When Does an Estate Have to Be Probated?

A not so uncommon question that estate planning attorneys are asked is “When is probate really required?” Like a lot of estate planning questions, the answer is subject on the particular laws of the state where you reside at the time of your passing, in addition the laws of any other state where you’re the real estate owner.

According to NayLaw, “Probate is required only when there is no other mechanism by which to transfer the asset to the heirs or devisees of the estate. When the decedent has taken other steps for distributing assets, a probate may not be necessary.”

The following is a list of the grounds why an estate would be required to be probated.

Assets Owned Solely in the Deceased Name

When the deceased solely owned a property without joint owners or a POD designation, probate is often required. There’s an exception for automobiles in some states like Florida and Tennessee, allowing direct transfer to heirs without probate. Additionally, many states offer a streamlined process for “small estates,” typically valued at $75,000 or less in Florida, making it quicker than a full probate.

Owner of Assets as a Tenant in Common

In many cases, when the deceased co-owned property as a tenancy in common, probate is needed for their share to pass to beneficiaries. The “small estate” method applies if the share is valued below the state’s limit. However, if the tenancy in common was transferred to the deceased’s Revocable Living Trust before their death, probate may not be necessary.

Predeceased Beneficiaries or No Designated Beneficiaries

In cases where the deceased owned accounts like POD, Health Savings, life insurance, or retirement, and beneficiaries predeceased or were not designated, probate may be necessary. The “small estate” approach applies when the account value falls below the state’s limit.

The Decedent Did Not Have a Legal Last Will and Testament

When there’s no valid will, and certain conditions apply to the deceased’s assets, probate is often necessary to transfer them to the heirs. The “small estate” method applies to an intestate estate if the property’s value is below the state’s limit.

The Deceased Has a Legal Last Will and Testament

Even with a valid will, if certain situations apply to the deceased’s assets, probate may be necessary to transfer them to the designated beneficiaries. The “small estate” method applies if the property’s value falls below the state’s limit, even in a testate estate.

Source:

Garber, J. (2020, September 25). Do You Know When Probating a Will Is Necessary? Retrieved December 22, 2020, from https://www.thebalance.com/when-is-probate-necessary-3505265