Probating a Will

[Car-Guy]

I've noticed a number of threads in recent weeks talking about Wills and probates and it got me thinking about all this "stuff".

For those would have gone through the process of probating a Will in the past few years, how long did it take to complete the process and what did it cost? I realize how the Will was created, the complexity and value of the estate, the number of heirs, local laws, etc are all going to affect the timing and cost, but I was wondering what some of your experiences were, if you care to share.

I haven't done it myself yet but I know I'm named as the executor in a couple of Wills and I'm wondering what I'm in for, if I should decide to accept the role.

 

[Souschef]

The only one I ever dealt with mas my MIL's. She had a simple will, my DW was an only child, and in PA it took less than a week.
All my MIL had was some stock and some CD's, so it was simple. It get very complicated with businesses, real property, and anything else that cannot be readily converted.

 

[marko]

It may vary from state to state. In my uncle's case it took almost a year. The attorney's fee was set by the state of Missouri as a percentage of his estate.

In my uncle's case it was quite a sum; mid-five figures for a fairly straightforward probate.

 

[misanman]

I was the executor for my father's estate and I believe it took 4-6 months. Some of this seems unavoidable to me. We had to make sure we received and paid pending bills, publish the death and wait for any claims that might come in, decide whether to sell securities or to transfer to hiers in kind, file final tax returns, and sell or transfer real estate. I don't remember what the costs were but they didn't seem unreasonable.

After all was settled and closed, I still received a claim from a company that had completed but not billed some repair work they did for DF before he died. I don't doubt they did the work but they shouldn't have delayed on the billing.

 

[Bamaman]

If you get down to it, probate is where a judge gives the executor the authority to sign legal documentation for the deceased. And at the same time, he wants to be assured that the government has been paid their rightful taxes and that other creditors of the deceased has been paid.

If the deceased has no property, very often no will has to be probated.

When my father died, his assets were transferred to my mother--no probate required. When my mother died, I had to probate her will because my sister and I inherited her home--which was on a lake. We were on checking accounts already. The life insurance is not included in the estate--as those that receive the funds are beneficiaries.

If someone dies and has to go through probate, you've got to file with the IRS for a tax number for the estate. Time in probate depends on how long it takes to liquidate assets--and how long the attorney drags his feet. Cost varies greatly--from $600 to a percentage of the estate. The executor will also have to file income taxes on the deceased--and another for the estate. So, these things can get complicated.

It's best to keep all financial matters as simple as possible if someone's aging or if they get in poor health. They also need to be very liquid--investments easily turned into cash.

 

[bradaz2488]

My Dad had a revocable trust but when he refinanced at a lower rate he forgot to put the house back into the trust name. We did not find this out until we sold the house and the title company flagged it. Back in 2005 in AZ any "individual" asset > $50K had to go thru probate. I'm sure this will vary from state to state. I had a friend who was a CPA help me thru the process. From what I remember there was some paper work that had to be filed. I had to show the court that I "officially" notify all immediate family members of his death. There is also a publication listing all people that have died and Dad's name had to be on this list for a certain amount of time to allow any persons or creditors who thinks they may have a claim to his estate. I do not remember the exact time it took to get this thru probate, but I would say at lest 3 months. I know I did not have to pay a % of the asset (house) to the state, but I'm sure there was some fees to process the paperwork. I guess the only upside to probate was since it was 2005 the housing market was on fire and we sold the house for $10K higher then the original sale 3 months earlier, but I still wish the house had been in the trust to make it easier during a very hard time in our lives.

 

[CaliKid]

Totally different state to state. Several states have set fees which (in states like NY and Cali) are very expensive. Other states have simplified procedures which are very inexpensive and quick. The difference between the two could literally be many tens of thousands of dollars and months difference. Thus you should only ask for info in the state you plan to be a resident in the day you die.

 

[kcowan]

We had DW as the sole heir on all the investments, so probate was just the house. Took about 4 months. There was 2 tax returns, her final one and one for the estate both to capture the current value of investments.

 

[imoldernu]

Just had this discussion with my oldest son, who will be executor.
DW and I completed an on-line will a few years ago, witnessed and legal, but so far have not used legal counsel.

We have concurred that at this point, legal counsel is still premature, as in the coming years there will likely be major changes, considering our advanced age and the probable divestment of our FL Lake Griffin Harbor home and our Woodhaven Lakes camp.

We looked at a revocable trust, but in all honesty our estate is not that big or complicated, and all of our beneficiaries (4 sons) are aware of and in full agreement with our wishes.

DW and I are in agreement that when one of us is incapacitated or has passed away, that the survivor will then review and update our will. 'Til then, it's way down on our worry list.

