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Why Is Avoiding Probate Important?

Avoiding probateProbate avoidance is a common estate planning goal, and one that you may wish to include in your estate plan. Of course, before you can decide whether or not avoiding probate should be one of your estate planning goals you need to have a thorough understanding of the probate process as well as why it is that people make such an effort to avoid it. For most estates, it is not possible to completely avoid probate; however, by incorporating probate avoidance strategies into your estate planning endeavors you will likely be able to significantly reduce your estate’s exposure to the probate process.

What Is Probate?

When you die, you will leave behind assets. Assets may include real and personal property as well as tangible and intangible assets. All of those assets will make up your estate for purposes of the probate process. Probate is the legal process that is required of most estates after the death of the estate owner. Probate has several purposes, chief among them identifying probate assets, paying creditors of the estate, and eventually transferring assets to the intended beneficiaries or legal heirs of the estate.

What Are the Steps in the Probate Process?

Although the probate process is unique to each estate, there are several steps that are common to the probate of most estates, including:

  • Opening probate. Anyone who has custody of the decedent’s Last Will and Testament, usually the Executor, is legally required to submit the Will for probate. Typically, the Executor also files a Petition to Probate at that time which serves to begin the probate of the estate. If the decedent died intestate, or without a Will, almost anyone can volunteer to be the Personal Representative of the estate and begin the probate process.
  • Identifying, locating and valuing assets – all assets owned by the decedent at the time of death must first be identified and then located and secured by the Executor of the estate. The larger the estate, and the more complex the assets are, the more time consuming this can be. A “Date of Death (DoD)” value must also be obtained for all estate assets. This may require the assistance of professional appraisers for real property or valuable assets.
  • Identification of heirs in an intestate estate. If the decedent died intestate, all legal heirs of the estate must be identified because the intestate succession laws of the State of Illinois will determine which of those heirs inherit the decedent’s estate and in what proportion they inherit.
  • Notifying creditors and paying claims – known creditors of the estate are usually personally notified while unknown creditors must receive notice via publication. Creditors then have a specific amount of time within which to file a claim against the estate. Claims are reviewed and approved claims are paid out of estate assets if sufficient assets are available.
  • Litigating any challenges to the estate. In the event anyone challenges any aspect of the estate, such as by filing a Will contest, the Executor must defend the estate and the Will submitted to probate. During this time, the probate process basically comes to a halt. A Will contest must be filly litigated before the probate process can resume because the outcome of the litigation will determine how the estate is probated from that point on in the process.
  • Calculating and paying estate taxes. Federal gift and estate taxes must be calculated and any tax obligation due from the estate must be paid before assets from the estate can be transferred to beneficiaries or heirs.
  • Transferring assets to beneficiaries/heirs. The Executor is finally able to transfer the remaining estate assets to the intended beneficiaries or heirs of the estate.

Why Is Avoiding Probate Such a Popular Estate Planning Goal?

As you can see, the probate process can be lengthy as well as costly. As a general rule, the larger the estate that is probated, the longer it takes to get through the probate process. In turn, the longer it takes to probate an estate, the more it costs the estate in terms of fees and expenses associated with the process. Finally, and often most importantly, estate assets that are held up in the probate process are inaccessible to intended beneficiaries, potentially leaving them with insufficient assets to survive on until the probate process is finished.

Contact Us

If you have additional questions about probate avoidance strategies, or estate planning in general, in the State of North Carolina contact the experienced estate planning attorneys at The Law Offices of Cheryl David by calling 336-547-9999 to schedule an appointment.

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