One of the common questions I get is “Do I need Probate when someone dies?” There is also the question “What is Probate?”
When someone dies, there is a flood of emotions. In addition, there is concern regarding what needs to happen, worry about things to do, and confusion.
In my upcoming eBook “What to Do When Someone Dies,” I breakdown the logistical things to do in the immediate, then weeks, and months after a person’s passing. The first thing to do is very little. The funeral is enough to work through both emotionally and time-wise.
When it is time to begin the evaluation, the decedent’s property is reviewed. We look at
- What was owned,
- How was it owned, and
- What is the value less secured purchase money and mortgages.
In Indiana, if the total property value is greater than $50,000, Probate becomes a possibility. We apply some expenses called Administrative Expenses to the value, which may put the estate value below the $50,000 threshold. However, if value remains greater than $50,000, the Probate Court should be involved. (Read more about specifics of Probate)
So, the estate value answers the question “Do I need Probate?”.
What is Probate?
So, we understand what triggers a need for Probate. But, what is the process.
Probate involves a process of:
- Gathering assets and property owned by the decedent,
- Inventorying the property and values as of the date of death,
- Reporting inventory information to the Court and distributees,
- Determining creditors and the type of claim they have,
- Providing proper notice,
- Prioritizing the distribution of expenses, claims, and distributions,
- Preparing, gaining approval, and submitting final accounting to appropriate parties, and
- Closing the estate.
Seems pretty straightforward. The process allows the State to protect the interests of the various parties with claims or interest in the estate. The process, defined in Indiana Code, sets the priority. Secured interest such as mortgages and loans for the purchase of property get paid first as those items as the estate sells them. Expenses and fees defined as “Administration” or “Administrative” have the first position for payment from estate property.