 

[SecondCor521]

I helped my Dad with my Mom's estate recently. It took 10 1/2 months and cost a few thousand dollars.

She died in June 2016 in Idaho with a will and an A/B bypass trust. Idaho is a community property state and my parents had a marriage settlement agreement, and so she had 50% of my parents' investments. She owned no real property, having sold their home about 10 years prior to move into their retirement facility. Idaho has no estate or inheritance taxes, and everything was very clear and there were no disputes among any of the heirs. Her estate mostly went into the bypass trust.

There was some life insurance but that was handled outside of probate because the policies had long ago been transferred into an ILIT.

Things that took time: We had to wait on the attorney for probably three to four months total to do his stuff. The paperwork that my parents completed was quite old (completed in 1999), contemplated my father dying first, and had not been reviewed or updated for changes in taxes and tax law. As a result, we consulted with estate attorneys and a CPA and decided to do a TEDRA agreement, which took time to write up, review, sign, and submit to the court. We also had to publish a death notice and wait a few months for any creditors (we knew there weren't any, but my Dad wanted to follow the process).

Things that took money: The attorney had to write up the executor appointment papers, the death notice in the paper, the TEDRA agreement, the trust registration, the estate inventory, and an allocation agreement. As noted above, we also consulted with another estate attorney and a CPA, who billed separately for their time and advice.

It was a list of tasks, but my Mom was pretty organized about things and everything was documented and had been discussed and reviewed in general beforehand and my Dad was still around to make the few decisions that remained. Also, Idaho is a pretty laid-back state when it comes to probate requirements from the court. Finally, she died in June and we transferred everything with fortuitous timing, so the only tax return we had to deal with for 2016 was my Dad's MFJ federal and state returns.

If there were squabbles among the heirs, or if assets or liabilities were unclear/missing/had to be searched for, or if the state had higher requirements, or if the estate documents were not in good order, then I can imagine that the job of executor would be exponentially more difficult and unappealing.

On my next update to my will, I plan to include a payment to my executor (my sister) as a token of appreciation for her service and help to my kids who I hope will outlive me, with the option for her to decline it if she so chooses. If you're executor on several other wills, you may want to figure out how you feel about that and talk with those wills' owners as needed. Just a thought.

@imoldernu, I thought wills were individual documents, yet you write as though you have one will for two people. How does that work? Just curious.

 

[Souschef]

When my wife died, we had an A/B trust, and her half went into a QTIP trust. I put half the house in the QTIP trust, so that part of the trust paid half the house expenses, such as mortgage and property taxes
I had to get an EIN and file a 1041 and 541 (CA) every year.
As the estate was spent down, it reached a point, according to the terms of the trust, that the trust could be dissolved.
I filed a final 1041 and 541 and that was that, No probate was involved.

 

[meierlde]

If you get down to it, probate is where a judge gives the executor the authority to sign legal documentation for the deceased. And at the same time, he wants to be assured that the government has been paid their rightful taxes and that other creditors of the deceased has been paid.

If the deceased has no property, very often no will has to be probated.

When my father died, his assets were transferred to my mother--no probate required. When my mother died, I had to probate her will because my sister and I inherited her home--which was on a lake. We were on checking accounts already. The life insurance is not included in the estate--as those that receive the funds are beneficiaries.

If someone dies and has to go through probate, you've got to file with the IRS for a tax number for the estate. Time in probate depends on how long it takes to liquidate assets--and how long the attorney drags his feet. Cost varies greatly--from $600 to a percentage of the estate. The executor will also have to file income taxes on the deceased--and another for the estate. So, these things can get complicated.

It's best to keep all financial matters as simple as possible if someone's aging or if they get in poor health. They also need to be very liquid--investments easily turned into cash.

Actually you have to file for an ID for the estate if it has more than 600 in income in the first year to file the 1041, probate is not an issue here. Anyway that is 3 mins on a web site to do.

 

[brett]

It depends on jurisdiction. We did our own probate. We only had to probate assets that were solely in the name of the deceased. Fortunately we had moved most assets to joint ownership with a sibling. This avoided the probate estate tax.

The final tax return was straightforward. I did it. I picked up a how to probate kit at Staples. It was perfect. Took me a few hours to read through, complete, and print the documents, etc. We searched the Government will database electronically. That was a snap.

We took the completed forms to the courthouse. The clerk looked them over for completeness. We paid, as I recall, about $300. in fees and charges for notarizing two or three documents (court clerk did this as a fee). Plus, we paid about $5K estate tax (tax is based on the value of the asset included in the probate process).

A month or so later we got a call from the courthouse that Probate had been approved. Picked up the probate certificate, took it to the bank, and the funds were immediately released.

In the jurisdiction where we live there is no estate tax. The maximum cost would be something like $360.

