With or Without a Will: What Is Probate and How Does It Work?

Talking about probate and someone’s Last Will and Testament can often seem like a morbid and taboo subject. However, it’s important to know about these matters so that you and your family can be as prepared as possible when dealing with an estate. 

So what is probate? And how does it affect an estate and the estate’s beneficiaries? Keep on reading and we’ll take you through everything you need to know!

What Is Probate?

Probate is the process of authenticating the last will and testament if the deceased made one. It includes locating and determining the value of the person’s assets as well as paying their final taxes and bills. Also, the remainder of the estate is distributed to the proper beneficiaries. 

The probate process is supervised by a court. 

When Is the Probate Process Required?

There are specific laws in every state that determine what’s required to probate an estate. You can find these laws in the estate’s “probate codes.”

In Wisconsin, any estate that’s valued at more than $50,000 will have to go through the probate process. The probate process can sometimes be avoided if the estate is subject to certain exemptions. 

Some of these exemptions include life insurance proceeds, assets that are titled jointly with another individual, and any retirement fund where a beneficiary was chosen. Also, assets that are placed in a revocable living trust don’t have to go through the probate process.

If there isn’t a will, then the probate process will still be needed to pay the final bills of the deceased and to distribute their estate. The steps that are involved tend to be similar, whether or not there’s a will. 

Appointing the Personal Representative

A personal representative of the estate will be appointed by a judge. This personal representative is also sometimes called an administrator or an executor . This person will oversee the probate process and they will settle the estate. 

Usually, the decedent will include their choice for the personal representative in their will. If they don’t appoint someone in their will, then the court will usually choose the next of kin. This tends to be the surviving spouse or an adult child.

The individual isn’t obligated to serve as the personal representative and they can decline the position. 

The appointed personal representative will be given documentation that allows them to enter into transactions on the estate’s behalf. This documentation is referred to as “domiciliary letters.”

Identifying and Notifying Creditors

The creditors of the deceased will have to be identified. They will then need to be notified of the death. 

Because it may not be possible for the personal representative to know about all of the creditors of the deceased, they will have to post a notification of the death in a local newspaper. In this notification, they will have to include the name, birth date, and death date of the deceased. 

The personal representative will also need to include the name of the county where the probate estate is being opened and the deadline for filing any creditor claims. 

The personal representative has the ability to object to claims made by a creditor if they believe that the claim isn’t valid. The creditor can then petition the court and have the probate judge determine if the claim needs to be paid. 

Valid claims made by creditors will have to be paid. The personal representative will use funds from the estate to pay off all of the final bills and debts that the deceased left behind. This includes bills that might have been incurred during the final illness.  

Distributing the Estate

When all of the steps in the probate process have been completed, the personal representative will then be able to petition the court for permission to distribute what’s left of the decedent’s assets. These assets will be given to the beneficiaries who are named in the will. 

This may require permission from the court. The personal representative may only distribute after they have prepared a full accounting of every financial transaction that they’ve undertaken throughout the probate process. 

The personal representative needs to list and explain every expense that was paid and all of the income that was earned by the estate. Forms can be provided to the personal representative in order to make this process a bit easier. 

If the will lists minors as beneficiaries, the personal representative also might be in charge of setting up a trust to take possession of these bequests. This is because minors aren’t able to own their own property.

Sometimes, with adult beneficiaries, deeds and other similar documents have to be drawn up and filed with appropriate state officials in order to finalize the bequests.

“Intestate” Estates

An intestate estate is an estate where the deceased didn’t leave behind a valid will. This is either because their will wasn’t considered to be valid by the probate court or because one was never created. 

The main difference is that because there is no valid will, the decedent’s last wishes can’t be obliged. The estate will then have to pass to the closest relatives in an order determined by the law. 

The Importance of Knowing About the Probate Process

Hopefully, after reading the above article, you now have the answer to the question – “what is probate?” By knowing what probate is and how it works, you’ll be able to prepare your estate or the estate of a loved one. 

Are you looking for legal guidance with estate planning? Contact us today and see how we can help you! 

Living Trust versus Will: What’s the difference?

Estate planning worksheet for writing a willIn the past few years we’ve had more clients in our Wisconsin offices asking about revocable living trusts and whether or not a living trust is right for their estate planning. While we can’t answer the latter question here (make an appointment to find out if a living trust is right for your situation), we can give you a basic overview of revocable living trusts and wills.

Will

The will is the most common estate planning document. A will is a legal document (find tips for drafting a legal will here) that details your wishes, such as guardianship of minor children, distribution of assets, and who the executor is that carries out your wishes. Other than drafting a will and other important estate planning documents, no other actions may be necessary during the estate owner’s lifetime.

Revocable Living Trust

A revocable living trust is a legal document that outlines your assets and distribution. The living trust is revocable at any time. In a living trust, all assets are placed in a living trust and a trustee is appointed to manage the assets. Typically, the trustee is the estate owner during their lifetime and is transferred to another party or parties when necessary.

Similarities

A revocable living trust shares similarities to a will. Both legal documents dictate the distribution of your assets and should be established during estate planning prior to one’s death. Also, estate taxes are the same for estates with a will and living trust.

Differences

There are some key differences between these estate planning documents, however. A revocable living trust is not a public document, making all matters private. When an estate is in a living trust, the estate does not have to go through probate. All wills have to go through probate, which can take longer (in some cases months or years) and incur more expenses to the estate. Overall, it is easier to create and make changes to a will than it is to a living trust. A living trust has more initial costs during set-up than a traditional will.

What is right for you

Your lawyer can discuss whether a will or revocable living trust, or a combination of both (a “pour over will”), is right for your situation. Make an appointment to get the process started and determine which legal option is right for your estate and your family.

The materials on this website are provided for informational purposes only and do not constitute legal advice. These materials are intended, but not promised or guaranteed to be current, complete, or up-to-date and should in no way be taken as an indication of future results. Transmission of the information is not intended to create, and the receipt does not constitute, an attorney-client relationship between sender and receiver. You should not act or rely on any information contained in this website without first seeking the advice of an attorney.