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Estate Administration

 
    Estate Administration

Probate is the process by which a deceased person's property, known as the "estate," is passed to his or her heirs and legatees (people named in the will). The entire process, supervised by the probate court, usually takes about a year. However, substantial distributions from the estate can be made in the interim.

The emotional trauma brought on by the death of a close family member often is accompanied by bewilderment about the financial and legal steps the survivors must take. The spouse who passed away may have handled all of the couple's finances. Or perhaps a child must begin taking care of probating an estate about which he or she knows little. And this task may come on top of commitments to family and work that can't be set aside. Finally, the estate itself may be in disarray or scattered among many accounts, which is not unusual with a generation that saw banks collapse during the Depression

The exact rules of estate administration differ from state to state. In general, they include the following steps:

1.    Filing the will and petition at the probate court in order to be appointed executor or personal representative. In the absence of a will, heirs must petition the court to be appointed "administrator" of the estate.

2. Marshaling, or collecting, the assets. This means that you have to find out everything the deceased owned. You need to file a list, known as an "inventory," with the probate court. It's generally best to consolidate all the estate funds to the extent possible. Bills and bequests should be paid from a single checking account, either one you establish or one set up by your attorney, so that you can keep track of all expenditures.

3. Paying bills and taxes. If an estate tax return is needed---generally if the estate exceeds $675,000 in value---it must be filed within nine months of the date of death. If you miss this deadline and the estate is taxable, severe penalties and interest may apply. If you do not have all the information available in time, you can file for an extension and pay your best estimate of the tax due.

4. Filing tax returns. You must also file a final income tax return for the decedent and, if the estate holds any assets and earns interest or dividends, an income tax return for the estate. If the estate does earn income during the administration process, it will have to obtain its own tax identification number in order to keep track of such earnings.

5. Distributing property to the heirs and legatees. Generally, executors do not pay out all of the estate assets until the period runs out for creditors to make claims, which can be as long as a year after the date of death. But once the executor understands the estate and the likely claims, he or she can distribute most of the assets, retaining a reserve for unanticipated claims and the costs of closing out the estate.

6. Filing a final account. The executor must file an account with the probate court listing any income to the estate since the date of death and all expenses and estate distributions. Once the court approves this final account, the executor can distribute whatever is left in the closing reserve, and finish his or her work.

Some of these steps can be eliminated by avoiding probate through joint ownership or trusts. But whoever is left in charge still has to pay all debts, file tax returns, and distribute the property to the rightful heirs. You can make it easier for your heirs by keeping good records of your assets and liabilities. This will shorten the process and reduce the legal bill.
 
 
 
 
 
 
 
 
 
Send mail to maberasturi@ny-elderlaw.com with questions or comments about this web site.
Last modified: 12/21/06
Mark G. Aberasturi, a New York elder law lawyer and estate planning attorney, focuses his law practice on Elder Law and Probate, Estates, Wills and Medicaid Trusts, Living Trusts, Supplemental Needs Trusts, Living Wills and Estate Tax.  Mr. Aberasturi provides legal advice on matters involving Medicaid, Medicare and nursing homes.  Mr. Aberasturi is a member of the National Academy of Elder Law Attorneys, The New York State Bar Association Elder Law Section, and is former chairman of the Orange County, New York Bar Association Elder Law Committee.  His practice is located in Goshen, Orange County New York.
 
Servicing the Hudson Valley area, including Monroe New York 10950, Montgomery New York 12549, Middletown New York 10940 and 10941, Newburgh New York 12550, Wallkill New York 12589, Washingtonville New York 10992, Chester New York 10916, Port Jervis New York 12771, New Windsor New York 12553, Cornwall New York 12518, Central Valley New York 10917, Highland Mills New York 10930, Florida New York 10921, Walden New York 12586, Warwick New York 10990, and Maybrook New York 12583, Tuxedo Park New York 10987, Blooming Grove New York 10914, Circleville New York 10919, Fort Montgomery New York 10922, Harriman New York 10926, Pine Bush New York 12566, New  Hampton New York 10958, Slate Hill New York 10973, Wallkill, New York 12589, as well as Ulster County, Sullivan County and Rockland County.
 
 
This web site is designed for general information only. The information presented on this site should not be construed to be formal legal advice or the formation of a lawyer/client relationship.  Prior results do not guarantee a similar outcome.
 
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