For “small estates,” almost every state now has expedited probate procedures or a chance to avoid it entirely. These transfer processes transfer the estate to inheritors more quickly than the conventional probate process. Each state defines small differently. It might shock you that even a small estate can include a considerable amount of property. It just depends on the probate laws in your state. Even reasonably large estates, valued even hundreds of thousands of dollars, may still be eligible for certain probate shortcuts because some states exclude specific types of property when calculating the size of the estate.
For small estates, there are two main types of probate shortcuts:
- Affidavit processes, which let you claim property by merely making a sworn statement, and
- Streamlined court procedures
Your beneficiaries may be able to avoid probate altogether if the combined worth of all the assets you leave behind is less than a specific threshold. An affidavit is a sworn document that your inheritors use to acquire property instead. Your state’s law—which differs significantly from state to state—will determine how little of your assets must be worthless for your inheritors to use this affidavit approach.
This process is only possible for personal property—i.e., any property other than real estate—in specific states. However, using a second affidavit, you can claim real estate worth less than a particular amount in some areas.
A quicker, more accessible type of probate provides an additional choice for small estates (again, as determined by state law). The probate court has much less influence on how the estate is settled. The inheritors don’t have to wait as long because the property passes through probate more quicker. These processes save time and money since they are frequently simple enough to handle without an attorney.
You probably assume that the straightforward “small estates” procedures won’t be helpful to your inheritors if you anticipate leaving a sizable amount of assets to your loved ones. Wait a minute. The inheritors of your estate may still benefit from the simplified processes, which allow families to avoid probate court entirely or go through a significantly shortened probate process, even if the value of your estate is substantially more significant than the limit set by your state.
The reason is that many states remove sizable portions of assets when calculating the worth of your estate to determine whether it is under the dollar threshold. So, for example, in some states, a $500,000 estate might be eligible for “small estate” procedures.
Process of Small Estate Administration
The process of administering a small estate often starts with the person seeking the relevant probate court to accept a will. Typically, the executor is the one who carries out this directive. An adult heir may request the opening of a probate proceeding if there is no will. The term heir refers to a person legally eligible to inherit under intestacy laws. The case occasionally is opened for creditors. The probate court is located in the county where the decedent had a lawful domicile before passing away.
The case may need to wait for a specific amount before it can be opened. For instance, the small estate process in Tennessee begins 45 days after the decedent’s passing. Likewise, a minor estate administration can only start if there are no testamentary or administration letters on file with the state.
The court petition might have to contain certain information mandated by state law, such as whether the decedent had a will, whether there are any unpaid debts, a list of outstanding debts and information about the creditor, an itemized list of the property the decedent owned, insurance information related to the decedent, the current person or entity in possession of the property, a list of heirs at law or beneficiaries, and so on.
The will presented to the court must typically be the original. Usually, the petitioner must certify the facts stated in the petition by signing under penalty of perjury. Additionally, you must pay the court’s filing cost. Finally, petitioners must inform specific people and organizations that they have filed a petition. A bond may be required by the court, though it is waived.
An individual may own an estate not subject to the probate process. As an illustration, a person may hold property as joint tenants with the right of survivorship. It avoids probate because the surviving owner takes over the other owner’s interest. Beneficiary designations on retirement funds and life insurance policies are also exempt from probate. However, the state law governing the administration of minor estates may restrict what constitutes the decedent’s property. As a result, it could lower the total worth of the estate.