What is probate and should I try to avoid it?

What is probate?

When someone dies, probate is the legal process that includes:

  • Filing the deceased person's will with a local court
  • Having the will examined and proved valid to the court
  • Identifying and inventorying the deceased person's property
  • Having that property appraised
  • Paying off debts, and 
  • Distributing what's left of the property as the will directs.

If the deceased person didn't leave a will (or leave in the property in any other way such as through a living trust or joint tenancy) then the property is distributed through intestate succession. Intestate succession is essentially a state's pre-determined ranking system of who is entitled to a portion of the decedent's property.

For example, in Utah the surviving spouse is in first position, followed by the children and grandchildren (if any), then the parents (if no surviving children or grandchildren), then the siblings (if no surviving parents), then the grandparents (if no surviving siblings), then the cousins (if no surviving grandparents), and so on.

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Should I try to avoid probate?

Except in a few unique situations, avoiding probate will almost always save time and money. Probate can be costly as it requires filing fees and attorney fees (In Utah a probate lawyer is not required although doing it yourself can cause more problems than solutions). Probate can also take anywhere from a few months to a few years depending on the size of the estate and whether there are any disputes over the estate property.

For these reasons, many people plan to avoid probate. Probate can be avoided by using any of the following methods:

  • Revocable living trusts
  • Joint tenancy ownership
  • "Pay on death" designations
  • Life insurance
  • Retirement accounts that go to a beneficiary
  • Having an estate of less than $100,000 (Utah Code Ann. ยง 75-3-1201)

While there are many benefits to avoiding probate, probate proceedings may actually be a good idea in a few situations. For example, if the estate owes a lot of debt then a probate proceeding is simpler than defending several lawsuits. Likewise, if the deceased person owned a failing business, or was involved in complicated financial transactions or complex litigation, probate provides a ready-made court procedure for resolving creditors' claims faster than by normal lawsuits.

In sum, probate is generally a process that is beneficial to avoid. In order to do so, it is helpful to talk to an estate planning attorney to discuss the methods that would be the most appropriate for you. J.Cutler Law offers free consultations and can help answer any of your estate planning questions.