Probate assets are Assets that do not Pass by Beneficiary Designation or Operation of Law.
Consider the following example: Gretta died in February 2019 domiciled in Brooklyn and survived by her three children. She had a last Will and Testament that named her daughter, Inga, as executor. At the time of her death, Greta owned the following property: a checking account owned in her name alone; a savings account owned in her name alone; one checking and one savings account owned jointly with her daughter, Inga; a Transfer on Death Account naming her two sons as beneficiaries; her home in Brooklyn owned in her name alone; a life insurance policy that names her three children as equal beneficiaries; stocks owned in her name alone; and a car owned in her name alone. In this example, the probate assets are: the checking account held only in Greta’s name; the savings account held only in Greta’s name; her home in Brooklyn; stocks owned in Greta’s own name, and the car.
Inga is now preparing the probate petition for her mother’s estate. When she gets to paragraph 9, which asks her to provide the total value of the decedent’s probate assets (or property), she gets stuck. She does not know what should be included. Which of Gretta’s property should Inga include in the probate petition?
What Needs to Go through Probate?
Probate assets includes all property that is owned individually by the decedent and does not pass by operation of law. Any property that has a named beneficiary is not a probate asset.
Therefore, Inga should include the values of Gretta’s accounts that were named in her name alone, Gretta’s home in Brooklyn, Gretta’s stocks, and Gretta’s car.
It is important to know whether the decedent held any probate assets and the approximate value of those probate assets in order to know whether a fiduciary must be appointed by the Surrogate’s Court. Regardless of whether the decedent died with or without a will, if the decedent owned probate assets at the time of her death, a fiduciary must be appointed in order to administer those assets.
In addition, whenever a probate or administration petition is filed, the petitioner must pay a filing fee. The filing fee due is determined by the total value of the probate estate. Pursuant to SCPA §2402, the filing fee for filing a probate or administration petition is calculated as follows:
If the value of the estate is: then the fee due 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
(Note that if the decedent died owning probate personal property with a value of $30,000 or less, a voluntary administrator can be appointed. The process for a voluntary administration proceeding is a lot less complex, takes less time, and has a filing fee of only $1.)
The fiduciary must also know what is in the estate so that she can make any distributions to anyone entitled to a share of the estate. (This means distributing to beneficiaries of the will if there is a will and it has been admitted into probate or distributing to the decedent’s distributees in accordance with EPTL § 4-1.1, if there is no will.)
The value of each probate asset is its fair market value at the date of the decedent’s death. Values listed on the petition can be estimates.
What is not a Probate Asset?
An asset is not a probate asset when the asset is either owned jointly by the decedent and one or more owners or otherwise passes by operation of law. Examples of property that can pass by operation of law are property held in Trust, Totten Trust, Tenancy by the Entirety, Joint Tenants, and Joint Tenants with Rights of Survivorship.
Nonprobate assets do not need to be included in a probate or administration petition.
Going back to our previous example, the following assets are nonprobate assets: the checking and savings account owned jointly by Gretta and Inga, the Transfer on Death Account naming beneficiaries, and the life insurance policy.
Do I Need Probate if there are no Probate Assets?
No. If there are no probate assets, Surrogate’s Court involvement is not needed.
Generally, for non-probate assets that name beneficiaries, the beneficiary should contact the entity that holds the asset and find out what is required to collect the proceeds of the asset. Each entity requires different paperwork, but they generally require that the beneficiary produce the decedent’s death certificate.
For jointly held assets, the surviving co-owner should retitle the ownership to reflect that the survivor is now the sole owner of that asset.
Are Household Items Considered Probate Assets?
Yes, but where the value of such property is negligible, it is not always necessary to report the values on the probate or administration petition. In addition, household items
How do you Avoid Probate?
Probate can be avoided by creating a Trust, owning all of your assets jointly with others, or naming beneficiaries on your assets.
Note that after creating a trust, the creator must transfer all of his assets into the trust in order to avoid probate. Pour-over wills are often created simultaneously in order to catch all of the property that has not been transferred into the trust and then transfer it into the trust upon the creator’s death. However, that pour-over will will need to be probated and an executor will need to be appointed if any of the assets have not been transferred into the trust. Similarly, if there is no pour-over will and not all of the assets have been transferred into the trust, an administrator will need to be appointed.
How do I Access a Deceased Person’s Bank Account?
If the bank account was owned individually by the decedent with no named beneficiaries, then this bank account is considered a probate asset and a fiduciary will need to be appointed before the bank account proceeds can be accessed.
As explained above, if the bank account is owned jointly or has named beneficiaries, the beneficiary will have to contact the bank and find out what the bank needs before it can distribute the proceeds. The Court will not have to appoint a fiduciary for those assets to be distributed.
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