Americans are expected to inherit about $764 billion this year. Despite the number of Americans who rely on inheritance as a source of income, there’s a lot of people who don’t know about US inheritance law. These laws differ on a state-by-state basis, which is another reason inheritance laws appear so complex.
Are you preparing a will or expecting an inheritance in the future?
If so, keep reading to learn everything you need to know about inheriting money. By learning more about inheritance laws, you can prepare yourself for the process to come.
Keep reading for your guide to US inheritances.
The Probate Process
When a deceased family member makes a last will and testament, they’re preparing their estate to undergo the probate process. Probate is the legal process necessary for the courts to oversee the distribution of property after the owner dies.
First, the court will determine and locate the value of all remaining assets. The court will also cover any taxes and bills until everything is passed over to the right party.
Family wealth transfers will account for over $415 trillion in global wealth by 2030.
The probate process follows a specific set of inheritance laws. These laws often depend on residency. If a person dies without the existence of a will, the probate process will include laws for intestate succession instead.
Even without a will, probate will still include the distribution of assets. In these cases, the process can include selling inheritance property as well as paying bills.
Law Will and Testament
When someone dies with a will, the state law will likely require someone to file the will in the probate court as soon as possible. At the same time, the court will also process the petition or application to open probate of the estate.
In some cases, you’ll also need a death certification for this process, along with your application and the deceased’s will.
If your family member left a will, you’ll need to schedule a court hearing and have the will validated by a judge. Anyone listed as an inheritor in the will should receive notice of this court hearing. The hearing will give all parties an opportunity to make an objection regarding the probate process, too.
There are a few reasons someone might make an objection at these court hearings.
For example, someone might have an updated will. Maybe the will wasn’t drafted properly. Someone could also move to change the named executor before appointing someone else to handle the estate.
A decedent and witnesses will need to sign a self-proving affidavit before the court decides if the will is valid or not.
The deceased should have the self-proving affidavit signed at the same time the will and testament was signed and witnessed. If there isn’t an affidavit, you can also provide witnesses to sign a sworn statement. The statement will clarify that they saw the deceased sign the last will and testament.
Administrator or Executor
According to US inheritance law, a judge will need to appoint an executor. This party is often called a personal representative or an administrator. The executor will handle the process of probate.
They’re also responsible for settling the deceased’s estate.
Executors are sometimes appointed by the descendent if their name is noticed in the last will and testament. If a will doesn’t exist, the court will appoint next of kin as executor. This person is usually the decedent’s surviving spouse or oldest adult child.
A person can decline to become an executor. If that happens, it’s the court’s responsibility to appoint someone else. Once the executor is selected, they’ll receive letters testamentary from the court.
The letters testamentary are legal documents that permit the executor to act on behalf of the estate.
Finding the Assets
The executor’s first job is to find and take possession of all assets the deceased left behind. As executor, they’re responsible for protecting these assets during the process of probate.
To track down these assets, the executor might need to review documentation such as insurance policies and tax returns. If real estate is involved, the executor isn’t responsible for moving into the inheritance property to provide protection.
However, they are responsible for covering all mortgages, insurance, and taxes on the property.
The executor is allowed to take possession of other assets, such as jewelry and vehicles, for safekeeping. They’ll need to document these assets through investment accounts, bank accounts, stocks, and bonds.
The executor is also responsible for filing the deceased’s last personal income tax returns. In order to complete this process, they’ll need to determine if the estate is responsible for estate tax payments. If yes, they’ll need to file tax returns as well.
According to US inheritance laws, the executor will distribute what remains fo the assets after petitioning the court’s permission.
The court will only grant permission after the executor completes accounting, payments, and other transactions for the process of probate. In some cases, a will might name a minor as one of the beneficiaries or heir to the inheritance. In these cases, it’s the executor’s responsibility to prepare a trust for the minor.
For adults, the executor will need to file transfer documents and deeds with state or country officials to finalize bequests.
In some cases, you might experience inheritance disputes among inheritors. In these cases, it helps to have a practicing inheritance lawyer present. They can help navigate these disputes in order to simplify the process.
Intestate estate refers to an instance when a valid will isn’t present. In some cases, there’s an error in the existing will. Often times, however, a will was never made or an heir contested the existed will successfully.
The absence of a will usually means the deceased assets will get passed on to the closest next of kin. These cases can often cause emotional and financial issues. Again, having an experienced inheritance lawyer present can make these complicated situations much easier to navigate.
US Inheritance Law: Understanding the Complexities and Process
US inheritance law can sound tricky if you’re unfamiliar with the process. By requesting to have an inheritance lawyer present, you’ll have a professional’s expertise to guide you along the way.
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