A Probate Attorney Weighs In: What Happens to Investment Accounts During Probate?
When a person dies, their estate is usually left without administration. When the probate attorney takes over the administration of the estate, then the estate is said to be in probate. The administration involves organizing the estate, paying taxes, and clearing any debts the deceased had. In case of a will, the named will take charge of the estates.
First of all, whether an account goes to probate or not depends on two things. That is whether there has been a Transfer on Death designation or there are no beneficiaries listed. If there is no Transfer on Death designated or there is an issue with the beneficiary in the will, the account will be in probate. But, on the other hand, if the designated beneficiary has been named, the person takes full authority of the account, and everything else will be distributed according to the will. So, it is easier to name the beneficiaries to make the transfer on death easier and inexpensive to them.
If the beneficiary is not ready or cannot manage the investment account, you can place the account in a trust. You can also hire a professional to manage the account for them.
How Does the Probate Process Work?
Probate can work differently depending on the case at hand. This is because different people leave different instructions for distributing their wealth. This process becomes even more difficult if there are disputes of the estate left. The conflicts may be between the beneficiaries, the creditors, and the executor.
The process an executor takes follows these steps:
• The executor gathers all the information required on the estate. This information may include the size of the estate and any debts connected to it.
• Then they apply for permission to take control of the assets and distribute the inheritance according to the deceased’s wishes.
• Then any inheritance tax on the property is paid together with any taxes due.
• The grand on probate applied in step two is then issued to the executor to continue the process duly.
• If any debt is left by the deceases, they are paid off first.
• Finally, the remaining estate is distributed to the beneficiaries according to the deceased wishes.
This can be a straightforward process if all things are in order. However, it can take up to a year to be finalized. The process also depends on the size of the estate and whether there are any difficulties with dealing with it. One major complication may come from misunderstandings between the executor, beneficiaries, creditors, and the taxman. The longer the disputes take, the longer the probate.
How Much Does Probate Cost?
Probate usually takes a certain amount of time since it involves proving the worthiness of a will or resolving any challenges to it. When in probate, you deal with probate attorneys. The assets are frozen during the probate process until the courts decide. Therefore, considering the probate process takes up to an average of a year to be entirely done with, it can take a total cost of 3% to 7% of the entire value of the property. Of course, this all depends on the length of the probate and what your probate lawyer charges.
Who Can Apply for Probate?
Only an executor can apply for probate. AN executor is usually named in the deceased’s will to undertake this exercise. If you are the executor, you can contact a law firm such as Sean M. Tank to apply probate on your behalf if you do not want to participate in the administration. If your loved one dies without a will, the intestacy rules apply, and someone will be chosen to apply for probate. The state of dying without a will is called intestate.
Can One Change a Will?
Yes, you can change a will someone has left behind, but only to the portion that has been allocated to you. You will, however, be required to apply for a deed of variation to take this task on. However, there is a difference between changing and challenging a will. You can challenge a will in different circumstances. For example, if you deem the will has been forged. Forgery of wills is also possible, especially if you feel the distribution does not reflect the deceased’s intentions.
Another instance is whether the deceased was mentally okay when writing the will. This is a significant factor and is usually taken seriously. If the deceased was also under the influence when writing the document, you could challenge it in the court of law. Also, if you depended on the deceased financially and nothing has been left under your name, you could challenge it under the law as it is cluttered in the Inheritance act. Therefore, challenging and changing a will is not impossible if you have a valid reason and enough evidence to pursue it.
Rights of the Beneficiaries During Probate
The beneficiaries should always be well informed throughout the probate process. Any information should not be withheld from them. They can sue the executor if they feel their rights have been breached. They can also sue the executor in case they mismanage the estate.
The beneficiaries also have the right to know of any accounting on the estate and its value without error. They are usually in the will, and if a will is not left behind, they are chosen according to intestacy rules. You are also allowed only to view the will when the grant of probate is issued. However, most executors show the beneficiaries the documents when requested.
When to Get Help From a Probate Attorney
Lack of a well-written will could lead to losing part of your estate to the state, leaving very little to your beneficiaries. It’s important to appoint someone to take care of your estate and handle the probate process to make sure you do not lose your assets to the state. By making these plans in advance, you can be rest assured that your beneficiaries will receive the assets as you intended and be well taken care of after you’re gone. Making these plans for your loved ones could be one of the best gifts you can give them, and you’ll have peace of mind as well.
