You’ve probably heard about the horrors of probate. It’s time consuming, expensive, and invasive. While the process does have it’s shortcomings (although these may not be as bad as you think), there are benefits to probate too.
Just so we’re all on the same page- probate is the legal process for distributing a person’s assets after they’ve died. The process includes assessing the validity of the will (if there is one), appointing a personal representative to administer the estate, and publishing notice to heirs and potential creditors. The court oversees the entire process and manages disputes between beneficiaries. The probate system was designed to ensure that a person’s property and accounts are distributed according to state law. Still, due to the drawbacks of probate, many focus their estate planning efforts on avoiding probate completely. They don’t consider the benefits of this system. Here are some of those benefits:
The probate process is reliable
One of the major benefits of the probate process is that it is a reliable system that is available to everyone after their death. The probate process is time-tested and follows a specific set of procedures. The court oversees each probate and ensures that the administration of each estate is done according to state law. This includes making sure that the personal representative is following the decedent’s will and that the assets are accounted for and distributed properly. Court oversight can help provide a peace of mind to both the decedent and the beneficiaries. The decedent can die knowing that there is a formalized process for carrying out the wishes in their will. The process can also provide a sense of fairness and finality for beneficiaries.
The probate process protects against future creditors claims
The probate process protects beneficiaries by limiting the amount of a time that a creditor can file a claim against the estate. Under Arizona Law, the personal representative must give written notice by mail to all known creditors. They also must publish a notice to creditors in the county’s newspaper of general circulation. Generally, creditors have 4 months after the published notice or 60 days after the delivery of the mailed notice to present their claim. Creditors are barred from making a claim if they do not make it within the time limit.
By setting strict time limits for creditors to make claims, beneficiaries can rest assured that by the time they get their distributions, all claims have been settled.
Probate can give formal resolution in disagreements between beneficiaries
Probate court offers a formal way to settle disagreements between beneficiaries of an estate. Estate administration can be a touchy subject for many families and can lead to a lot of disputes. Unfortunately, not all beneficiaries or family members agree on how an estate should be administered. Often times, one beneficiary or heir may look at the will and question if it is really valid. Beneficiaries may question if the decedent was of sound mind when they made certain designations. The beneficiary could also question if the will was a product of undue influence.
When these sorts of disagreements arise, having a court overseeing the probate process can be really helpful. The court acts as a neutral third party and can determine the validity of the will. They can resolve disputes between beneficiaries.
Not convinced yet? There are a number of other advantages to the probate process. The probate process ensures that all debts, taxes, and fees are taken care of before the assets are divided. The process can serve as a check against fraud. The probate process is accessible for those with smaller estates who feel estate planning is unaffordable. It also provides a process for those who die intestate (without a will).
But, just because there are some advantages to probate, does not mean that it should be your goal. If you’re considering different types of estate plans, consider doing a cost-benefit analysis to weigh the pros and cons of probate and probate avoidance. You should also consult with an estate planning attorney (like the ones here at Fleming & Curti, PLC) to discuss your options and what is best for you.