Calculator and financial recordsThe Probate Court System is less formal and less complicated than the Superior Court System.  Nonetheless, the proper administration of an estate requires a detailed accounting of the estate’s transactions and the filing of several complicated tax forms.  An executor or executrix can undertake the estate administration individually; however, for larger estates or for estates where there are numerous beneficiaries, or if the accounting tasks are overwhelming, hiring an attorney to handle the administration is preferable.

If you are named as an executor or executrix of an estate, the first order of business would be the submission of the will to the probate court in whose jurisdiction the decedent resided.  The will should be hand delivered to avoid any problems with the mail. Some probate courts require an Application for Submission of the will and a Court Memorandum which need to be completed and filed simultaneously with the will.  A family tree naming the closest living relatives of the decedent would need to be prepared. Addresses of these living relatives need to be provided so that all of the heirs at law are provided with notice.

The probate court will set up a hearing to determine the acceptability of the will for probate.  If there are only a small number of beneficiaries, these beneficiaries can sign a waiver of the hearing on the will.  This enables the court to issue the fiduciary certificates upon the receipt of the Application for Submission of the will.  Again, all beneficiaries need to sign the waiver form. If a hearing is necessary, the court will review the will to determine if it has been executed according to law and to determine if a fiduciary bond is necessary.  Once accepted, the court will issue the fiduciary certificates.

Upon the issuance of the fiduciary certificates, the executor or executrix has the power to act on behalf of the estate.  He or she must make an inventory of the assets of the estate. The Inventory form must be filled out using date of death values for all assets.   Banks and/or stock brokers have to be contacted to determine exact values on the specified date. The internet can also be used to determine stock values.  Real property needs to be appraised. Blue book values can be used for automobiles. Personal possessions can also be appraised or an estimation provided for common place personalty.  Once all items are valued, the Inventory form must be filed with the probate court.

If there is real estate involved, the fiduciary must seek permission from the probate court to sell the realty unless the will explicitly provides the power to sell.  The probate court will also issue certain documents for filing on the land records.

All other items must be liquidated and placed in an interest bearing account.  From this account, expenses of the estate are paid. One of the most important expenses is the funeral bill which must be paid as soon as funds are available.  Income to the estate should be deposited into the account. Income items generally include stock dividends, interest, and refunds for various items such as medical insurance premiums.

A list of expenses owed by the decedent at the time of his/her death must be filed with the probate court.  This filing is known as the Return and List of Claims. Expenses incurred by the estate after the decedent’s death, i.e. the funeral bill, are not included on this document, however, they are accounted for on the final estate accounting.

After the Inventory and the Return and List of Claims have been filed, the succession tax return should be prepared.  An accountant should prepare the return if the fiduciary has limited knowledge of the tax form. An S-1 is filed if the estate will owe succession taxes.  An S-2 will be used if no tax is due. The filing must be made within 6 months of the date of death.

Once items are liquidated or ready for disbursement, the executor or executrix can begin to disburse the funds to the beneficiaries. Detailed records of the disbursements should be kept.

After the succession tax return is filed and all assets are ready for disbursement, a final accounting can be filed by the fiduciary.  The original inventory is the starting point for the final accounting. To the inventory value is added all of the income received by the estate.  The sum of the inventory plus the income must be equal to the sum of the Return and List of claims plus the expenses paid plus the previously made distributions plus the value of the remaining estate for distribution.  Once the final accounting is prepared, the probate court will set up a final hearing to accept or reject the accounting. Upon the acceptance of the final accounting, the final distributions can be made.

The executor or executrix will also be required to file an income tax return for the income earned by the decedent for the last tax year and an income tax return for the estate for income earned by the estate during the last tax year. Again an accountant can be hired to prepare these tax filings if the fiduciary is not familiar with the forms.

If you have the responsibility of administering an estate, you should contact LeFoll & LeFoll for a free initial consultation concerning the general probate process.  At the consultation, you can decide which of these items you, as fiduciary, will undertake and which will be the responsibility of the law firm. Please note that even if you hire LeFoll & LeFoll to prepare all of these filings, you, as fiduciary, would still be signing each of the documents and participating in the overall process.

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