When people die, the distribution of their assets is ideally determined by a clear and legally binding last will and testament. If not, the assets come under the control of the state in which the deceased resided, which determines the best way to distribute them. Laws vary a great deal from state to state.
- A probate court reviews the distribution of assets of deceased persons in most cases.
- Probated wills are a matter of public record and can be reviewed in the Register of Wills office.
- The assets of a person of very modest means do not have to go to probate. State laws set the amount exempted.
The Usual Process
Wills usually go to a probate court to prove their validity. This is a routine process and isn't usually onerous unless the person was extremely wealthy or the relatives are extremely quarrelsome.
There are exceptions to the requirement for probate if the assets of the deceased are below a set dollar amount. The dollar amount varies greatly from state to state, from less than $3,000 in Alabama to less than $150,000 in California. If the assets are under those limits, the family can divide any property as they choose.
Beneficiaries of a will must be notified after the will is accepted for probate. Moreover, probated wills are automatically placed in the public record.
If the will is structured to avoid probate, there are no specific notification requirements. This is relatively rare.
In any case, as soon as the will is proved to be valid, anyone is entitled to view the will at the courthouse where it was filed, including, of course, any person who expects to be a beneficiary.
The Probate Process
A probate is a legal process that establishes the validity of a will. After examining the will, the probate court collects the assets of the deceased and distributes them to the heirs as named in the will.
Beneficiaries must be notified when a will is submitted for probate. In any case, the will is available for public review.
Once the probate court declares the will to be valid, all beneficiaries are required to be notified within a certain period established by state law.
Certain wills are structured to avoid probate. This is achieved by setting up joint tenancy or making a will payable upon death. In these scenarios, there are no formal notification requirements unless specifically stated in the terms of the will.
Probated wills are public record, which means anyone can show up at the courthouse and view them in their entirety. A person who has reason to believe they might be included in a will may thus examine the will.
Each county courthouse files probated wills in a department called the Register of Wills.
Probate is not required in all circumstances. If the deceased has assets below a certain threshold (determined by each state), probate may not be necessary, and the settlement may be handled privately.
Also, certain types of assets do not have to go to probate court. This includes assets that pass by operation of law such as pension assets, individual retirement accounts (IRAs), and other qualified retirement plans.