If you recently lost a loved one you are undoubtedly managing the emotional impact of your loss. You may not wish to focus on anything else, however, if you were appointed by the decedent to be the Executor of his/her Last Will and Testament, or the family is looking to you to take charge in the absence of a Will, it will be up to you to handle the legalities involved in distributing the decedent’s estate. Typically, that entails going through the legal process known as probate. When is probate not necessary in New York though? If the estate qualifies, you may be able to forego the often lengthy and costly probate process.
Probate is the legal process that is often required following the death of an individual. Probate serves several functions, including:
- Ensuring that the decedent’s assets are identified, located, and secured.
- Authenticating a Last Will and Testament submitted for probate.
- Litigating challenges to the Will.
- Notifying creditors of the estate and providing the opportunity to file claims against the estate.
- Calculating and paying any gift and estate taxes owed by the estate.
- Transferring assets to the intended beneficiaries and/or heirs of the estate.
When an estate is required to go through the formal probate process it typically costs everyone involved both time and money. Because creditors are allowed up to seven months to file claims against an estate in New York, it takes a minimum of eight or nine months to complete the probate of even a relatively modest estate. A more complex and/or valuable estate can easily take well over a year to probate. Not only do beneficiaries have to wait all that time before receiving their intended inheritance, but the monetary costs involved in the probate process can significantly diminish the value of the estate that is ultimately passed down.
Small Estate Alternatives
For the most part, issues related to the probate of an estate are governed by state laws. Consequently, both the probate process and the rules that determine when probate is required can vary from one state to another. Whether probate is required, and which type of probate you must use, will depend on several factors, including the size of the estate, your relationship to the decedent, and the type of assets involved. Most states, including New York, do offer an alternative to formal probate for small estates that qualify.
In the State of New York, if the Decedent had less than $30,000 of property with a Last Will and Testament or without, then a small estate, also called a voluntary administration proceeding, can be filed instead. If the decedent owned real property alone, without regard to the value, the estate does not qualify for voluntary administration. If the decedent owned real property jointly with someone and had personal property valued at less than $30,000 the estate may still qualify for small administration.
In a small estate proceeding, the Surrogate’s Court appoints a Voluntary Administrator. If there is a Will, the Executor of the Will is appointed the Voluntary Administrator. If there is no Will, then the closest heir is named the Voluntary Administrator. The Surrogate’s Court issues a certificate for each asset listed in the papers which the Voluntary Administrator collects and distributes according to the law.
When Is Probate Not Necessary in New York?
The other way to get around the probate process is with an estate that is primarily made up of non-probate assets. Not all assets are legally required to go through probate. Non-probate assets bypass probate and can be distributed to the named beneficiary immediately after the death of the owner. Common examples of non-probate assets include:
- Trust assets
- Life insurance proceeds
- Assets held in an account designated at a “Payable on Death (POD)” or “Transfer on Death (TOD)” account
- Retirement or pension accounts
- Certain types of jointly owned property if owned with “rights of survivorship”
People who consider probate avoidance to be an important estate planning goal often elect to establish a trust to hold, and eventually distribute, the majority of their estate assets. The trust becomes their primary estate planning document instead of their Will. When a trust is used, all trust assets will avoid formal probate.
Contact New York Probate Attorneys
Please feel free to download our FREE estate planning worksheet. If you have additional questions or concerns regarding the probate process in New York, contact the New York probate attorneys at the Law Offices of Kobrick & Moccia by calling 800-295-1917 to schedule your appointment.
- “Last Will and Testament” Origin - April 1, 2021
- Do I Need a “Durable” Power of Attorney? - April 2, 2020
- Joint Tenancy Pros and Cons - March 31, 2020