Probate is the process wherein a court approves the distribution of an estate. It can be a long, complicated series of court proceedings that, if done incorrectly, can create considerable headaches for the people involved. In probate, the following generally occurs:
- Notice to all heirs is made.
- A petition for personal representative is made to the Court.
- Assets are inventoried and appraised.
- Payments are approved to be made to creditors.
- Certain assets of the estate are sold.
- Estate taxes are paid, if any.
- Heirs receive their final distributions.
What makes up the Probate Estate?
The probate estate is made up of essentially anything that passes by will. This can include, for example, real estate, bank and investment accounts, stocks and bonds, and vehicles. Non-probate assets can include the following:
- Assets owned in joint tenancy with a right of survivorship
- Property or accounts that are “payable-on-death” or “transfer-on-death”
- Life insurance which designates a beneficiary other than the estate
- Retirement assets which designate a beneficiary other than the estate
If an asset is in a living trust then it can avoid probate and remain in the trust after death.
Formal v. Informal Probate
In Minnesota, there are two kinds of probate: Formal and Informal. Formal (supervised) probate is where the estate is administered in Court proceedings. It tends to be more costly, both in time and money. Formal probate can take anywhere between 6 and 24 months or more, depending on the complexity of the estate. A judge oversees the estate disposition, so if there is potential for a dispute, then formal probate may be the way to go.
In informal (unsupervised) probate, a court administrator oversees the disposition of the estate. The designated personal representative can make distributions to creditors and heirs without approval of the court. An informal probate starts with filing a petition. Reasons that informal probate may be rejected and force the estate to go through formal probate include, for example:
- The estate is insolvent.
- The original will cannot be found.
- There are unknown heirs to the estate.
- There is disagreement among the heirs or beneficiaries.
- The interests of vulnerable parties need protection. This includes minors, persons with certain special needs, and creditors.
- The estate is overly complex.
- A descendant is disinherited
Signature Law's Approach
Signature Law's approach to probate is to make it as efficient, economical, and fast as possible. Probate in Minnesota is not like probate in New York or California – there is no reason a normal probate needs to cost tens of thousands of dollars. We keep it reasonable, and keep you informed every step of the way what is going on. One caveat to this is that Signature Law does not do contested probates: if you are challenging a will or expect there to be a challenge to a will, we have attorneys that we can recommend you work with who are excellent at what they do.
Probate is a complicated process which generally requires attorney representation. If you have any questions about the probate process, please contact Signature Law for a free consultation.