This blog was updated on September 24, 2020. The original blog was posted on April 7, 2018.
The passing of a loved one or friend, even if expected, is a traumatic experience. Adding to the tumult is the survivors’ tasks of assessing the decedents’ assets, liabilities, and obligations and figuring out what to do next. A tool to assist the survivors with sorting things out is probate. Simply put, probate is the court-supervised process of inventorying the decedent’s assets, prioritizing and paying the decedent’s proper debts, and re-titling and distributing assets to the decedent’s rightful heirs. Although many are convinced that “probate” is a four letter word due to the time and cost that is often associated with it, the probate process is crucial to resolving a decedent’s affairs, settling any disputes with the decedent’s creditors and heirs, and transferring title of his or her assets to their new owners.
Before delving into the probate process in detail, it is important to note that some assets of a decedent may not be subject to probate. Non-probate assets may include assets that pass by a beneficiary designation to a named beneficiary such as with a retirement account, annuity, or life insurance policy. Beneficiary-designated assets pass to the named beneficiary and outside of probate unless there is no beneficiary named, whereupon, the decedent’s estate can become the default beneficiary and probate is needed to claim and distribute such estate assets. Joint accounts and jointly titled real estate between married persons, both with explicitly stated rights of survivorship, will generally skip probate and pass automatically to the surviving joint owner. Bank and investment accounts that name payable, or transferable, on death payees can also skip probate and pass directly to the named payee. Finally, assets of a decedent titled in a trust as of his or her death are generally distributed outside of probate and pursuant to the terms of the trust, such as with a revocable living trust which is a common estate planning and probate avoidance tool. Please note that even if a decedent’s assets pass outside of probate and directly to heirs, they are, unless a state-specific or federal exemption applies, still subject to pay the decedent’s proper debts.
If a survivor determines that a probate is necessary due to the need to access and re-title a bank account, real estate or some other asset stuck in the decedent’s name, or to deal with the decedent’s heirs and/or creditors, the survivor will usually contact legal counsel to assist. The first legal document the survivor should review is the decedent’s Will. The Will usually directs who is to be in charge of the decedent’s probate estate and this person is called the executor or personal representative. The named executor has priority to serve in that capacity and he or she is charged with opening any probate. Please note that the naming of an executor in a Will, alone, does not empower the executor to do anything. Until a probate is opened with the probate court, the named executor lacks the legal authority to act and must wait for the probate court’s order authorizing the executor before proceeding to do the executor’s job. In the absence of a Will, state law provides a list of persons who have priority to serve as executor of the decedent’s estate.
In a typical probate (called an informal or formal probate depending upon how much court supervision is desired), the named executor contacts an attorney to assist with preparing and filing the probate paperwork, to provide the executor with legal advice as to how best to manage the probate, and to ultimately close the probate. A probate is filed in the county where the decedent resided. In Idaho, the fastest an informal or formal probate may be opened and closed is 6 months. While the probate is open, there is a 4 month notice and creditor claim period that takes place to flush out any creditors of the decedent. During the probate, the executor prepares an inventory and accounting of the decedent’s assets, assesses and pays just creditor claims, and liquidates and/or re-titles assets in preparation of closing the probate estate. Once all valid creditor claims are resolved and final tax returns filed and taxes paid, the estate can be closed and the estate assets distributed to the heirs. Legal counsel helps throughout the probate process.
In addition to the traditional probate process discussed above, Idaho and many other states offer other forms of probate that may be better-suited to address the survivors’ needs. A small estate affidavit is a statutory tool that may be used by a survivor in Idaho, and in lieu of a standard probate, to claim title to a decedent’s personal property (which may include titled vehicles) and certain bank and investment accounts. To use the affidavit, Idaho law requires, in pertinent part, that the total value of the net estate be less than $100,000, no probate be filed, the person making the affidavit is the rightful heir to the property claimed, and that any property of the decedent claimed through the affidavit is still subject to the decedent’s proper creditors. The small estate affidavit is most often used to claim title to vehicles and bank accounts in small estates. The small estate affidavit cannot be used to re-title a decedent’s real estate.
Please note that in regard to a decedent’s interest in real estate, there are some counties in Idaho that allow a surviving spouse to record, in the real property records of the county where the real estate is located, an affidavit stating, in part, that the survivor is the spouse of the decedent, the decedent died without a Will, the real estate was owned as community property, and if a probate was done of the decedent’s estate, all interest in the real estate would pass to the survivor. This is not the small estate affidavit. The Idaho laws upon which the county affidavit is based do not currently state that real estate may be re-titled to the survivor by such an affidavit. Although an Idaho county may recognize a title change to the surviving spouse based upon such an affidavit, the reader is advised to be cautious when relying upon this county-specific affidavit to re-title real estate. This county affidavit may not be recognized later on by a title company or third-party purchaser as a legal way to transfer title. For real estate, the best course to pursue is re-titling through a State-sanctioned probate method.
Another legitimate probate variation offered in Idaho and in many other states is a process known as summary probate administration for a surviving spouse. This is a limited probate process where a surviving spouse, entitled, by operation of the decedent’s Will or by state law if there is no Will, to his or her deceased spouse’s assets (including real estate), files with the probate court to have all assets of the decedent spouse re-titled to the surviving spouse and subject to the decedent’s debts, if any. The summary administration requires only that notice of the filing be provided to the decedent’s children and other interested parties and that a brief court hearing be held. The whole process can usually be completed in 4-8 weeks depending upon the probate court’s hearing calendar.
Probate in Idaho must generally be commenced within 3 years of the decedent’s death; however, the small estate affidavit and summary administration tools discussed above can be used anytime after death and are not limited to the 3 year rule. In cases where a full probate should have been initiated within the 3 years but was not, Idaho does provide alternative methods to get a decedent’s assets re-titled to his or her rightful heirs.
Probate is often a necessary and very beneficial method to resolve a decedent’s affairs and to re-title assets to heirs. Survivors should retain qualified legal counsel to assist them with navigating the probate process and choosing the probate options that will best serve their needs.