When a person passes away and leaves behind assets in his or her name, his or her heirs must begin the estate administration (if there is no will) or probate process (if there was a will) to handle the distribution of the property. During the administration or probate process, a decedent’s property is collected, debts are paid and the remaining assets are distributed to the beneficiaries of the Last Will and Testament. However, it may come as a surprise that not all assets are a part of the probate estate (we will refer to the “probate estate” even for those estates that did not have a will). In fact, the probate estate consists of all property that is owned individually by the decedent that does not pass to a beneficiary designation or is held in trust or jointly owned with another individual.
Almost any asset can be a part of a decedent’s probate estate, but common probate assets include individually held real estate and bank accounts, personal property, stocks, bonds, and motor vehicles. Typical non-probate assets include retirement accounts, such as 401Ks, with named beneficiaries, property owned in a living trust, life insurance proceeds, and any type of transfer on death account. These types of non-probate assets will pass automatically to the named beneficiary or joint owner upon the presentation of a death certificate to the financial institution maintaining the account.
To illustrate the way different assets are treated, consider the following example: Melissa died in July of 2019 while living in Nassau County, New York. She is survived by her two children, Grace and Emma, and her three grandsons. Melissa had done some estate planning and, therefore, had a Last Will and Testament which named her daughter, Grace, as her executor, and a Living Trust which named both Grace and Emma as Trustees. When she died, Melissa was the owner of the following assets: a checking and savings account in her name, alone, a checking account owned jointly with both Grace and Emma, an investment account in her name, alone, her home in Nassau County in her name, alone, a vacation home in the Catskills owned by the Living Trust, a life insurance policy that named her grandsons as equal beneficiaries, a car, and a boat.
In this example, Melissa’s probate assets include the following: her checking and savings accounts in her name, alone, investment account, home in Nassau County, car, and boat. This means that each of these assets will be listed on the probate petition by Melissa’s daughter, Grace, as part of her probate estate. After any creditors of Melissa’s have been paid, the remaining assets will be distributed according to the terms of her Last Will and Testament. The non-probate assets include the following: her checking account owned jointly with Grace and Emma (which will pass to the two of them when they present the bank with a copy of Melissa’s death certificate), life insurance policy (which will pass to her grandchildren, also upon presentation of a death certificate to the life insurance company), and home in the Catskills, which can be transferred to the Trust’s beneficiaries by Melissa’s Trustees, Grace and Emma.
When filing a probate petition, you will be asked to list the probate assets and their values (an approximation is sufficient at this point). This is partly because the probate petition filing fee is calculated based on this value. Non-probate assets generally do not need to be included in the probate petition, nor are they used in calculating the filing fee.
If the value of the estate is: The filing fee due to the Surrogate’s Court is:
Less than $10,000
$45.00
$10,000 but under $20,000
$75.00
$20,000 but under $50,000
$215.00
$50,000 but under $100,000
$280.00
$100,000 but under $250,000
$420.00
$250,000 but under $500,000
$625.00
$500,000 and over
$1,250.00
If a decedent’s estate has no probate assets because each of their assets has a beneficiary or otherwise passes by operation of law, then no court involvement is necessary. If a person seeks to avoid probate, he or she may do so by providing beneficiary designations on each account that permits it or adding joint owners to other assets, and when those are not appropriate options, by placing the remainder in a trust. Typically household items have a minimal value and will not require probate on their own.
For more information about the probate process or for assistance with becoming appointed as the fiduciary of a loved one’s estate, call the Law Offices of Roman Aminov at 347-766-2685 to speak to our experienced estate planning and estate administration attorneys during a free phone consultation.
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