This column presents general information regarding estate and disability planning and probate. It is not intended to create an attorney-client relationship or constitute legal advice to readers. Individuals with legal concerns should consult with an attorney for advice regarding their specific circumstances.
Unfortunately, there are two things in life that are certain – death and taxes. Most of us would prefer not to think about either until the time comes. Though, at least with taxes, it is the same time every year. With death, on the other hand, it can be sudden. And, regardless of whether someone had been sick for a while or they suffered an unexpected injury, it is an emotional time for the survivors. The last thing someone wants to deal with after the death of a loved one, is the probate process.
But, probate does not have to be complicated. Simply put, it is the legal process of proving the decedent’s will is valid and identifying and distributing the decedent’s assets in accordance with their will. To start the process, the personal representative – sometimes referred to as the executor in other states, named in the will must take the original will, along with a certified copy of the death certificate, to the Register of Wills’ office in the county where the decedent resided at death.
Next, the personal representative will fill out and file a petition to be appointed the personal representative of the estate. The personal representative will pay a bond premium, usually nominal, and publish a notice to creditors and unknown heirs in a newspaper of general circulation within the county where the estate is being probated. Generally, creditors will have six months from the date of death to file a claim against the estate. If any creditor fails to file a claim within the time limit, their claim is forever barred and does not have to be paid.
Once the probate estate is opened, the personal representative will have to obtain an estate identification number from the Internal Revenue Service and open an estate bank account. Additionally, the personal representative will have to gather the estate assets and report on an Inventory the date of death values of those assets. This may require the personal representative to obtain appraisals of any real property and/or tangible personal property in the home.
The Inventory is due within three months of the personal representative’s appointment. Also, the personal representative will be required to file an Information Report that identifies any assets that may have passed outside of probate due to joint ownership, a beneficiary designation, or a trust, to anyone who is not exempt from inheritance taxes. The Information Report also lists any assets that may be located outside the State of Maryland. If there are assets located in another state, an ancillary probate estate may need to be opened.
Finally, a first Account will be due nine months from the date of the personal representative’s appointment and thereafter, every six months until the estate is closed. The Account will list all receipts and expenses from the estate during the accounting period. Such expenses will include a probate fee paid from estate assets to the Register of Wills. This fee is based on the value of the gross probate estate. The final Account will show a final distribution to the named beneficiaries in the Will. The estate cannot be closed until all assets have been accounted for and distributed.
So, what happens if the decedent did not have a will? It is still the same process, except the State’s intestacy rules will apply. In that case, there is a statute that gives priority to a spouse and the decedent’s children to act as the personal representative; however, if there is a disagreement among them as to who will be the personal representative, the court will schedule a hearing to determine the best person to act. Similarly, there is a statute that indicates how the decedent’s assets will be distributed.
Thus, unpleasant as it may be, it is important to think about who you want to administer your estate and to whom you want your assets distributed after you pass. Making a will now assures that you will be in charge and that everything that is important to you will be distributed in accordance with your wishes, not in accordance with the State’s rules. Not only will you have peace of mind, but your loved ones will appreciate not having to guess what you would have wanted.
Jessica L. Estes is an elder law and estate planning attorney at ERA Law Group, LLC in Annapolis. She can be reached at (410) 919-1790 or via email at [email protected].
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