Probate is the legal process by which someone’s estate is handled after that person dies.
It can take anywhere from three months to two years or longer and can be complicated, so it’s important to understand all the implications that probate has on you, your loved one’s estate and your heirs before beginning the process.
Here are some of the major implications of going through probate.
What assets are subject to probate?
Assets that are subject to probate include, but are not limited to, real property, personal property, stocks and bonds, and bank accounts.
If a person has a will that specifies who they want their assets to go to after they die or if they have no will at all, those assets won’t be subject to probate.
However, if there is no will, then these assets would have to be passed by the court through probate.
Probate can take months before it’s finalized which means that someone could potentially make an offer on the house while it’s in limbo and back out later when they find out about it.
Probate also causes expenses like attorney fees, executor fees, accounting fees, and appraisal costs.
These expenses can easily cost tens of thousands of dollars depending on what type of asset you’re dealing with.
Some states waive some of these fees for people with less than $50,000 worth of assets.
Keep in mind that even if you don’t have to go through probate because you didn’t leave any assets behind, your spouse might still need to do so on your behalf if he/she inherits anything from you.
How long does the probate process take?
The probate process can take anywhere from six months to a year, depending on the complexity of your estate and how many assets need to be sold or divided. On average, it takes a year.
However, if you are looking to inherit someone’s property, you should know that you have a set time limit within which to file a claim with the court (usually within two years after they die).
And if you don’t do so by then, all rights will be transferred back to their original owners.
There is also an exception for children born after the parent’s death – in this case they could file claims up until their 21st birthday.
Probate often costs between 2% and 4% of the value of everything in the person’s estate, but when you include attorney fees and other miscellaneous charges, these numbers can really add up. So if someone has an estate worth $10 million, probating it would cost them around $200K-$400K.
Another consideration is taxes: those who owe taxes may want to consider taking out loans or getting help from tax professionals before selling any assets.
How much does it cost to go through probate?
The total cost to go through probate varies depending on the size and complexity of your estate. On average, probating an estate can cost between $10,000 and $15,000.
Even if you have a fairly simple estate, there are certain fees that may come up (such as court fees) that can add up quickly.
It’s also important to keep in mind that probate proceedings take at least six months to complete.
And during that time, the executor must continue managing the deceased person’s financial affairs and pay their bills—which could include funeral expenses—out of their own pocket until the estate is officially closed.
A probate lawyer will typically charge 10% for their services, which means that this process could end up costing much more than what was initially anticipated.
In addition, the costs associated with administering and settling an estate can be difficult to estimate.
For example, it might turn out that some debts or taxes need to be paid before distribution of assets is finalized.
Costs for these items could come out of the executor’s pocket or be passed along to beneficiaries who inherit from the deceased person’s estate.
Are there any benefits to going through probate?
The probate process can be beneficial to those who want to get their affairs in order and make final decisions about property distribution. It is also a way to ensure that assets are distributed according to the wishes of the deceased.
Estate law varies by state, so it’s important to consult with an attorney in your area if you’re considering this process.
In addition, going through probate is often a time-consuming process that may involve court costs and fees as well as additional estate administration costs.
These expenses must be taken into consideration when weighing the pros and cons of choosing this route.
Probate proceedings vary from state to state, but typically entail filing for legal guardianship or executorship of the estate, gathering documents pertaining to the deceased’s will (if applicable), distributing any remaining assets according to instructions outlined in wills (again, if applicable) and closing out all estates involved in the probate process.
Probates often take months or even years before they come to completion due to some cases being more complex than others.
Are there any alternatives to going through probate?
Going through probate is a long, drawn out process that can be difficult and expensive. There are alternatives to going through probate, but they all require careful planning.
One alternative is to set up a living trust with provisions for what will happen to your property if you pass away.
This document would establish who will take care of your property when you die and how it will be distributed among your heirs.
It also includes instructions on what should happen to your assets if you become incapacitated or incompetent.
In order for this option to work, someone else needs to serve as trustee (the person who controls the assets) in case something happens to you and at least one beneficiary needs to be over 18 years old.
Another option is called payable on death or inheritance. With these options, any bank account or retirement plan would go straight from your name into another’s without ever passing through probate court.