What happens to a person’s assets when they die? How is the Court involved?

Probate is a legal proceeding necessary to pay a deceased person’s, or decedent’s, debts and distribute his assets when he dies.  When writing his Will, a decedent will select someone to handle his assets when he dies, usually known as the Executor.  After the decedent’s death, the Executor will file the decedent’s Will in with the Probate Court.  If there is no Will, any interested person may petition the Court to be the Personal Representative of the estate.  After the Will or petition is filed in and accepted by the Court, the probate process begins.  The Probate process can be divided into three basic parts, as discussed below.

PART ONE:  INVENTORY OF ASSETS

The Executor will first have to gather and make a thorough accounting of all of the assets the decedent had at his death.  These assets will include real estate, personal property such as furniture or cars, bank and brokerage accounts, life insurance money, retirement accounts, and debts owed to the decedent.  The Executor will be held responsible by the Court for making sure that the assets are completely accounted for and protected for all the interested parties.

The Executor may have to sell the decedent’s home or personal property in accordance with the Will or to pay debt.  The executor may also have to take legal action to collect money owed to the decedent on behalf of the estate.  When all assets are gathered, the Executor will transfer them into the name of the estate and likely open an estate bank account to hold the assets for the duration of the probate process.

PART TWO:  PAYING THE BILLS OF THE ESTATE

The estate must remain “open” in the Probate Court for 6 months.  During this time, the executor must let any known creditors of the estate aware that it is open.  The creditor then has an opportunity to file a “claim” against the estate for any money owed to the creditor by the decedent.

 

During the 6 month period, the Executor will pay and/or negotiate any debts of the estate.  These debts include court costs, attorney fees, administrative/executor fees, funeral costs, taxes, debts and legitimate claims owed by the decedent.  If the Executor feels any claim is not legitimate, he must fight the claim in Court prior to closing the estate.

PART THREE:  TRANSFERRING ESTATE PROPERTY

At the end of the 6 month period, the Executor will distribute all remaining property according to the Will, or if there is no Will then according to the Law of the State of Alabama.  The Executor may sell and transfer the proceeds from any real estate or personal property, or may transfer the real estate or personal property directly to the heirs.  The Executor may then file a final accounting with the Court, allowing anyone who objects to the distribution of the estate to come forward.  Or, if all parties will waive the right to protest the estate, the waivers and a final settlement may be filed in.  It is very important that the Executor handle the collection and transfer of estate property correctly.  If he is found to be negligent, he can be held personally responsible for debts of the estate.

 

 

 

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About elderlawalabama

The Brannon Law Firm, LLC is a client-centered, solution based firm offering compassionate and comprehensive elder law, estate planning and public benefits planning. We are committed to providing quality service to our clients at reasonable prices.
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