Understanding the Probate Process and the Duties of the Executor

May 8, 2012 in Investing In Real Estate, Probates/ Probate Investing

 

probate investing

Just about everyone will tell you that the probate process is difficult.  It can be confusing to navigate, and emotionally it is a tough job for those left behind.  In a perfect world, each of us would have done careful estate planning to make things easier for family members. However, in real life this is often not the case. Here is a little “cheat sheet” to help you understand the process.  

 

What is probate?

It a nutshell, probate is the legal process by which the assets are distributed, debts and taxes owed are paid, and everything is overseen legally.

 

Types of Probate Estates; Testate and Intestate

Intestate

When a person dies without a will the estate is Intestate. In this case, state laws determine who is entitled to the estate, and who the court appoints as the personal representative. The personal representative will manage the probate process.

Testate

If the deceased leaves a will, the will states how the assets will be divided and it also names an executor who will manage the probate process.

One difference between a Testate estate and an Intestate estate are the rules that apply to surety bonds. A person can leave instructions in the will waving the executor’s requirement to purchase a surety bond.  However, the option to wave the surety bond where there is no valid will is not available in some states.

 

Are the duties of an executor different than a personal representative?

No. The personal representative that was appointed by the court has the same duties and responsibilities as an executor named in a will.

 

What are the duties of the executor/personal representative?

The duties of the executor include:

  • Initiating the probate process with an attorney or at the local courthouse.
  • Notifying the beneficiaries in the will.

Many times an attorney will take care of this.  If individual items have been willed to beneficiaries, it is the executor’s responsibility to see that they receive them.

  • Notifying banks, utility companies, insurance companies and anyone else the deceased had a business relationship with.
  • Creditors must be notified about the death.
  • Executors must take inventory of the assets, and they are responsible for appraising the personal assets, real estate and bank accounts.
  • Federal, State and Estate Taxes must be filed by the executor.

If you are planning to work in the niche of probates, I believe that you should understand the probate process and the duties of the executor or personal representative. Having this basic knowledge will only solidify your “probate expert” status.

 

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