Do Not Underestimate the Importance of Proper Probate and Estate Administration
Historically, “probate” was the process by which an individual proved the validity of a deceased person’s last will and testament. Today, the term probate is used along with the term “estate administration” as the legal process of opening an estate regardless of whether the deceased left a last will and testament or died without leaving one.
In Pennsylvania, the process of probate or estate administration starts with the filing of a Petition for Grant of Letters in the office of the Register of Wills for the county in which the decedent lived. Additionally, if the decedent left a last will and testament, then the original will should be produced by the individual named as executor by the will. When an individual dies without leaving a last will and testament, the decedent’s estate will be divided in accordance with the laws of intestacy for Pennsylvania. In such an instance, a relative of the decedent, such as a spouse or child, will typically petition the Register of Wills to be appointed administrator of the decedent’s estate. A general term to describe either the executor or administrator of the estate is “personal representative.”
Opening an estate in Pennsylvania is just the beginning of the estate administration process. The personal representative is responsible for publishing the estate in a newspaper of general circulation and in the county legal journal in the county where the decedent lived. Additionally, the personal representative is responsible for notifying the Pennsylvania Department of Human Services, all heirs, and other interested parties of the opening of the estate in accordance with Pennsylvania law. Moreover, the estate is required to prepare and file inheritance tax returns, estate returns, and any applicable income tax returns and ensure proper payment of the same.
Estate administration also involves ascertaining all of the decedent’s debts and paying them in the appropriate order of priority. In the event that a personal representative was to distribute the assets of the estate too soon or pay certain claims and not others of a higher priority, the personal representative may become personally liable.
If that wasn’t enough, the personal representative is required to file inventories of the estate assets, accountings of his or her actions, and submit periodic written status reports.
The good news is that with proper estate planning, some if not all of a decedent’s assets can be transferred according to their wishes without probate.
Assets That Don’t Have to Go Through Probate
Generally speaking, in Pennsylvania, only assets deceased people owned in their own name alone must go through probate. All co-owned assets can probably be transferred to their new owner without probate court approval. These include, for example:
- Any property the deceased person owned in joint tenancy with another person. For example, a bank account held by the deceased person and his spouse or a house or car.
- Assets for which the person designated a beneficiary while alive—for example, 401ks, IRAs, other retirement accounts, or life insurance.
- Assets held in a living trust by the deceased person.
- Life insurance policies with designated beneficiaries.
- Small amounts of cash, under certain circumstances.
- Wages and money in bank accounts. Employers or banks may release up to $10,000 in wages, salary, or other work-related compensation to the employee’s surviving spouse or some other close family member. Money in bank accounts only requires a certified copy of the death certificate and proof that funeral expenses have been paid.
Not all estates must go through the cumbersome probate process. Small estates, which are estates that contain no more than $50,000, may be eligible for the simplified probate process of filing a Petition to Settle Small Estate. The process begins when the estate executor files a written request to use the simplified procedure with the Register of Wills. The court may allow the personal representative to distribute the deceased person’s assets without going through all the formal requirements of standard probate upon approval of their Petition to Settle Small Estate.
If an estate doesn’t qualify as a “small estate”, the assets that aren’t allowed to be distributed upon death are distributed to beneficiaries through the probate process after the payment of all debts, costs, and taxes. If there is no will, the intestacy laws for Pennsylvania will control the distribution of the estate.
During probate, the court determines the number of issues, such as:
- Whether the will is proved to be valid or not,
- Whether the property covered in the will is the decedent’s or not,
- If there is no will, how is the property to be distributed in accordance with the intestacy laws of the state,
- The opportunity to file claims against the estate by unpaid creditors of the decedent,
- The estate’s administration fees are approved and paid,
- The assets of the estate are distributed, and
- Other probate issues may arise.
It is generally necessary to go through probate before the property can be distributed, or, in the case of smaller estates, a less formal procedure under the general supervision of the probate court.
How a Probate Attorney Can Help With the Probate Process From Beginning Until Final Distribution
If you have been named as an executor or are a spouse or child of someone who has recently passed away, we can help lead you through the probate and estate administration process. We pride ourselves on taking stress off of individuals going through a difficult time. We are able to lead you through the process step-by-step and be a trusted partner in administering the estate properly and in accordance with the law. Contact a probate attorney at Goodwin Como or call us at 724-438-1616 for your free consultation.