Chapter 4 - The Probate Process Flashcards Preview

Estate Planning > Chapter 4 - The Probate Process > Flashcards

Flashcards in Chapter 4 - The Probate Process Deck (36)
Loading flashcards...
1
Q

Define Abatement

A

The reduction in assets transferring to a legatee because the estate has insufficient assets to satisfy all the legatees.

2
Q

Define Ademption

A

Extinction of a legacy because an asset, specifically bequeathed to a legatee, has been disposed of prior to death.

3
Q

Define Administrator

A

A person, usually a relative of the deceased, appointed by the probate court to oversee the probate process when an executor has not been named.

4
Q

Define Ancillary Probate

A

Concurrent second probate process conducted in a non-domiciliary state in which the decedent owns property, which often requires the services of an attorney from that state, and separate court fees.

5
Q

Define Domicile

A

Where a person lives, location of their home.

6
Q

Define Estate Administration or Succession

A

The passing of property a death to surviving heir/legatees.

7
Q

Define Executor

A

Estate representative designated in the will by the decedent. An executor may service without bond if bond is waived by the decedent.

8
Q

Define Heir

A

One who inherits under state law.

9
Q

Define In Trust For (ITF) Accounts

A

A bank account utilizing a beneficiary designation.

10
Q

Define Legatee

A

One who inherits under the will.

11
Q

Define Letters of Administration

A

A legal document that affirms the power of the administrator to act as the agent of the probate court.

12
Q

Define Letters Testamentary

A

A legal document that affirms the power of the executor to act as the agent of the probate court.

13
Q

Define Pay-On-Death Bank Account

A

A bank account utilizing a beneficiary designation.

14
Q

Define Probate Process

A

The legal proceeding that serves to prove the validity of existing wills, supervise the orderly distribution of the decedent’s assets to the heirs, and protect creditors by ensuring that valid debts of the estate are paid.

15
Q

Define Situs

A

The place, generally referring to the state, where property is located.

16
Q

Define Surety Bond

A

A bond posted by the administrator or the executor of the estate to protect creditors, heirs, and legatees from losses created by the administrator or executor.

17
Q

Define Totten Trust

A

Not a trust, but rather a bank account with a beneficiary clause.

18
Q

Define Transfer-On-Death Account (TOD)

A

An investment account utilizing a beneficiary designation.

19
Q

Define Devisee

A

A person who inherits real property under the will.

20
Q

What are the possible ways assets may be transferred and retitled? 4

A
  • Probate process
  • Contract law
  • State titling law
  • State trust law.
21
Q

What are the advantages of transferring assets through the probate process?

A
  1. Implements disposition objectives of testator
  2. Provides for an orderly administration of assets
  3. Provides clean title to heirs and legatees
  4. Increases the chance that parties of interest have notice of proceedings and, therefore, a right to be hear.
  5. Protects creditors by insuring that debts of the decedent are paid.
22
Q

When will the probate court not honor the wishes set forth by the decedent in the will?

A

In Instances of proven fraud or undue influence by a legatee or third party regarding the decedent or in cases where the decedent lacked mental capacity to execute a will.

23
Q

How does the probate process protect a decedent’s named heirs?

A
  • Due to the probate processes orderly administration it prevents one legatee or heir from having priority over another of equal rank.
  • Provides them with a clear title (free of creditor’s claims) by clearing liens.
24
Q

How does the probate process protect a decedent’s creditors?

A

It ensures that the debts of the estate are paid before distributions are made to heirs or legatees.

25
Q

What are the disadvantages of the probate process?

A
  • Can be complex and excruciatingly slow - Delays
  • Can result in substantial monetary costs - Costs
  • The process is open to public scrutiny - Publicity
26
Q

What is the average cost to an estate of the probate process?

A

Between 5 and 10% of the estate’s value.

27
Q

What are ways other than probate that nontraditional couples have at their disposal to transfer assets without contest?

A
  • Annual gifting

- Transfer devices such as transfers by contract, titling with survivorship features, and trust.

28
Q

What is the first step in the probate process?

A

Produce the will if one can be found. Any person can begin the probate process by presenting the will to the probate court.

29
Q

What is the second step the the probate process?

A

The interested parties must go to the probate court to open the Estate Administration or Succession Process.

30
Q

Generally, what is the most appropriate probate court?

A

The court where the person was domiciled at death.

31
Q

What information does the petitioner (generally the executor) need to supply the court to begin the probate process?

A
  • Certified copy of the death certificate
  • Last will (if available)
  • List of names and addresses of the decedent’s heirs
  • List of known creditors.
32
Q

If all the paperwork is in order that was supplied to the probate court to begin the process, what do they do?

A
  • Accept the will
  • Filed in the public records
  • Court will officially open the probate process
  • The court will then appoint a personal representative.
33
Q

If the will was not self proving, what extra steps have to be taken?

A

Witnesses must testify that the decedent did sign the will and was mentally competent. They will be needed at the initial hearing to validate the will.

34
Q

What is marshaling the assets?

A

When an executor or administrator identifies and takes control of the decedent’s assets.

35
Q

Which type of assets have to go through probate to be retitled?

A

Those held as

  • Fee simple
  • Tenancy in common
  • Community property
36
Q

What is needed to collect life insurance proceeds?

A

The beneficiary has to provide a certified copy of the death certificate to the insurer.