Where to start as Executor/Administrator of an Estate

Someone close to you recently passed away and you think you were named as the executor of the estate.  Now what?

The first thing you should do, is locate the will.  If you don't already know where the will is, look in important places (an important papers file, a safety deposit box if you can access it, a safe in the home, etc.) and talk with other family members and close friends to find out if they know where the will is located.

Once you have the will, there are two things you need to start doing as soon as possible:

1. Track down ALL of the property owned by the deceased person.
2. Admit the will to probate.

As to number 1, hopefully you had previously read my blog post on the importance of discussing this issues ahead of time.  If no, to track down all of the property, you may need to hire some professionals to assist.  Again, talk with family members and friends to try to determine what all was owned by the deceased person. 

For number 2, you typically need to take the ORIGINAL will to the courthouse in the city or county in which the deceased person resided.  You will want to make sure you are in the Circuit Court building.  Depending on the set up of the clerk's office in the courthouse, there is most likely a probate clerk and that is the person with whom you want to speak.  The probate clerk can help you through the process.  During that process, you will sign an oath, likely pay a bond, and be given instructions on your duties moving forward.

Admitting the will to probate is just the beginning on the probate process (which is described briefly here).  I strongly suggest you speak with an attorney as soon as possible to ensure you are adequately performing your duties as the executor throughout the entire process.

If you would like more information or a consultation, please contact us at (804) 447-0146 or clbaudean@baudeanlaw.com.

How to Avoid Probate

As discussed in my previous post, probate can be a very difficult, complex, time consuming process.  The good news is, there are ways to avoid the probate process!  Here are a few ways to avoid the probate process.  Before doing any of the things listed below, I strongly suggest you consult with an attorney to fully plan your estate and ensure the best result for you personally.

Living Trusts: A living trust is a document that creates an entity that owns your property.  In it, you name the trustee (the person who controls the property in the trust) and the beneficiary (the person who gets to use the property for their benefit).  The trustee and beneficiary can change throughout time and upon certain acts, such as your death.  You can use a trust to hold your property for your benefit while you are alive, and for your relatives benefit after you are deceased.  Property held in trust in this way does not go through the probate process as it is owned by the trust and not a part of your "estate".

Deeds and Titles of Ownership:  You can also avoid probate with some property by titling it in a manner that allows it to automatically transfer to a certain person upon your death, rather than go through the probate process to have that ownership transfer.  This can be done with property such as automobiles, real estate, etc.

Joint Bank Accounts:  You can avoid putting your funds held in bank accounts through the probate process by putting the bank account in your name and another persons name as joint owners.

All of these methods have pros and cons and before you use any of these methods, you should at least have an estate planning consultation with an attorney to ensure you are using the best methods for your specific circumstances.  If you would like a consultation on estate planning, please contact us at (804) 447-0146 or clbaudean@baudeanlaw.com.

A Note to Future Administrators/Executors of Estates

You may or may not know that you will be an administrator or executor for an estate.  Let's put that in simple terms: you may or may not know that you will be in charge of dealing with your parents'/siblings'/friends' property when they pass away.  If you know, READ THIS.

If you don't know, talk with your family and close friends.  Find out if they have a will or trust in place and if you are named in the will as the person in charge of dealing with their property (administering their estate).

While it is not a fun topic to think about or discuss, you should be meeting with an attorney NOW.  I know, from personal and professional experience, that the probate process can be complicated.  Probate, by the way, is the process by which you account to the state and heirs for the property that the person who passed away left.  This will outline some of the major issues you may run into with probate.  Please note that probate is a complex topic and cannot be fully explained in one article. However, if you think you may be involved in this process at some point in the future, it would be in your best interest to talk with an attorney extensively to prepare for that process now, rather than later.  The later you wait to understand what all is involved, the more complicated the process will be and the more room there will be for errors.

Probate requires a full and complete accounting of all property left by someone who has passed away.  The process begins by "qualifying" as an administrator or executor.  This means signing an oath that you will accurately report and distribute property and in most cases, posting a bond to ensure that oath.  Once you have qualified, you have a certain period of time to deliver an "inventory" to the Court (or appointed body known as the Commissioner of Accounts).  This is a full listing, including values, of them property left by the person who passed away.

After the inventory, you will have to file "accountings", showing the Court or Commissioner of Accounts (and likely all heirs) how the value of that property has changed (yes, this means if a savings account earned 12 cents, you have to let everyone know) and show any property that has been distributed (i.e., Mom's will said your sister gets the piano, you have to show that you have transferred the piano to your sister).  This typically has to be backed up with bank records, receipts, etc.

Once all property has been distributed, a "final accounting" will be filed, in which you show the Court or Commissioner that all of the property has been distributed and the value of the "estate" (that vague entity that, in an oversimplified definition, means property owned by the person who passed away).

Throughout this process, certain people can object to your accountings (most likely heirs) and if not properly done, the Commissioner of Accounts or Court can reject your accounting and make you try again.  There are also other things that should be done during probate such as a "debts and demands" hearing and a "show cause against distribution" but we will leave those topics for a future post.

As I've outlined briefly above, the probate process can be extremely difficult and complex.  The more you know about the process and the property you will be in charge of distributing beforehand, the more prepared you can be and more you can ease the process of probate.  If you would like more information on the probate process and a consultation on what to expect, or help navigating through the probate process, please contact us at (804) 447-0146 or clbaudean@baudeanlaw.com.

Why Should You Set Up A Trust?

There are many, many types of trusts but for the purposes of this post we are talking about simple trusts, either created by you during your lifetime or created upon your death through your will (see earlier posts regarding wills).

An inter vivos trust, or living trust, is created while you are living.  This is simply set up for you to transfer your property to.  The trust will have a trustee, who controls all of the property in the trust, and a beneficiary.  You many want to set this up for a couple of reasons; the biggest reason is to save your family the trouble of dealing with the probate process upon your death.  Trusts are also more difficult to challenge than a will, though certainly not impossible, and may be a good idea if you expect someone to challenge your will.  Keep in mind, however, trusts can be expensive to maintain and will have certain tax consequences that you should consider prior to creating a trust.

You can also create a trust through your will that will be created upon your death.  You would typically do this if you want to give your property to someone, such as your young children, but want someone more mature, experienced, etc. to handle that property.  In that case, you can set up specifics about how you want the trustee to distribute the property, such as a for education or living expenses, or a certain amount at certain times.  The same consequences mentioned above still apply to this type of trust as well.

If you are looking to create a trust, consult with an attorney to determine the best plan for you and your property.