Here’s a common scenario: Dad dies. Stepchildren claim that stepmother is taking dad’s assets and not communicating with them. Stepmother claims that all of the marital assets passed to her as surviving spouse and the children are just bugging her. There’s conflict and confusion. Each side accuses the other of greed and ill will. Neither side understands its rights.
So how do we resolve the problem? Who gets what? Here’s a step by step process to help you sort it out.
Step One: Make a List How the Deceased Person’s Assets are Titled
It is important to start with a solid list of the decedent’s assets and how they are titled. That will determine the need for probate and the rights of the various parties. If you don’t know what the assets are and how they are titled, you’re stuck.
Step Two: Remove All Non-Probate Assets From the List
Not all assets are probate assets. Many assets pass automatically to a survivor based on how the asset is titled. Common examples of “non-probate” assets include:
- Real estate that is owned jointly with rights of survivorship will pass to the surviving owner(s).
- Bank accounts that are jointly owned will pass to the surviving owners.
- Life insurance and financial accounts (bank accounts, brokerage accounts, CDs) that have valid beneficiary designations will pass to the surviving beneficiaries.
- Assets that are titled in a living trust will pass in accordance with the terms of the trust.
In most cases, if the stepmother is able to get to the assets, it’s because she has a right to them. That’s not a hard and fast rule (after all, there is still some good old fashioned theft going around). But keep in mind that third parties (like banks, realtors, and title companies) know when probate is required and when it isn’t. If they are giving the stepmother access to the decedent’s property, it is usually because she became the owner of the property at the decedent’s death.
In other words, if the stepmother is spending money from a bank account, it is usually because she is a joint owner or designated beneficiary on the account. Otherwise, the bank wouldn’t give her access to the account. Similarly, if she sells real estate, it is because the real estate was titled jointly with rights of survivorship. Otherwise, she wouldn’t have insurable title. You get the picture. The ability to deal with the assets usually indicates ownership of the assets.
Step Three: Be Sure that You can Prove Ownership of Whatever is Left
Once you’ve made a list of assets, then subtracted out the non-probate assets, the assets that remain are assets of the estate. These are the “probate assets” that are governed by the deceased person’s will (if he had one) or the intestacy laws (if he died without a will).
If the decedent had a bank account or parcel of real estate in his name alone, everything is straightforward. That property will pass under the will or through the intestacy laws to his heirs are beneficiaries. The rights of the children and the stepmother in the property are easy to determine. All that needs to be done is to choose the person to represent the estate, hire the probate attorney, and start the process.
But many times, all that is left after subtracting out the non-probate assets is miscellaneous personal property (household furnishings, etc.). You then need to be able to prove who owns that property. If dad and stepmother went to the local retail store and bought a big screen TV, who did it really belong to? Can you prove in court that it was your father’s alone and not the stepmothers? In most cases, the answer is “no.” This kind of factual difficulty makes it almost impossible to claim an interest in most personal property.
Step Four: Decide Whether it’s Worth It
If you’ve gone through the first four steps, you should have a list of assets and know about what they are worth. You then need to compare the value of the assets with the cost of probate (or an alternative to probate) to determine whether it is worthwhile to deal with the estate in court.
For small estates, there may be an alternative to full estate administration that will make financial sense. If a full administration is required, you will want to be sure that the net value of the assets (after subtracting out the debts) involved exceed the value of the decedent’s property.
The best way to compare cost to value is to talk to an attorney. We offer a value pricing model that gives you an up-front fee quote. With that information, you can make an informed decision about which type of probate proceeding is right for you.