When someone dies, it is usually necessary to "probate" the decedent's estate. Probating the estate involves clearing up ownership of a decedent's assets, paying any outstanding debts, paying funeral and burial expenses, and paying taxes and the expenses of administering the estate. If the decedent owned real estate in Massachusetts, a Massachusetts estate tax return may have to filed in order to obtain a release of the automatic estate tax lien on the real estate, even though no estate tax may be due. For more substantial estates, a federal estate tax return may also be due. (The present federal estate tax "kicks in" when a decedent's estate is over $5,340,000, the estimated amount for 2014. Additional planning opportunities exist for couples.) In the alternative, the executor or administration may have to file an affidavit of no tax due. Assets are then distributed to the beneficiaries named in the will.
Probate varies according to state law (and even by county within a state). We probate estates in Massachusetts and New Hampshire, and are also licensed in Maryland.
Some assets may not pass according to will. Assets which are jointly titled, or held in forms of ownership with others, or subject to a "pay on death" or beneficiary provision, including life insurance, certain retirement assets, and Individual Retirement Accounts, do not generally pass through probate, though they can affect the amount, if any, of estate taxes due. Assets held in a trust with a survivorship or beneficiary provision prior to death may also avoid the probate process (as such a trust or provision is intended to do). However, in some circumstances, such property may be subject to administration in the decedent's estate.
Currently, in Massachusetts, if the decedent left a will, the will is filed with the court, along with a death certificate normally within 30 days of death. If there are assets remaining in the decedent's name, the assets will be distributed according to the instructions in the will, after payment of the administration expenses, funeral expenses, taxes, and debts of the decedent, including last medical expenses. The assents of the next of kin will be sought to expedite the appointment of the Executor named in the will. A notice of the appointment will be published in the newspaper, to give creditors and anyone who might object to the will notice of the initiation of the probate process. Notice needs to be given to known, unpaid creditors. Notice is also given to the Department of Medical Assistance for recovery of Medicaid, the Veteran's Administration in some cases, and to the Attorney General's office if there is a charitable bequest in the will. After a brief intervening period for any objections to the will or proposed executor, and assuming no objections have been filed, the Executor is appointed and may begin administering the assets of the estate once his or her Bond is filed. He gives notice of his appointment to the beneficiaries named in the will. The Executor takes control of the assets of the estate, pays debts of the decedent and pays the funeral expenses and any outstanding taxes and administration expenses. Creditors of the decedent must file any claims they have within a timely period (within six months up to a year, depending upon the situation). After all the claims and expenses against the estate have been paid, the Executor distributes the assets according to the terms of the will. Upon completion of his duties, the Executor prepares and files his account with the court for allowance, usually with assents from each beneficiary. After publication of notice, and if there are no objections, the court will allow the account and discharge the Executor.
For small estates in Massachusetts, Voluntary Probate may be possible. This is a streamlined procedure for simple, solvent estates under $25,000 in value (exclusive of the value of any automobile and assuming the decedent didn't own real estate.). It is generally more rapid than normal probate.
If the decedent left assets in his or her name, but died without executing a valid will, the estate will be administered according to the laws of intestacy in Massachusetts, New Hampshire or where the property is located. It is similar to the situation described above, but statutory law determines how the remaining assets are distributed after all debts of the decedent and claims against the estate have been paid.
For smaller estates where the decedent died without leaving a will, Voluntary Administration may be possible. It is similar to Voluntary Probate but distributions are made according to law in the absence of a will.
If the decedent left property in other states, an ancillary administration will be necessary. An exemplified copy of the probate proceedings in Massachusetts or New Hampshire will have to be filed in the other state.
You may also wish to see our website www.wellesleyestateplanning.com for additional information concerning estate planning.