You may have prepared and signed your Last Will and Testament directing who receives your property at your death, but do you know how your property will get transferred after your death?
As discussed in So You Have A Last Will and Testament, Now What?, some of your assets may transfer automatically to your beneficiaries via a variety of designations (ex: payable on death or transfer on death designations on financial accounts), so it is usually important that your beneficiary designations reflect your directions in your Last Will. But what about the property that doesn’t automatically transfer to beneficiaries?
It depends, but the personal representative you nominated in your Last Will may have to open a probate to transfer your property. A probate is a legal, court-supervised process by which your personal representative receives legal authority to transfer your assets as you’ve directed in your Last Will.
Generally, your personal representative will file an application to open a probate and be appointed personal representative with the district court in the county where you resided at the time of your death. The court may then order and authorize the personal representative to perform the duties necessary to administer your estate. The personal representative may also need to give notice of your death, and the resulting probate, to your creditors, and to your heirs and any individuals or organizations who you’ve named in your Last Will to receive your assets.
Your personal representative will prepare an inventory of your assets, including the value of your assets; this inventory is provided to your heirs and any individuals or organizations named in your Last Will. Your personal representative will then work to liquidate your assets, if necessary, pay your final bills and taxes, resolve any creditor claims, and then distribute your assets by transferring legal title to individuals or organizations as directed in your Last Will. To close the probate proceeding, the personal representative provides a full accounting of your estate to your heirs and anyone who received property from your estate, and then files a sworn statement to close the estate with the court, attesting to the court that he/she has properly administered and distributed your estate. Most of the time, your personal representative will never have to appear in court at a hearing.
Usually, a probate generally has to be open for at least six months, but a simplified process may be available to your personal representative depending on the nature and value of your assets. Alternatively, a probate may become more complicated if someone challenges your Last Will, if there are creditor issues that can’t be resolved, or if there are issues with distributing your assets.
If you don’t have a Last Will, a probate may still be necessary to transfer your assets. In this case, Montana law identifies who is eligible to act as your personal representative and who will receive your property.
Finally, in addition to naming beneficiaries, there are other methods of titling your assets that may help avoid probate, such as joint ownership and trusts.
Contact an estate planning attorney at Worden Thane today to discuss whether a probate is necessary for your, or a loved one’s, estate, or if you need help with a new or existing probate.