Probate is the process of settling the debts of the deceased and distributing assets in accordance with the Will under the supervision of the court. Probate is not expensive unless the Will is disputed, but those are rare cases despite what is published in the media.
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Probate is nothing to fear or worry about. Many assets can be passed outside of probate and your
attorney can help you decide how to approach probate depending upon your individual
circumstances.
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What does “Probate” mean?
Probate is the legal and administrative process that determines the value of the assets of the deceased
person and distributes their assets according to Montana state law. Probate proceedings serve to:
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Determine whether the deceased person had a will and the validity of that will;
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Appoint a personal representative to gather, manage and protect the property and assets of the deceased
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Identify and notify heirs and/or devisees of the estate;
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Pay debts of the deceased and settle creditor claims;
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Distribute assets and property of the estate to the heirs and devisees.
Should Probate be avoided in general? No.
Probate is a specific court procedural process to finish the affairs of the deceased and pass property to heirs free of liens and encumbrances. In Montana, probate is required by law for an estate that is valued at over $50,000.00.
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Does a Trust replace the need for Probate? No.
A Trust requires administration and fees just like a probate and is often more expensive than probate and without well established laws to manage disputes.
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Why is a Trust believed to be a better alternative to Probate by some?
Because at one time they were in the 1990s, but the Estate or Death tax laws have change to make them almost obsolete! In the old days, most Trusts were created costing several thousands of up front loaded expensive fees with the hope to avoid the Estate or Death Tax year later, and it worked often. But, Trustee management fees by financial institutions were and are ongoing at as high as 3% of the Trust value per year. Park $1,000,000.00 in a Trust and the parking fee per year is $30,000.00 to simply mail out a monthly statement!
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Short general history of Estate or Death Tax:
An estate valued at $300,000.00 or more was taxed at about 35% to 45% in the 1990s. In the early 2000s, only an estate valued over $1,000,000.00 was taxed and then the exemption rose again to $5,000,000.00 and more recently went to $10,000,000.00! What does this mean? In general, a single person would need to have an estate over $10,000,000.00 to trigger the tax, and a married couple would need to have over a total of $20,000,000.00 in combined assets before the Estate or Death tax apply. This means that probably 99.7% of all Americans have zero exposure to Estate or Death tax. Therefore, Trusts are almost obsolete except for a few specific special needs situations that arise for children, adult with special needs, legacy real estate and fortunate people that have a high net worth.
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Should I do Probate myself as the Personal Representative of the Estate? No,
unless you are skilled and confident enough to perform a do-it-yourself automotive engine over-haul or an open-heart surgery. This is a bad DIY project that you will end up hiring an attorney to fix your mistakes and finish.
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A General List of Informal Probate documents needed depending on the individual case and client is as follows:
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Death Certificate of John/Jane Doe
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Will of John/Jane Doe
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Application for Informal Probate of Will and Appointment of Personal Representative
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Acknowledgment of Fiduciary Duty
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Order of Informal Probate of Will and Appointment of Personal Representation
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Letters
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Notice and Information to Heirs and Devisees
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Notice to Creditors
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Inventory of Assets
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Notice of Filing Affidavit of Publication
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Personal Representatives Sworn Statement To Close Estate.
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Order to Close – required by some Judges.