Probate & Estate administration is the process of managing and distributing a person’s property (the estate) after their death.
What is Probate Administration in New York?
If the decedent had a will, the process is known as a “probate proceeding.” Under this scenario, the Surrogate’s Court must deem the will valid. Validity is determined by reviewing whether the will was properly executed as required by law. Probate also ensures when a decedent has no will, everyone who would have inherited is notified of the probate proceeding, receives a copy of the will, and doesn’t object to having the will admitted to probate. After the will is admitted to probate, the decedent’s property is passed to legatees (the people named in the will). The Surrogates Court supervises the entire process, and it usually takes about a year to complete
What is Estate Administration in New York?
If the decedent had no will, the process is known as an “administration proceeding.” Under this scenario, the Surrogates Court will oversee the distribution of the decedent’s property to the interested parties entitled to receive the property pursuant to New York State’s laws of intestacy. Interested parties under New York State’s laws of intestacy are the decedent’s survivors:
• Nieces and nephews
• Grandchildren and more
This process usually requires a court-appointed administrator to obtain a surety bond, pay the premium for the bond, and provide a family tree identifying living heirs.
The Role of Executor and Administrator
The responsibility of distributing assets to the correct people ultimately falls on whoever was appointed executor (as identified in the decedent’s will) or administrator (usually the person bringing the petition in an administration proceeding).
The executor or administrator is responsible for securing tangible personal property. This means anything you can touch, such as silverware, dishes, furniture, jewelry, or artwork. You will need to determine accurate values of each piece of personal property, which may require appraisals, and then distribute the personal property as the decedent directed or as the laws of intestacy direct. If personal property is passed around to family members before you have the opportunity to take an inventory, this will become a difficult, if not impossible, task. Of course, this doesn’t apply to gifts the decedent may have made during life, which won’t be part of their estate.
Next, Social Security should be notified within a month of death. If checks are issued to the decedent by the Social Security Administration following death, those checks will need to be returned. Immediately after, the executor or administrator should notify the decedent’s pension company if they had a pension.
Then, when the grieving process is over, the executor or administrator must meet with an attorney to review the steps necessary to administer the decedent’s estate. Bring as much information as possible about your loved one’s finances, real property holdings, taxes, and debts. Don’t worry about putting the papers in order; the lawyer will have experience organizing and understanding confusing financial statements.
Other Steps Executors or Administrators Take
• Filing the original will, if one exists.
The executor named in the will must file the original will and petition at the Surrogates Court and pay the appropriate court filing fees to be appointed executor.
• Marshaling, or collecting, the assets.
You must find out everything the decedent owned to file a list, known as an “inventory of assets,” with the Surrogates Court nine months after getting appointed as executor or administrator. It’s generally best to consolidate as much of the estate funds as possible into one estate account. Bills and bequests should be paid from a single estate checking account, one you establish as directed by your attorney so that you can keep track of all expenditures.
• Paying bills and taxes.
If a state or federal estate tax return is needed, it must be filed within nine months of the decedent’s date of death. If you miss this deadline and the estate is taxable, severe penalties and interest may apply.
• 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 on those assets, an income tax return for the estate.
• Distributing property to heirs and legatees.
Generally, executors don’t pay out all of the estate assets until creditors have been given a seven-month period to make claims. This period starts from the date letters are issued by the Surrogate’s Court. But once the executor or administrator understands the estate and the likely claims, they can distribute most of the assets while retaining a reserve for unanticipated claims and the costs of closing out the estate.
• Filing an inventory of assets.
The executor or administrator must file an inventory of assets with the Surrogates Court listing all property associated with the decedent, whether it went through or remained outside of court proceedings. Before an executor or an administrator releases assets to beneficiaries, they may need to file an informal or formal accounting of estate assets, depending on the circumstances. Whether an accounting is necessary or not, an executor or administrator should receive a signed Release and Receipt from each beneficiary, releasing them from their duties as the fiduciary of the estate.
How Do You Avoid New York Probate or Administration?
When the Surrogate’s Court has to get involved in administering a decedent’s estate, there will be a loss of time, privacy, and control over the outcome, along with attorney fees and court filing fees. Most of the steps mentioned above can be eliminated by avoiding probate and administration proceedings altogether. This can be done by having joint ownership or beneficiary designations on all assets you own or with the use of trusts, particularly for sole ownership of real property. But, whoever is left in charge of the decedent’s estate 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.
Andreoli Law Group, P.C. concentrates exclusively on elder law & Medicaid planning, estate planning, and probate & estate administration.
Andreoli Law Group, P.C. i is located in Islandia, with availability in Westhampton Beach, NY, in Suffolk County, but we also practice in Nassau, Queens, Kings, New York, Richmond, and Westchester Counties. We welcome the opportunity to meet with you and discuss how we may be of service to you.