Common Mistakes to Avoid During Probate Administration
Probate is a legal process that follows the death of an individual, during which a court oversees the distribution of their estate and verifies that all debts and taxes are paid. While probate can be an essential process for settling an estate, it can also be filled with pitfalls.
At Watterworth Law Offices, located in Simsbury, Connecticut, we assist clients with probate administration throughout Hartford County, Litchfield County, and Tolland County. We’ve seen firsthand how some common mistakes during probate can create complications or delays. By being aware of these mistakes, we can avoid them and have a smooth administration of an estate.
Failing to Locate the Will
One of the first and most critical steps in probate is locating the decedent’s will. If the will isn’t found, it can lead to confusion and delays in the process. Sometimes, the will may be kept in a safe place like a safe deposit box or with an attorney. As administrators, we must make every effort to locate the will promptly.
Here are some common issues related to missing or misplaced wills:
Not knowing where the will is stored: Many people store their wills in places like safe deposit boxes, with their attorney, or even in their home. If the executor or administrator doesn’t know where it’s kept, it can delay the entire probate process.
Failure to search all potential locations: Be sure to check all personal files and consult with any individuals who may have had access to the will.
Not understanding the importance of a valid will: Without a valid will, the decedent’s estate could be divided according to the state’s intestacy laws, which may not reflect their wishes.
We recommend speaking with a probate attorney early on for help following the proper steps and for the best chance of locating the will in time.
Delaying the Probate Process
When a loved one passes away, it can be emotionally overwhelming. However, it’s important not to delay starting the probate process. Delays in filing the will for probate can create unnecessary complications, including issues with paying creditors and distributing assets.
Here’s why timely probate is essential:
Paying outstanding debts: Delays in opening probate could result in creditors taking legal action or fines for not addressing the decedent’s debts on time.
Distributing assets: Without probate, beneficiaries may not receive their inheritance when expected. Starting the process as soon as possible assures that beneficiaries can receive their share of the estate on time.
Compliance with deadlines: Probate requires certain filings to be done by specific deadlines. Missing these deadlines can complicate the process and result in fines or legal issues.
Our probate attorney encourages our clients to initiate the probate process promptly and closely monitor all court deadlines to prevent potential issues in the future.
Not Properly Identifying and Valuing Assets
Identifying and properly valuing the decedent’s assets is another critical step in the probate process. Failure to do so can lead to incomplete or incorrect distributions of assets and even issues with tax filings.
Here’s how probate attorneys help make sure all assets are properly handled:
Inventorying the estate: A comprehensive inventory of all assets should be created. This includes real estate, bank accounts, personal property, and investments. It’s important to make sure no assets are overlooked.
Getting accurate appraisals: For assets like real estate, antiques, or fine art, a professional appraisal may be necessary. Failing to get accurate appraisals can result in undervaluing or overvaluing assets, which can have tax implications.
Understanding non-probate assets: Certain assets, like life insurance proceeds or jointly held property, may not go through probate. It’s essential to know which assets are part of the probate estate and which are not.
By carefully identifying and valuing all assets, probate attorneys help avoid confusion and assure proper distribution to beneficiaries.
Not Notifying Creditors and Paying Debts
During the probate process, the administrator or executor must notify creditors of the decedent’s death and provide them with an opportunity to submit claims against the estate. If creditors aren’t properly notified, or if debts aren’t properly paid, the administrator could be held personally liable for the estate’s debts.
Why notifying creditors is so important:
Notifying creditors on time: Probate law requires creditors to be notified within a certain period after the probate process starts. If creditors aren’t informed properly, the estate could face penalties or unpaid debts.
Settling claims and disputes: Creditors may dispute debts, which could delay the probate process. Properly notifying them allows time for resolving these issues.
Not paying debts before distributing assets: If debts aren’t paid before assets are distributed, beneficiaries could face legal consequences. It’s essential to address all claims before distributing estate property.
Probate attorneys make sure creditors are notified correctly and that debts are settled promptly, so there are no lingering issues that could complicate the probate process.
Ignoring Tax Implications
Probate administration can have tax implications, including estate taxes, income taxes, and even inheritance taxes. Failing to address these taxes properly can lead to penalties, delays, or unnecessary costs.
Here’s how to help minimize tax issues during probate:
Filing tax returns: An estate tax return and possibly a final income tax return must be filed. Probate attorneys assist clients in filing all returns on time to prevent penalties.
Evaluating tax exemptions: Certain estates may qualify for tax exemptions. Probate attorneys work with clients to understand how they may benefit from these exemptions to reduce estate tax liability.
Proper asset distribution: Distributing assets in a tax-efficient manner can minimize the overall tax burden on the estate and beneficiaries. Probate attorneys help determine the most effective way to distribute assets to minimize tax liabilities.
By understanding the tax implications early on, probate attorneys help families avoid complications during the probate process and minimize taxes owed.
Mismanaging the Estate’s Assets
Once the probate process begins, the administrator has a fiduciary duty to manage the estate’s assets responsibly. Mismanaging the assets can lead to legal action, additional probate delays, and even personal liability for the administrator.
Ways to manage the estate properly:
Avoiding commingling funds: Estate funds must be kept separate from the administrator’s personal funds. Commingling funds can lead to confusion and potential legal issues.
Keeping proper records: All transactions related to the estate should be documented. This includes payments made, assets sold, and investments handled. Keeping thorough records helps protect the administrator from accusations of mismanagement.
Investing the estate’s assets responsibly: Sometimes, estate funds need to be invested during probate. This must be done cautiously and in a manner that aligns with the decedent’s wishes and the estate’s needs.
Probate attorneys assist administrators in managing estate assets properly, thus reducing the risk of legal issues.
Not Communicating With Beneficiaries
Effective communication with beneficiaries is crucial during probate. When beneficiaries aren’t informed, it can lead to misunderstandings, dissatisfaction, and even legal disputes.
How to foster clear communication:
Providing regular updates: Update beneficiaries regularly on the status of the probate process. Keeping them informed can prevent frustrations and confusion.
Explaining the process clearly: Probate can be a complicated process, but lawyers take the time to explain what steps are being taken and why. This helps beneficiaries understand the process and what to expect.
Addressing concerns promptly: Beneficiaries may have concerns or questions. Probate attorneys address these concerns as they arise, so issues don’t escalate into legal disputes.
By keeping lines of communication open, lawyers help the probate process go smoothly and help the beneficiaries feel heard and understood.
Probate Legal Assistance
At Watterworth Law Offices, we assist individuals with all aspects of probate administration in Simsbury, Connecticut, and the surrounding areas. We understand that probate can be a complicated process, and we’re committed to guiding you through each step to help you avoid common mistakes. Located in Simsbury, Connecticut, our services extend to clients across Hartford County, Litchfield County, and Tolland County. If you’re facing probate administration, contact us today.
