Estates can be complex with multiple real estate holdings, vehicles, stocks, bank accounts, policies and other assets. There is no cookie cutter approach to estate planning since each client is very different. But, with some diligence and advisement from knowledgeable professionals, even the most intricate estate web can be untangled.
By way of example, here is a recent estate administration case, and the steps taken to resolve it.
An Estate by the Numbers
Jane* prepared her Will in 2014, four years before her death in 2018. She has three daughters from her marriage to Bob, who died in 2012, and five siblings. In 2017, Jane got remarried to Jerry, who she was in a relationship with since 2013.
At the time of her death, Jane owned four cars and six properties in three states. In addition, she had a bank account, a portion of her mother’s estate she was due to inherit and a slip-and-fall lawsuit settlement that resolved after her death… all totaling nearly $1.1 million in assets. There was also a business Bob had run with her brother, John, which she tried to keep going after Bob’s death, but it ceased operations and $16,000 remained in a bank account for the LLC, which was still in Bob and John’s names.
She also had $190,000 in debts at the date of her death.
John was named executor of her estate in her Will, which left one car to Jerry and three properties and the rest of her estate to her daughters equally.
Probating the Estate – Standard Steps
John’s first step as executor was to take the original Will and a certified copy of Jane’s death certificate to the Office of the Surrogate 10 days or more after her death. A probate application must be made to the Surrogate of the county where Jane resided at the time of her death. If the Will is self-proving, meaning it was signed by a testator and two witnesses before a notary, then no further proof or testimony is necessary to probate the Will.
John had to sign certain qualification forms and the Surrogate issued letters and certificates evidencing John’s appointment as the estate executor. This appointment was important to allow him to access and transfer assets. He had 60 days from his appointment to notify the heirs, beneficiaries and next of kin that he made a probate application.
As executor, John had certain duties and authorities. These included:
- Collect and inventory Jane’s assets to ensure their safety
- If necessary, seek an appraisal of the assets
- Pay debts and tax
- Distribute the remaining property per the Will’s direction
While the above is standard, the unique circumstances of Jane’s estate also required John to do the following:
- Because Jane owned property out of state, John had to hire counsel in those states so that ancillary probate proceedings could be filed. This had to be done before he could sell or transfer title to those properties.
- John had to contact Jane’s mother’s estate attorney to ensure her share of her mother’s inheritance was distributed to Jane’s estate.
- To pay the outstanding debts, John had to consider selling the vehicles or some of the properties because the estate lacked liquid assets. He could also try to negotiate settlements with the creditors to reduce the debt amount.
- As her husband, Jerry was entitled to an elective share of Jane’s estate in lieu of a Will distribution — meaning he could receive more than was identified for him in Jane’s Will, up to a third of the estate after funeral and administration expenses and claims are paid.
- John needed to dissolve the LLC and work with an accountant to assist in filing any individual or business tax returns
Even the most complex estates can be probated with some diligence and skilled legal counsel. To book a virtual or in-person consultation with one of our attorneys to discuss the best approach to resolving an estate, contact our office at 833.888.0462 or [email protected]
*Names have been changed to protect the client’s privacy.