Probating an estate can be a complex process, and the initial step involves identifying the assets within the estate. From personal and real property to financial assets, including cash, understanding the estate's composition is crucial. Let me share a lighthearted anecdote about a client's unexpected discovery of $200,000 in cash while searching for his mother's will in her safety deposit box. This emphasizes the importance of knowing the whereabouts of your parents' safety deposit boxes.
Once you've established the estate's assets, the next step is determining the order of payments. Here's a breakdown of the priority:
1. Family's Year's Support: In cases where assets are limited and debts are high, a special proceeding called a year's support is initiated to provide for the family's immediate needs.
2. Funeral Expenses: The first financial obligations include covering funeral expenses to ensure a dignified farewell for the deceased.
3. Administrative Expenses: Following funeral costs, administrative expenses take precedence. This includes attorneys' fees, filing fees, and any other costs associated with the probate or administration process.
4. Last Illness Expenses: Reasonable expenses related to the decedent's last illness must be addressed and settled.
5. Unpaid Taxes and Judgments: Next in line are any unpaid taxes of the decedent, as well as outstanding judgments against them.
6. Creditors: The final stage involves settling the debts owed to creditors, such as loans or car loans.
Understanding this sequence helps streamline the probate process and ensures that all necessary obligations are met. Probating an estate may have its challenges, but with a clear understanding of asset identification and payment prioritization, you can navigate this intricate process more effectively. Stay informed, be aware of safety deposit box locations, and approach estate probate with the necessary knowledge and preparedness.
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Lisa Glauber Shippel