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10-25-2017, 02:02 PM
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#1
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Thinks s/he gets paid by the post
Join Date: Nov 2006
Posts: 1,640
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Probate Necessary?
I'm trying to figure out if probate will be necessary for my dad when the time comes. He's 96 and is doing fairly well - hopefully for a long time.
His situation:
All bank accounts are jointly owned between dad, me and my brother (only heirs).
Stocks accounts are all TOD
Car is jointly owned
House is TOD
The only property left that would be subject to probate would be household furnishings - worth maybe $5K, if that.
He has a Will leaving everything to my brother and I. Is probate even necessary in cases like this? Have others gone through this and not gone through any kind of formal proceedings? Thanks!
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10-25-2017, 02:06 PM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,374
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Probably not... most states have a small estate exemption where probate is not required... it is $10k where I live.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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10-25-2017, 02:24 PM
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#3
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Thinks s/he gets paid by the post
Join Date: Aug 2011
Posts: 3,606
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It appears that all of your "titled" property is either jointly owned or has a "beneficiary" associated. In this case, a death certificate should normally suffice.
Practically speaking the household furnishings would not require a probate unless maybe some third party is in control of these items.
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10-25-2017, 02:37 PM
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#4
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2014
Posts: 7,373
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I'm not a lawyer but DH had a will and I didn't put his estate through probate. He had no debts, the cars were in my name, he had a small IRA and I was the beneficiary, and he had about $225 in his checking account. (I was 15 years younger and managed the money so we were comfortable with this setup.) Bank of America must tap into the SS death database because they initiated contact with me and after I filled out various papers I got the checking account balance.
When my Ex died in 2010 (DS was next of kin and I wanted to take some of the work off of his shoulders), I consulted a lawyer. My Ex died penniless, mostly on public support and probably with debts. The lawyer said it wasn't necessary to open an estate and if a creditor found us and asked for money, we could tell them that they were free to open estate proceedings but there was no money to be had. Luckily, that never happened.
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10-25-2017, 03:45 PM
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#5
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Moderator
Join Date: Feb 2010
Location: Flyover country
Posts: 25,362
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OP's situation is exactly the same as mine when my mother died in 2012. I went into the county probate court office to double check and they confirmed no action was necessary.
But every state is different, so you should check your state's rules.
__________________
I thought growing old would take longer.
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10-25-2017, 03:52 PM
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#6
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Moderator
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 25,346
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Quote:
Originally Posted by PatrickA5
The only property left that would be subject to probate would be household furnishings - worth maybe $5K, if that.
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One thing to be aware of if there is a state estate tax then you may need to have the value of the furnishings assessed, even if no tax will be due. This was the case in MD when I handled my mother's estate. I think they just want to be sure you're not hiding some priceless artifact and calling it "furnishings".
__________________
When I was a kid I wanted to be older. This is not what I expected.
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10-25-2017, 04:33 PM
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#7
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Thinks s/he gets paid by the post
Join Date: Nov 2006
Posts: 1,640
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Thanks for the replies!
I ended up sending the lawyer that did my Will an email asking the same question. Much to my surprise, I got an immediate answer (with no charge!). She said that there's nothing to be done other than split up the furnishings or sell them.
Now, if I can only get my FIL's estate planning in the same position. He refuses to tell my DW much of anything about his finances. He has a sealed envelope with all of his accounts listed which is absolutely NOT to be opened until he's dead. Really?
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10-25-2017, 05:16 PM
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#8
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Thinks s/he gets paid by the post
Join Date: Dec 2014
Location: St. Charles
Posts: 3,919
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Quote:
Originally Posted by PatrickA5
Now, if I can only get my FIL's estate planning in the same position. He refuses to tell my DW much of anything about his finances. He has a sealed envelope with all of his accounts listed which is absolutely NOT to be opened until he's dead. Really?
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My guess is that someone is going to be surprised.
__________________
If your not living on the edge, you're taking up too much space.
Never slow down, never grow old!
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10-25-2017, 05:31 PM
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#9
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2014
Location: Huntsville, AL/Helen, GA
Posts: 6,002
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If you really get down to it, probate is where a judge is giving the executor the authority to sign for the deceased in order to liquidate assets. Of course the judge will want to make sure debts, including taxes, have been paid.
The problem is real estate. If it is jointly owned with the kids, the "basis" will be what the property cost new. If the property is signed over to the heirs thru probate, the basis is the current market value at time of dad's death. The higher
the basis, the less taxes will be paid when the real estate is sold.
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10-25-2017, 05:37 PM
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#10
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,374
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Bamaman, as I read the OP the real estate is TOD rather than jointly owned so the heirs would get a stepped up basis but the property avoids probate (much like a tax-deferred retirement account with beneficiary designations avoid probate).
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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10-25-2017, 05:44 PM
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#11
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Thinks s/he gets paid by the post
Join Date: Aug 2011
Posts: 3,606
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Quote:
Originally Posted by PatrickA5
Now, if I can only get my FIL's estate planning in the same position. He refuses to tell my DW much of anything about his finances. He has a sealed envelope with all of his accounts listed which is absolutely NOT to be opened until he's dead. Really?
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I wouldn't sweat it too much.
The Probate Personal Representative should be able to figure it out. Pull old Income Tax returns, look at statements that come in the mail etc. (although if the statements come via email you may be scr*wd. Yahoo and other big email providers will not typically honor Probate documents to surrender passwords. Fortunately I had my Dads email setup with a domain that I controlled which forwarded to his yahoo account. I just changed where the email address pointed to so that I could begin receiving his email at a new location that I controlled).
Even if the Personal Representative does not find all the assets on the first go around, I believe there are eschetement laws in all 50 states that require the companies to turn over dormant account funds to the state to be held for the heirs to come forward and claim them.
