What is probate?

Probate is the legal process of transferring ownership from the decedent to the next person in line to inherit. Probate involves the determination by the probate court that a document is the last will and testament of the person who died, also called a “decedent.” Probate also involves doing all the things a probate court has the power to do in finalizing someone’s affairs.

Here are some of the most common probate proceedings:

• Determining if the decedent left a valid last will and admitting it to probate

• Appointing and qualification of a personal representative of the decedent’s estate

• Contesting wills

• Determination of heirship

• Determining title to property, who has the right to property claimed by or against a personal representatives

• Administration, settlement, and distribution of a decedent’s estate

• Construction of wills

WHAT IS A PERSONAL REPRESENTATIVE?

Also called an “executor,” “administrator,” “administrator with will annexed,” and “administrator de bonis non,” a personal representative is the person authorized by the court to handle the estate.

The personal representative is appointed by the court by limited judgment and receives either “letters testamentary” (which means the power comes from the will) or “letters of administration” (which means the power comes from the court without a will). The court will list any conditions or limitations imposed on the personal representative in the letters of administration or testamentary.

WHAT IS BOND? DO I HAVE TO PAY IT?

A bond is a legal contract, similar to insurance, where the personal representative pays a premium to a surety company that promises to pay the people interested in the estate in case the personal representative causes harm to the estate.

Probate courts require a bond, and the personal representative cannot act unless there is an exception that the personal representative qualifies for.

What are the exceptions to the bond requirement?

• The decedent’s will waives bond (most common exception, though a court may still choose to require a bond for good cause)

• The personal representative is the sole heir or devisee of the estate (depends on the court and county, and a court may still choose to require a bond for good cause)

• The personal representative is a governmental representative (Department of Human Services, Department of Veteran’s Affairs, etc.) (this is uncommon)

WHAT IS A “PROBATE ESTATE”?

Not everything a decedent owned is a probate asset. A person’s estate means everything they own; whereas a probate estate means only assets that pass by probate. A probate estate only exists until the administration of the estate is complete. Once all the assets have been distributed and the personal representative is discharged, the probate is over, and there are no probate assets.

The reason it is important to understand the difference is that the probate court only has jurisdiction over probate assets. If an asset isn’t subject to a probate court, then the personal representative doesn’t have authority over it. Also, if an asset isn’t part of the probate estate, it doesn’t pass according to the decedent’s will, if there is a will, or according to the state law of intestate succession.

Three key categories of assets that typically do not pass by probate are trust assets, assets that pass by contract, and joint assets.

If a decedent created a revocable living trust (also called an intervivos trust), and funded all of their probate assets into the trust, then probate will not be required, and the trust will contain provisions for the administration of the assets. Though not necessarily required, trustees may choose to petition the court to determine creditors of the decedent, the assist with appointment of a successor trustee, and approve certain trust accountings.

Life insurance proceeds that name a beneficiary are assets that pass by contract. Also, retirement benefits that name a beneficiary are also assets that pass by contract. Both of these assets are part of a decedent’s estate, but they are not part of the probate estate. For example, a bank account titled in the decedent’s name alone and that does not have a beneficiary named on the bank’s beneficiary designation forms is a probate asset.

Joint assets or joint tenancy assets pass to the surviving owner or owners upon the decedent’s death. A bank account held by a married couple or by two unrelated people will not require probate if one of the tenants survives.

Another phrase you will see is “gross estate,” which is a tax concept. The definition can be found in the Internal Revenue Code Section 2031, “The value of the gross estate of the decedent shall be determined by including to the extent provided for in this part, the value at the time of his death of all property, real or personal, tangible or intangible, wherever situated.” The gross estate is essentially the value of all the assets and is used to calculate how much estate tax will be due from the estate. While some assets in the gross estate may be part of the probate estate, that only means those assets must go through probate court.

HOW DO I START PROBATE?

Probate begins with a consultation to discuss whether your family member or loved one had a will and a discussion about their probate estate. If probate is required, the law office of Nicole B. Erickson, Attorney at Law, P.C., is ready to help with all the court filings, analysis, and assistance required to start, process, and finish the probate of the estate. Through careful analysis, we will also diagnose whether there are tax matters that should be addressed sooner than later. Examples include confirming whether an estate tax return (either state or federal) is required, whether a disclaimer should be considered, and generally analyzing the estate to identify tax problems before the problems come to you.

ABOUT PROBATE ATTORNEY NICOLE B. ERICKSON:

A POWERFUL ADVOCATE AND STRATEGIC LEGAL PARTNER ON YOUR SIDE

NEXT LEVEL LEGAL SERVICE - LICENSED IN OREGON AND WASHINGTON

Nicole B. Erickson brings unparalleled energy and sophisticated technical tax expertise to business matters, tax planning, and estate planning, serving clients from offices in Portland and remotely throughout Oregon and Washington. She delivers timely and practical results giving clients the freedom to focus on what matters most.  With a wealth of more than ten years of sophisticated estate planning and probate experience, she benefits her clients with long-range planning that seeks to avoid potential conflict and improve the bottom line.

Prior to founding the law office of Nicole B. Erickson, Attorney at Law, P.C., Nicole practiced with small and mid-size Portland firms, adding practical tax knowledge and courtroom experience to her repertoire.  Before moving to Oregon, she served ultra-high net worth clients at a large regional law firm in Texas, crafting tax settlements for multi-billion-dollar tax disputes which remain confidential. 

Nicole loves adventure and has traveled to Dubai, sailed the Mediterranean, and marched in protests in Barcelona. In her free time, she enjoys exploring the outdoors in the Pacific Northwest with close friends and family.

SPECIALTIES

• ESTATE PLANNING AND PROBATE

Wills and Trusts, Probate, Trust and Estate Litigation, Elder Abuse, Guardianship/Conservatorship, Charitable Planning, Business Succession Planning, Estate/Gift/GST Tax Planning, Charitable Trusts (CRATs, CRUTs, NIMCRUTs, CLATs, CLUTs), Grantor Trusts (IDGTs, GRATs, Qualified Personal Residence Trusts or QPRTs), Irrevocable Life Insurance Trusts (ILITs), Gifting Trusts, Family Limited Partnership planning, asset protection strategies, blended family planning, and same-sex couples planning.

EDUCATION

• NYU School of Law - LL.M. in Taxation

• The University of Texas at Austin School of Law - J.D.

• The University of Texas at Austin - B.A. Government, with honors

Nicole earned her LL.M. in Taxation from NYU, the foremost program of its kind in the world. Showing her aptitude for strategy and expediency, Nicole was the youngest in her law school class at the University of Texas School of Law, having graduated from college with honors in just two years. Nicole ranked 11th in the nation at the National Forensic League National Tournament in Lincoln Douglas Debate.