Probate is the court-supervised process of locating and determining the value of the assets owned in the individual name of a deceased person, referred to as a "decedent," paying the decedent's final bills and estate taxes and/or inheritance taxes (if any), and then distributing what's left of the decedent's assets to his or her heirs.
How to Probate an Estate
Each state has a specific set of laws that will determine the particular probate process to be followed in that state. While these laws will vary from state to state, in general they'll require the following steps to settle an estate:
- Appointing a Personal Representative - Appointing a Personal Representative, also called an Executor or Administrator, to oversee the disposition of the estate;
- Locating the decedent's assets - Locating and protecting all of the decedent's assets;
- Determining date of death values - Figuring out the date of death values for all of the decedent's assets through account statements and appraisals;
- Identifying known creditors - Locating all of the decedent's creditors and then notifying them of the decedent's death;
- Publishing a notice in the newspaper - Publishing a notice in a local newspaper to notify any unknown creditors of the decedent's death;
- Paying bills - Paying all of the decedent's final bills;
- Filing income tax returns - Filing the decedent's final income tax return and any estate income tax returns if the estate earns any income during the administration;
- Determining estate tax liability - Determining if any estate taxes will be due, both at the state and federal levels;
- Paying any estate taxes and/or inheritance taxes - If any estate taxes (federal and/or state) or inheritance taxes will be due, raising the cash necessary to pay the taxes and then paying them in a timely manner (usually within nine months of the decedent's date of death); and
- Distributing the remaining balance to the beneficiaries - Distributing the balance of what's left of the decedent's assets after all of the bills and taxes have been paid to the beneficiaries named in the decedent's Last Will if the decedent had one, or to the decedent's heirs at law if the decedent didn't have a Last Will.