 

[eleighj416]

I helped my Dad with my Mom's estate recently. It took 10 1/2 months and cost a few thousand dollars.

She died in June 2016 in Idaho with a will and an A/B bypass trust. Idaho is a community property state and my parents had a marriage settlement agreement, and so she had 50% of my parents' investments. She owned no real property, having sold their home about 10 years prior to move into their retirement facility. Idaho has no estate or inheritance taxes, and everything was very clear and there were no disputes among any of the heirs. Her estate mostly went into the bypass trust.

There was some life insurance but that was handled outside of probate because the policies had long ago been transferred into an ILIT.

Things that took time: We had to wait on the attorney for probably three to four months total to do his stuff. The paperwork that my parents completed was quite old (completed in 1999), contemplated my father dying first, and had not been reviewed or updated for changes in taxes and tax law. As a result, we consulted with estate attorneys and a CPA and decided to do a TEDRA agreement, which took time to write up, review, sign, and submit to the court. We also had to publish a death notice and wait a few months for any creditors (we knew there weren't any, but my Dad wanted to follow the process).

Things that took money: The attorney had to write up the executor appointment papers, the death notice in the paper, the TEDRA agreement, the trust registration, the estate inventory, and an allocation agreement. As noted above, we also consulted with another estate attorney and a CPA, who billed separately for their time and advice.

It was a list of tasks, but my Mom was pretty organized about things and everything was documented and had been discussed and reviewed in general beforehand and my Dad was still around to make the few decisions that remained. Also, Idaho is a pretty laid-back state when it comes to probate requirements from the court. Finally, she died in June and we transferred everything with fortuitous timing, so the only tax return we had to deal with for 2016 was my Dad's MFJ federal and state returns.

If there were squabbles among the heirs, or if assets or liabilities were unclear/missing/had to be searched for, or if the state had higher requirements, or if the estate documents were not in good order, then I can imagine that the job of executor would be exponentially more difficult and unappealing.

On my next update to my will, I plan to include a payment to my executor (my sister) as a token of appreciation for her service and help to my kids who I hope will outlive me, with the option for her to decline it if she so chooses. If you're executor on several other wills, you may want to figure out how you feel about that and talk with those wills' owners as needed. Just a thought.

@imoldernu, I thought wills were individual documents, yet you write as though you have one will for two people. How does that work? Just curious.

I believe they are called a "Joint Will". These wills are not accepted in all states and from my reading, they can be cumbersome to administrate depending upon the verbiage used in the will.

Ed

 

[Ted_Shepherd]

Let me make explicit something implicit in one of the responses here. If the decedent leaves assets in a brokerage account, and has designated someone as the beneficiary, then the assets pass to the designed beneficiary WITHOUT probate. Further, if a will specifies who receives those assets after the owner's death, the designation of a beneficiary SUPERCEDES the will. I am not a lawyer or accountant. My comment here has this support for the Securities and Exchange Commission: https://www.sec.gov/fast-answers/answerstodreghtm.html Excerpt: "Transfer on death (TOD) registration allows you to pass the securities you own directly to another person or entity (your "TOD beneficiary") upon your death without having to go through probate. By setting up your account or having your securities registered this way, the executor or administrator of your estate will not have to take any action to ensure that your securities transfer to whomever you have designated. However, TOD beneficiaries must take steps to re-register the securities in their names. This typically involves sending a copy of the death certificate and an application for re-registration to the transfer agent." (Grim, ironic note: "TOD" is German for death.)

 

[GrayHare]

The complexity and duration of probate are typically in proportion to the dollar value of the assets under probate. Small estates with one beneficiary can wrap up in a month, larger ones with multiple heirs can run years.

Odds and ends can pop up years later. For example, class action lawsuits against a corporation whose stock the decedent had owned. Others are doctor bills that Medicare denies years after the date of death.

 

[Walt34]

As others have said it differs from state to state. I handled my mother's estate in 1999 and the only expense was for the estate tax return since that was over my head. In MD at the time the final distribution to heirs could not be made until the estate was open for one year to give any claimants time to make a claim. Although it was a steep learning curve the main problem was learning the vocabulary and after that it was relatively simple. She had financial assets but no car or real estate to deal with. The bulk of the work was done in six months or so, mostly waiting for final bills to come in and paying those, and filing the needed periodic reports with the court.

In the case of FIL's estate we let the attorney handle that since we could see family squabbles arising from some people and wanted no part of it.

 

[kcowan]

Plus, we paid about $5K estate tax (tax is based on the value of the asset included in the probate process).

It is properly called a probate fee. It only applies to assets that must pass through the estate rather than directly. Description

Income taxes due at death are another topic.