an affidavit of survivorship must be filed with the county recorder where the property is. Other jointly held assets require filing specific forms and usually require a certified copy of the death certificate. Consult your attorney about how best to handle transfer of property at death.
How much does it cost to probate an estate?
The cost of probate depends on the specifics of the situation involved. Generally, the expenses of settling an estate include the cost of a funeral, cremation or other ceremony, copies of the death certificate, attorney fees, accounting services, real estate transfer fees, court fees, notices to potential creditors and heirs, and personal representative fees. All of these expenses are paid from the assets of the estate before anything is distributed to the heirs.
Does having a Will help avoid probate?
Not necessarily. Probate is the process of determining the validity of the Will. If property needs to be administered or taxes paid, the existence of a Will does not avoid probate or increase probate expenses. When an owner of property dies, the probate court must decide that the Will is valid or determine who receives the property if there is no valid Will.
With or without a Will, your estate can end up in court.
If all property is held jointly or in trust, probate may not be necessary. However, probate avoidance may increase expenses and taxes and may not be desirable. The advice of a lawyer can help you decide the best plan for your situation.
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