Estate administration, also referred to as probate, is the process of settling a deceased person’s estate. This involves fathering the decedent’s assets, satisfying financial obligations, and distributing assets to the beneficiaries. There may be some significant complexities when a personal representative (also referred to as an Executor or Administrator) carries out their responsibilities.
When the person dies with a Last Will and Testament (Will), the terms of the Will designate an executor and outline how the deceased wanted their assets distributed. When a person dies intestate, or without a Will, state law will govern the disposition of assets. A Virginia Beach estate administration lawyer can help a family or personal representative through this complex estate planning process.
What is Probate?
Probate generally refers to the process by which a decedent’s estate is settled. Although most estates require some sort of formal administration with court oversight, the process may be simplified in certain instances.
When the estate value is $50,000 or less, it qualifies as a small estate, and formal probate is not required. According to Virginia Code § 64.2-601, all the known successors of the decedent can execute an affidavit presented to a person known to be in possession of a small asset owned by the decedent. The person in possession then turns over the asset to the designated successor, whether named in a will or determined by intestacy laws. Talk to an estate administration lawyer in Virginia Beach for help with the transfer of a decedent’s property.
In cases where there is no Will, and the only estate asset is real property, a Real Estate Affidavit can be filed to facilitate the transfer of real estate without the appointment of a personal representative.
What Assets are Included in Probate?
Probate assets are those owned solely by the decedent at the time of their death without a designated beneficiary. These would include any account owned solely by the decedent, bank accounts, real estate, vehicles, and personal property, provided a beneficiary for such asset was not registered. These assets are subject to the probate process, and their distribution is overseen by the Circuit Court to ensure legality and fairness in accordance with the decedent’s wishes or applicable laws.
Non-probate assets, on the other hand, are assets that bypass the probate process. These typically include assets where a beneficiary is named, or assets owned jointly with rights of survivorship. Examples of non-probate assets are jointly owned real estate, retirement accounts with designated beneficiaries, and assets held in a trust. The transfer of non-probate assets is generally more straightforward and less time-consuming, as it is not subject to court supervision or the potential delays and costs associated with probate.
Understanding the distinction between these asset types is crucial as it affects the time, costs, and procedures involved in settling an estate. An attorney in Virginia Beach can help a person understand these distinctions during the estate administration process.
Steps in Estate Administration
The many steps involved in administering an estate are taken in a specific order, with deadlines levied by the court. Generally, these steps include:
Court Filing
Various forms must be filed with the Clerk of the Circuit Court in the city or county where the decedent resided. If there is a Will, it must be filed with these forms. Upon filing, and assuming a personal representative is needed, Clerk of Court will appoint an Executor when there is a Will or an Administrator when there is no Will.
Notification
Heirs, beneficiaries, and creditors must be notified about the probate proceeding and the personal representative of the estate must file an Affidavit with the court regarding such notice.
Inventory and Appraisal
The personal representative must file an inventory of the deceased’s assets with the Commissioner of Accounts, detailing the assets and their value.
Payment of Debts and Expenses
The personal representative is responsible for paying the debts, funeral expenses, and administration costs of the estate using the estate’s assets. In the event the estate is insolvent, the laws of the Commonwealth of Virginia outline an order in which debts may be paid. In such cases, it is often beneficial to proceed with Debts & Demands and Show Cause to ensure that the personal representative is not liable for a failure to satisfy debts appropriately.
Filing of Taxes
Any due taxes, including federal and state income taxes and probate taxes, must be filed and paid.
Distribution of Assets
After paying the debts, taxes, and expenses, the executor/administrator distributes the remaining assets to the beneficiaries according to the Will. If there is no Will, the assets are distributed according to Virginia’s intestacy laws, typically to the closest relatives.
Final Accounting
The personal representative must submit a annual accountings to the Commissioner of Accounts, detailing all the financial transactions conducted on behalf of the estate.
Closing the Estate
Once the Commissioner of Accounts approves the final accounting and all the other requirements are met, the estate can be closed.
While this sounds simple, mistakes are common. An estate administration lawyer in Virginia Beach can ensure the representative handles matters completely.
A Virginia Beach Estate Administration Attorney Uncomplicates the Process
The information provided herein is just a general overview, and many estates have complex nuances that create additional challenges. When you are named Executor under a loved one’s Will or otherwise appointed the Administrator of an intestate estate, you are undertaking a legal responsibility for which a breach could result in liability. As a result, it is important to seek legal help prior to qualifying on behalf of an estate.
Additionally, when you develop an estate plan, you should strategically allocate assets to minimize exposure of your estate to probate, thereby potentially reducing time and expenses and ensuring a direct transition of assets to the heirs or beneficiaries.
Individuals contemplating estate planning or those involved in administering an estate should consult with one of our skilled Virginia Beach estate administration lawyers to navigate the complexities involved in identifying and managing probate and non-probate assets effectively.