A good question to ask him is that if a will exists in the envelope or not. If no will can be located, then assets will go by default to closest family members as defined by state law.
-gauss
"Experienced and Proud Personal Representative"
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10-25-2017, 05:51 PM
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#12
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Thinks s/he gets paid by the post
Join Date: Apr 2016
Location: Ex-Cali
Posts: 1,245
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No probate but remember that with TOD the D is for death and not disability so if he ends up disabled for 5 years how will you access those funds to pay his bills? Most banks do not honor POAs unless it's their POA form.
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The plan was September 1, 2022 and I am 95% there. Still working a few hours a week at the real job.
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10-25-2017, 05:54 PM
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#13
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: Williston, FL
Posts: 3,925
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As far as I know, the only thing you need to go through probate for is things that you cannot get changed into your own name without it.
Household items would not need probate. A C/D at a bank, in your father's name exclusively would. Property likely needs probate.
Of course, you can go through probate for anything you want to...
Transfer the assets. If you hit a situation where you need it, then do it.
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10-25-2017, 05:58 PM
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#14
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Thinks s/he gets paid by the post
Join Date: Aug 2011
Posts: 3,606
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Quote:
Originally Posted by CaliKid
No probate but remember that with TOD the D is for death and not disability so if he ends up disabled for 5 years how will you access those funds to pay his bills? Most banks do not honor POAs unless it's their POA form.
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Conservatorship/Guardianship if he is truly incapacitated?
It will need to be overseen by the Probate Court (apparently unless you live in Nevada - google "April Parks" & prepare to get sick to your stomach if you don't get the reference)
-gauss
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10-25-2017, 05:58 PM
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#15
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Thinks s/he gets paid by the post
Join Date: Nov 2006
Posts: 1,640
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Quote:
Originally Posted by pb4uski
Bamaman, as I read the OP the real estate is TOD rather than jointly owned so the heirs would get a stepped up basis but the property avoids probate (much like a tax-deferred retirement account with beneficiary designations avoid probate).
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Correct. It's a TOD and we should get the stepped up basis even without going through probate. I'll probably have a few realtors come out and give some quotes at that time.
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10-25-2017, 06:07 PM
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#16
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Thinks s/he gets paid by the post
Join Date: Nov 2006
Posts: 1,640
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Quote:
Originally Posted by CaliKid
No probate but remember that with TOD the D is for death and not disability so if he ends up disabled for 5 years how will you access those funds to pay his bills? Most banks do not honor POAs unless it's their POA form.
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Well, my DW does have a POA for him. But, it's one of those "Springing" POA's that requires at least 2 doctors to certify that's he's totally incapacitated. So, I foresee some complications before we even get to the point where the POA is effective. Then, as you said, banks sometimes only want to use there own POAs.
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10-25-2017, 06:15 PM
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#17
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Thinks s/he gets paid by the post
Join Date: Nov 2006
Posts: 1,640
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Quote:
Originally Posted by CaliKid
No probate but remember that with TOD the D is for death and not disability so if he ends up disabled for 5 years how will you access those funds to pay his bills? Most banks do not honor POAs unless it's their POA form.
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Sorry, OP here. I'm getting confused on my own postings. The original post was about my own father. We are joint account owners on all of his bank accounts and CD's. So no problem getting money to use. The TOD was on his house and brokerage account. I've already worked with Scottrade and have the POA and TOD on their forms. The TOD on the house just requires an affidavit and death certificate recorded with the county. So, as far as my own father is concerned, everything is in great shape. My father-in-law is a different story.
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10-25-2017, 06:24 PM
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#18
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Thinks s/he gets paid by the post
Join Date: Nov 2006
Posts: 1,640
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Quote:
Originally Posted by gauss
I wouldn't sweat it too much.
The Probate Personal Representative should be able to figure it out. Pull old Income Tax returns, look at statements that come in the mail etc. (although if the statements come via email you may be scr*wd. Yahoo and other big email providers will not typically honor Probate documents to surrender passwords. Fortunately I had my Dads email setup with a domain that I controlled which forwarded to his yahoo account. I just changed where the email address pointed to so that I could begin receiving his email at a new location that I controlled).
Even if the Personal Representative does not find all the assets on the first go around, I believe there are eschetement laws in all 50 states that require the companies to turn over dormant account funds to the state to be held for the heirs to come forward and claim them.
A good question to ask him is that if a will exists in the envelope or not. If no will can be located, then assets will go by default to closest family members as defined by state law.
-gauss
"Experienced and Proud Personal Representative"
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Father-in-law has a will, but we've never seen it. He says everything is 50/50 between the two daughters. At one point he said he was going to put a new car title with DW as joint owner, but at the last minute "his lawyer told him not to". He's a nice man and I like him a lot, but he's a little paranoid about his money.
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10-25-2017, 07:01 PM
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#19
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Thinks s/he gets paid by the post
Join Date: Apr 2016
Location: Ex-Cali
Posts: 1,245
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Quote:
Originally Posted by gauss
Conservatorship/Guardianship if he is truly incapacitated?
It will need to be overseen by the Probate Court (apparently unless you live in Nevada - google "April Parks" & prepare to get sick to your stomach if you don't get the reference)
-gauss
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Conservatorships (probates during life essentially) are more cumbersome and sometimes more expensive than probates after death. Plus who wants all their business being PUBLIC? No thanks.
__________________
______________________
The plan was September 1, 2022 and I am 95% there. Still working a few hours a week at the real job.
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10-25-2017, 07:06 PM
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#20
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Thinks s/he gets paid by the post
Join Date: Aug 2011
Posts: 3,606
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True - But I wanted to point out that people have options in how they deal with these issues.
Often Estate Planning industry only provides one side of the story.
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