When a loved one passes away, the survivors are faced with grieving that loss. One of those survivors must also address the practical and legal consequences of the individual’s death. If you recently lost a loved one, and the decedent appointed you to be the Executor of the estate in his/her Last Wil and Testament, it is up to you to administer the estate. You may be wondering if you can avoid probate since the decedent left behind a Will. As you will learn, however, avoiding probate is not based on the presence or absence of a Will in North Dakota.
What Is Probate?
Probate is the legal process that is typically required after someone dies. Probate serves several important functions, including:
- Ensuring that the decedent’s assets are identified, located, secured and valued.
- Authenticating a Last Will and Testament submitted for probate.
- Litigating challenges to the Will if there are any.
- Notifying creditors of the estate and providing the opportunity to file claims against the estate.
- Paying creditors with valid claims.
- Calculating and paying any federal and/or state gift and estate taxes owed by the estate.
- Transferring assets to the intended beneficiaries and/or heirs of the estate.
For the most part, issues related to the probate of an estate are governed by state laws. Consequently, both the probate process and the rules that determine when probate is required can vary from one state to another. Whether probate is required, and which type of probate you must use, will depend on several factors, including the state where the estate is located, the value of the estate, the presence or absence of a Will, your relationship to the decedent, and the type of assets involved. Most states, including North Dakota, do offer alternatives to formal probate for small estates that qualify. Because formal probate can be time-consuming and costly, it is always a good idea to determine if an estate can avoid formal probate if you are in charge of administering the estate.
When Can an Estate Avoid Probate in North Dakota?
People often think that if the decedent left behind a Will the estate doesn’t have to go through probate. Almost all estates, however, are required to go through some type of probate, whether a Will was executed by the decedent or not. The real question people generally want to ask is whether the estate can avoid formal probate because formal probate can take months, even years, to complete. In addition, formal probate can be expensive given that everyone involved in the process (Executor, attorney, appraiser, accountant etc.) is entitled to a fee for their services.
Like most states, North Dakota does offer an alternative to formal probate for small estates that qualify. For an estate to use the small estate alternative the estate cannot include real property AND the value of the estate, less liens and encumbrances, cannot exceed $50,000. If the estate meets those two criteria, you can use an Affidavit for Collection of Personal Property to distribute estate assets.
Keep in mind that non-probate assets are not included when calculating the value of an estate. For example, proceeds of a life insurance policy or assets held in a trust do not count because those assets are non-probate assets that pass to the beneficiaries outside of the probate process. Likewise, real property that is jointly owned with rights of survivorship will also pass automatically, outside of the probate process, to the co-owner(s) upon the death of an owner.
Contact North Dakota Probate Attorneys
Please join us for an upcoming FREE seminar. If you have additional questions or concerns about which type of probate is required for an estate you are administering, contact a North Dakota probate attorney at German Law Group by calling 701-738-0060 to schedule an appointment.
Latest posts by Raymond German, Estate Planning Attorney (see all)
- New Tax Proposal re: Retirement Savings - June 18, 2019
- What Documents Are Needed for Estate Planning? - June 13, 2019
- 5 Steps for a Trustee to Take Immediately Upon Appointment - June 11, 2019