Probate property refers to the property owned by a person who has died. Probate is the process by which that property is divided amongst persons entitled to it, and taxes and any other expenses incurred are paid. The owner of the property who has died is referred to as the Decedent. The Decedent’s probate property includes any property that is titled in his or her name which does not automatically transfer at death. Examples of probate property are real property, personal tangible property, and intangible property. The probate process seeks to divide this property according to the interests of the decedent.
Is Probate Required and What is Involved?
The person in charge of controlling and managing the estate and its assets is known as the Executor. Executors are typically named in the will. If there is no will or the will does not name an Executor, the court will likely appoint an Executor or Administrator of the estate. This person or party is responsible for many tasks, including managing the finances on behalf of the estate, investigating and defending against claims against the estate, filing taxes on behalf of the estate, and distributing the assets of the estate.
The rule of thumb is that the larger the estate, the greater the need for probate. Probate would likely not be necessary if all the Decedent’s property is designed to transfer without probate. Such non-probate assets may include real or personal property with a “payable on death” or “transfer on death” designation. Otherwise, probate is necessary to give the Executor or Administrator of the estate the authority that they need to manage the estate effectively. Probate is also likely necessary in instances where there are outstanding debts or taxes owed by the estate.
Do I Need a Will or Can the Probate Court Handle My Estate for Me?
Many people ask “Do I need an Estate Plan?” The answer is that every resident of Ohio has an estate plan. If you have not created your own estate plan, the state of Ohio has created one for you. A will is the most common tool used in estate planning. A will helps provide peace of mind that your property will be divided as you wish. Wills may include guidelines for how and to who property is distributed. They will also name the Executor of the estate – the person who is in charge of managing your estate. Because your desires for what happens with your estate after death may change, you can always change and update your will to reflect such changes.
Aside from allocating your property and choosing your Executor, wills have other significant benefits. A will can allow you to nominate a Guardian for minor children or designate a new owner for your pets. Ultimately, wills are relatively inexpensive in comparison to the benefit they generate. It is highly recommended that all adults over the age of 18 have a will.
What is Excluded from Probate?
When planning your estate, it is important to differentiate what is and is not probate property. Non-probate property can include things the decedent owned in conjunction with another person. This occurs when a real or personal property is titled in more than one person’s name, as often happens with land, houses, cars, or bank accounts. The law often refers to this as property owned as “joint tenants with right of survivorship.” Non-probate property can also include assets held in a trust, accounts that are paid or transferred at death to a beneficiary, and some types of benefits or insurance. These types of property or assets transfer automatically, so probate proceedings are likely not necessary. Non-probate property will still likely be subject to state or federal taxes.
When planning your estate, it is important to understand the difference between probate and non-probate property, as this could affect the division of your estate. For example, parties may intend to transfer an asset by will, but later place that same asset in a bank with a different person named as a joint holder of the account. Because of this, the contents of the account would pass to the party named on the account, not the party named in the will as was the Decedent’s intent. Thus, failure to understand the difference between probate and non-probate property is important, and failure to do so can have serious consequences for your estate.
Isn’t Probate Expensive and Time-Consuming?
The quick answer is: it depends. Estate planning is often much more affordable and much quicker than people realize. Depending on the complexity of your estate, our attorneys can create a comprehensive estate plan for you in as little as a few days.
Probate, however, typically refers to the time after the Decedent has passed away, and the Executor or Administrator is handling the estate. For small estates, the probate process can be completed usually within around six months of the appointment of the executor or administrator. In some situations, however, it can last more than a year. Creditor claims against the estate may be made up to six months from the date of death of the Decedent. Therefore, once six months from the date of death passes, the Executor, Administrator, and Beneficiaries should have a much better idea regarding whether the probate process will be extended by litigation.
The cost of probate in Ohio varies widely but is usually about 5-10% of the value of the estate. How much the probate process will cost depends on the length of time required to complete the process and the cooperativeness of the parties involved. The longer the probate process lasts, and the more complicated it is, the more expensive it will be. The estate also must pay filing fees and court costs, but this is typically relatively inexpensive.
Need help with your estate plan? The attorneys at Katz, Pryor & DiCuccio, LLP can help, and the initial consultation is always free. Please contact us at (614) 363-3500 or firstname.lastname@example.org to schedule your free consultation now.
This article or any communication made through this website is for general information purposes only. Nothing conveyed through this article or website should be taken as legal advice and under no circumstances constitutes an attorney-client relationship.