Estate Planning & Probate Avoidance by Your Estate Attorneys, Lawyers delivering peace of mind to clients through education and preparation from a Christian perspective
WHAT IS PROBATE?
Probate and estate administration is the process of settling an estate after a person dies. It is necessary to pass title from the deceased to a beneficiary, and can often become both lengthy and costly. In fact, even though probate in Texas is easier than probate in other states, it is something that you may nevertheless want to avoid altogether. The best way to avoid complicated probate and estate administration is through comprehensive estate planning. At the Law Office of David C. Brunell, we represent personal representatives, family members, and beneficiaries during probate, will contests, and estate administration. Our firm can advise clients about the most efficient way to avoid and/or settle disputes related to an estate. To learn more about probate and estate administration, contact us
WHAT YOU SHOULD KNOW:
Probate is a legal process which is used to wind up a person’s legal and financial affairs after their death. Probate can be commenced with a will or without. The probate court will appoint a personal representative to perform the many required functions, including locating heirs, locating, gathering and securing assets, identifying creditors, negotiating debts, paying taxes and required debts, accounting to the probate court and ultimately distributing all remaining assets to the appropriate heirs. The probate process allows the legal transfer of assets to rightful heirs. This process is expensive, (estimated to be 3% to 8% of the deceased’s gross estate). A typical probate estate can take from six months to several years to complete.
Trust administration
One of the most common misconceptions in estate planning is that a Living Trust does not require administration after death. When a person or persons who created a trust dies certain steps must be taken to comply with State law and change title to the assets. The complexity of trust administration depends upon the number of beneficiaries, value of the trust assets, the type of trust assets, how trust assets are held and whether the trust includes tax planning provisions. A successor trustee is considered a fiduciary with legal obligations to protect and mange trust assets for the benefit of beneficiaries.
WHY AVOID PROBATE?
It seems Probate is something every estate owner wants to avoid at any cost. Yet most of us are not sure why. Unless you've been the personal representative for someone else's estate, it's a process you won't have to go through... but your loved ones might have to.
- Identifies and catalogs all of your property
- IAppraises the property, and pays all debts and taxes
- IProves that your will is valid and legal
- IDistributes the property to your heirs as the will instructs.
SOME REASONS TO CONSIDER:
Costly
Probate is not cheap or quick. Because probate requires a hearing in over-burdened courts, the process can tie up your property for a year or more. That means your loved ones will not get the property you intended for them until the probate process is complete.
In addition, probate is very expensive. Probate is usually handled by estate attorneys, who sometimes charge a flat percentage or a high hourly rate. Their fees and court costs can eat up 2-4% of your estate's value.
Not the Kind of Publicity You Want
The courts, by their very nature, do not afford privacy. Everything that comes before a judge is public record, as is true with your estate. A will is a very personal document, and may reveal private family and financial issues and concerns. But once it is entered into the court record, it becomes public, and can be inspected by anyone.
The Lawyers, Not Your Family, Are the Winners
Many lawyers don't explain fully the probate process when preparing your will, because probate usually represents a nice profit for them with little effort. To do probate, attorneys often charge as much as permitted by law, but most of the probate work is actually clerical and can be accomplished by paralegals and clerks.
On a $500,000 estate, probate attorney fees could easily reach $20,000, not including court costs and other expenses. And unfortunately, you're no longer around to do anything about it.
Is Your Estate Liquid?
Because probate costs can add up quickly, even before a single distribution to heirs is made, the estate must pay for these costs. However, if your estate consists of many illiquid assets, such as real property, art, coins, or long-term bonds, these assets will have to be sold to pay for probate. Selling these types of items involves appraisal fees and additional delays, not to mention the fact that property you may have intended for children may be sold at below-market value to pay for probate.
Avoid Probate Altogether
Living trusts allow you to avoid probate completely. When you set up a living trust, the trust is considered separate and apart from you. If you fund a trust, the trust (not you) owns your property. Therefore, the trust can continue even when you pass way.
The probate courts have no jurisdiction over property owned by a living trust. After your death, property in the trust can be distributed -- privately and easily -- to family or friends with no probate. Another option is to name your heirs as beneficiaries on certain retirement accounts, life insurance and annuities. When you name a beneficiary on these types of accounts, the proceeds from the account are distributed on the owner's death immediately to the named individual(s). Again, the courts have no jurisdiction over these types of distributions.
Avoid Probate by Gifting
Another way to reduce or eliminate probate is by simply giving your money away. Under current tax law, Uncle Sam allows you to give away up to $12,000 per individual each year. That means that a couple can give up to $24,000 per year to each child, grandchild, niece, nephew or friend. Lifetime gifting reduces your taxable estate, and may place your estate under the probate threshold for your particular state.
In no uncertain terms, probate can be an ugly process. To reduce or eliminate probate, our probate experts can help you review your options.
HOW WE CAN HELP
Few people understand how complex the laws governing estates can be. Most estates land in probate proceedings, which are public, expensive and time consuming. All too often the State decides the fate of a loved ones assets. When an estate is to be passed on to beneficiaries, it is vital to avoid complications through proper estate administration. A seasoned attorney can help you minimize frustration, reduce stress and prevent unnecessary legal fees. We are ready to assist you, call us at 734 466-9277
Probate and litigation is difficult to avoid if you have a poorly crafted estate plan. Yet, sometimes even the most comprehensive estate plan may still result in a contested will. We represent people during the probate process and during any disputes regarding the disposition of the estate. Our firm provides effective representation in disputes involving:
- Fiduciary duties
- Will contests
- Allegations of undue influence
- Questions about capacity
- Estate Administration
Estate administration is the process of collecting the property of an estate, paying off all estate debts and taxes, and distributing the remaining property to the estate's beneficiaries. An estate may go through either formal or informal probate. Formal probate is more costly, but is required in certain situations. Informal probate, on the other hand is faster, and more appropriate for simple estates. We can advise executors and personal representatives about all of their obligations during the administration of an estate. If you have questions about estate administration and/or the probate process, contact us.
- Estate administration
- Trust administration
- Name Change
- Guardianship
- Conservatorship
- Probate litigation