Estate Administration
Estate administration refers to the process of managing and distributing the assets of a deceased person (commonly referred to as the decedent) in accordance with their trust, will or by state law if there is no applicable trust or will. It involves handling various legal, financial, and administrative tasks to ensure the smooth settlement of the estate and the distribution of assets to the appropriate parties.
When most people speak of an estate administration, that term is generally used in a broad sense to include both probate assets (the “probate estate”) and non-probate assets (e.g., assets that are own in joint name, in trust, or distributed by means of a beneficiary designation such as IRA and life insurance).
The key steps involved in the administration of a probate estate include the following, all of which are done according to the process established in each state and, most often, in conjunction with the Register of Wills office:
Non-probate assets skip the judicial process. Joint assets become the asset of the joint owner; IRAs and life insurance are distributed to named beneficiaries; trust assets are distributed according to the terms of the trust. However, even with trusts, the trustee will still inventory the trust assets, determine their value, and make distributions; more often than not, the trustee (well aware of the fact that he/she does not know all that he/she ought to know) will seek legal counsel to assist in this process.
It's important to note that estate administration procedures can vary depending on the jurisdiction, the complexity of the estate, and the presence of any legal disputes. Chesapeake Legal Counsel can help you navigate the specific requirements of your situation and ensure compliance with the applicable laws and regulations.
Too often one hears how much a sibling or other relative changed character after the death of a loved one, especially when it comes to money and who got what. Our goal at Chesapeake Legal Counsel is to bring the administration to a peaceful conclusion with all heirs still speaking to each other.
When most people speak of an estate administration, that term is generally used in a broad sense to include both probate assets (the “probate estate”) and non-probate assets (e.g., assets that are own in joint name, in trust, or distributed by means of a beneficiary designation such as IRA and life insurance).
The key steps involved in the administration of a probate estate include the following, all of which are done according to the process established in each state and, most often, in conjunction with the Register of Wills office:
- Validating the will: The first step is to determine the validity of the decedent's will. This involves verifying that the document meets all legal requirements and wasn't executed under duress or undue influence.
- Appointing a Personal Representative (the “PR”): Term executor (or its female equivalent – executrix) is no longer used in favor of the gender neutral PR. The PR is responsible for administering the estate. If there is no will or no PR is named, the court will appoint an administrator to handle the process.
- Inventory and valuation: The PR compiles an inventory of the decedent's assets, including real estate, bank accounts, investments, personal belongings, and other property. These assets are then appraised or valued to determine their fair market value.
- Paying debts and taxes: The estate's debts, including outstanding loans, mortgages, and credit card bills, must be identified and paid off using the assets of the estate. Additionally, any applicable taxes, such as estate taxes and income taxes, need to be filed and paid.
- Claim period: To a large extent, the probate process is designed to protect potential creditors of the estate. In order to allow such creditors sufficient time to file a claim, the estate must remain open for several months.
- Distributing assets: Once the debts and taxes are settled, the remaining assets are distributed among the beneficiaries according to the decedent's will or, in the absence of a will, based on the laws of intestacy. This process involves transferring ownership of assets, such as transferring property titles and distributing funds from bank accounts.
- Final accounting and closing the estate: The PR prepares a final accounting, which details all the financial transactions, expenses, and distributions made during the estate administration process. This accounting is typically presented to the beneficiaries and the court for approval. Once approved, the estate can be officially closed.
Non-probate assets skip the judicial process. Joint assets become the asset of the joint owner; IRAs and life insurance are distributed to named beneficiaries; trust assets are distributed according to the terms of the trust. However, even with trusts, the trustee will still inventory the trust assets, determine their value, and make distributions; more often than not, the trustee (well aware of the fact that he/she does not know all that he/she ought to know) will seek legal counsel to assist in this process.
It's important to note that estate administration procedures can vary depending on the jurisdiction, the complexity of the estate, and the presence of any legal disputes. Chesapeake Legal Counsel can help you navigate the specific requirements of your situation and ensure compliance with the applicable laws and regulations.
Too often one hears how much a sibling or other relative changed character after the death of a loved one, especially when it comes to money and who got what. Our goal at Chesapeake Legal Counsel is to bring the administration to a peaceful conclusion with all heirs still speaking to each other.