While many people have heard the term “probate,” very few of them have any direct experience with the probate process. Because of this, there are a lot of myths and misperceptions surrounding probate that far too many people believe and rely upon.
Probate is the legal process that applies to the property you leave behind after you die. Someone will have to become the new owner of that property, and the law imposes some specific procedures that have to take place in order for this to happen. To get a better understanding of how probate works, let’s take a look at some of the commonly held myths about it.
Myth 1. I don’t have to worry about probate because the death tax means that the state will take all of my property anyway.
This is not true. The so-called “death tax” refers to the federal estate tax. This tax applies only to estates (property left behind by a deceased person) valued in excess of a specific amount. In 2014, the federal estate tax exemption limit is $5.34 million. This means that if you leave behind an estate worth less than the exemption amount, you will pay nothing in federal estate taxes.
Myth 2. I don’t have to worry about probate because I’ve already written a will that lets me avoid it.
It’s hard to tell how myths arise, but this one is completely false. In every state, including North Carolina, a capable adult can create a last will and testament and choose how they want to leave inheritances. However, the will you make must comply with state law.
You never have to submit your will to a court before you die, but the court will nevertheless have to determine if it is in compliance with the relevant laws. How does a court do this? Through probate. Part of the probate process involves the court reviewing a will made by a deceased person to determine if it is valid. In other words, every will has to be probated in order for it to have any kind of legal effect.
Myth 3. Probate will take forever, and will cost my estate a lot of money.
While every probate case is different, the average case will usually last about 9 to 18 months. This is a long time, and if there are any legal problems that arise, probate could last even longer. The more time involved in probate, the more expensive the process tends to be.
Fortunately, probate isn’t always absolutely necessary. There are steps you can take to create an estate that will largely, if not completely, avoid the necessity of having to go through probate. To do this, however, you’ll need to create an estate plan that’s focused on probate avoidance.