Probate, the court proceeding governing the distribution of a decedent’s property, is only one process that occurs after that person dies. The decedent’s executor must also perform other several duties that are an important part of estate administration.
These duties include gathering the estate’s assets, paying any debts and final expenses and distribution of the estate’s remaining assets. Assets usually include solely and jointly owned assets, assets that were held in trust, business interests, proceeds from life insurance policies, retirement accounts and certain contracts.
Some property may be non-probate assets where the decedent designated a beneficiary to receive the asset after their death such as individual retirement accounts, 401(k) plans, life insurance policies and annuities. These assets are paid directly to the named beneficiaries and are not transferred under the deceased’s will. Estate administration or court filings may not be necessary for these assets.
Other property may also constitute assets that do not have to undergo probate. These include bank accounts owned jointly by two people where the interest is transferred under a right of survivorship and the co-owner lives after the decedent’s death. Holding property in a trust is usually another effective way to avoid probate court proceedings because the property is transferred directly to the beneficiary under the terms of the trust.
Interests in a business may also be excluded from probate. The governing legal documents for the business must allow for the transfer of the person’s interest without judicial involvement.
The estate pays for certain expenses such as legal fees. However, administrators may need assistance to avoid making mistakes or even being held personally liable for the decedent’s debts. Estate administration may also be challenging if there are disputes among heirs or beneficiaries.
Obtaining legal assistance can help assure that the estate is administered correctly, protect the administrator and deal with problems that may arise. An attorney may also assist with estate planning and draft legal documents that create an effective estate.