Upon the death of a loved one, families face the burdensome task of distributing the property and debts of the deceased. That process—sadly—has the potential to strain familial relationships. With this in mind, Powers & Neal provides estate planning, including the creation of wills and trusts, in order for individuals to plan ahead and potentially avoid probate altogether. Unfortunately, many people fail to plan and their estates must be settled in an Arizona probate court.
So, what is probate? Probate is the legal proceeding by which the court oversees and adjudicates the process of transferring assets out of the name of the deceased person and into the name of the heirs. This process includes identifying the property, valid debts and heirs of the deceased. The purpose of probate is to: (1) ensure that the representative appointed to administer the estate does so in the best interest of the heirs of the estate; (2) identify and notify heirs; (3) ensure assets are properly distributed to heirs; and (4) discover and pay all of the decedent’s valid debts.
After a petition to open the probate is filed, the court will appoint a personal representative (called executor or administrator in other states). If the decedent left a valid will, the court normally appoints that person designated to act as personal representative in the will. The personal representative is then tasked with identifying heirs and creditors, providing required notices to heirs and creditors, gathering and creating an inventory of assets, paying valid debts, filing the decedent’s final tax return, disbursing assets to heirs and closing the estate. Read more about the steps of a typical informal Arizona probate.
In the process of identifying the decedent’s property and assets, he or she will learn that not all assets are subject to probate. Some examples of assets that are not usually subject to probate include life insurance, 401k accounts, IRAs, and other types of retirement accounts, since these types of assets explicitly name a beneficiary. Also, real estate subject to a beneficiary deed or held in joint tenancy will bypass the probate system, as will those assets held in the name of a revocable living trust. In fact, the only assets subject to probate are those which decedent held in his or her name alone and for which no beneficiaries have otherwise been designated.
There is no specified time period for how long it takes to complete probate and depends on the size of the estate, number of assets, potential creditor issues and whether or not there are disputes. At a minimum, the estate must be open 4 months. Arizona law requires that as creditors are given 4 months to present their claims, and if not presented, those claims are forever be barred.
At Powers & Neal we guide our clients through the process cognizant of the importance of communication, as well as expediency. Please call us to discuss how we can help you with an Arizona probate.