Probate

Probate Meaning

Probate is undertaken to distribute the property and assets of a deceased person who does not have a will. Alternatively, courts undertake this procedure to determine the authenticity and genuineness of a will. Without a will, the court appoints an administrator to oversee the procedure.

The process is initiated, monitored, and controlled by the court. Probate attorneys specialize in probate laws, wills, testaments, and inheritance laws. The procedure comprises will authentication, validation, and asset distribution. The entire process is completed within six months to a year.  

• Probate is a legal administrative process. It is responsible for dividing and distributing a deceased person's assets and properties.
• A will can save a lot of work for the court—it mentions how the deceased person wanted their property to be divided among the inheritors. Sometimes, there are multiple inheritors—the distribution of property need not be equal.
• In the absence of a will, the probate court appoints an administrator. The administrator is responsible for locating the legal heirs of the deceased—spouse, children, parents, etc. The assets are passed on to a contingent beneficiary if the beneficiary is not present in court.

Probate Explained

After the death of an asset holder, the court appoints an administrator or an executor named in the will to carry out the probate process. Assets are distributed among the beneficiaries once liabilities are cleared. There are cases where there is no will, and the deceased person does not state how ownership of assets is to be passed. Nonetheless, will or no-will, probate procedures must be followed.

A will can save a lot of work for the court as it mentions how the deceased person wanted their property to be divided among the inheritors. Sometimes, there are multiple inheritors, and the distribution of property need not be equal.

When a will is present, proceedings are carried out in a probate court—the will's authenticity is checked—the will is declared the last legal document from the deceased person.

When there is no will, the court initially appoints an administrator who can oversee the estate and assets of the deceased. The administrator here acts as an executioner—the legal voice of the deceased. Probate is also treated as a copy of a will: requiring certification from a competent jurisdiction. This helps prevent and solve future property disputes.

Probate With A Will

• First, an executioner is appointed. This executioner is mentioned when the will is drafted. Later, the executioner acts on behalf of the deceased.
• The executioner performs the role of legal counsel; they oversee the estate and assets till assets and liabilities are transferred to the beneficiaries.
• The beneficiary then evaluates assets and their value on the date of death. Consequently, beneficiaries follow the procedure specified in the Internal Revenue Code.
• Post-valuation, if there are any pending taxes to be paid to the government, it is paid by the executioner. Then, the liabilities are cleared using the deceased person’s assets.

Probate Without A Will

• The process is similar. However, with no will, there is no executioner. Therefore, the probate court appoints an administrator. The role of an administrator and an executioner mentioned in a will is the same.
• The person who dies without a will is called ‘died intestate.’ The intestate process includes the distribution of deceased assets by state laws.
• The administrator is responsible for locating the legal heirs of the deceased—spouse, children, parents, etc.
• Applicable state laws govern the distribution of assets and property. The final decision is based on the legal heirs present in the court. The assets are passed on to a contingent beneficiary if the beneficiary is absent.

Example

Brendon suffers cardiac arrest and passes away without leaving a will. His sole asset was a Penthouse, and his liabilities include the $18,000 he owed to the bank from his mortgage loan and tax defaults amounting to $2500.

The probate court appoints daughter Lara as administrator and directs her to sell the property. In turn, Lara hires an estate agent who tags the value of the Penthouse at $150,000. Consequentially, the house is sold for $145,000.

Now, out of $145,000, Lara has to clear the liabilities first—she repays bank debt of $18,000 and the $2500 tax defaults. After clearing liabilities, Lara is still left with $124,500. This amount is to be distributed among the heirs.

When Is Probate Required?

The procedure varies from one state to another. For example, UK probate laws differ from U.S. laws. In the UK, probate is mandatory only if the deceased person's estate is worth more than £10,000. And if the property is jointly owned, then court proceedings are not required.

In the US, any inheritor may file for litigation by filling out probate forms. Alternatively, beneficiaries can file a petition if they consider the will inauthentic. Court proceedings are also required when will clauses are disputed. Legal actions are undertaken to either claim the assets through rightful and legal distribution or to challenge the will.

Sometimes, lenders have a provision to apply for probate loans taken out against a future inheritance. These loans are also called estate loans or inheritance loans.

Frequently Asked Questions (FAQs)

Recommended Articles

This article has been a guide to What is Probate and its meaning. We explain probate with a will, without a will, an example, and its requirements. You can learn more about it from the following articles –

• Last Will And Testament
• Living Trust
• Joint Owned Property