If you stop to consider the subject of estate planning, you are probably going to think about the execution of documents that facilitate asset transfers like wills and trusts. Without question, you do have to create legal devices when you plan your estate, but the estate administration process is also part of the equation.
There are business and legal oriented tasks that must be completed after you are gone to bring your wishes to fruition. This is the estate administration process, and the circumstances will vary depending on certain factors.
If you utilize a last will to facilitate the distribution of your assets, you nominate an executor to act as the estate administrator. After your passing, the executor would not be able to act independently. The will would be admitted to probate, and the probate court would supervise the administration of the estate.
What is this process all about? First of all, there is a proving of the will. The court examines the will to make sure that it is in fact valid in the eyes of the law.
In addition to the heirs that are named in the will, there can be other parties who have an interest in the estate. The executor must notify creditors about the passing of the decedent so that final debts can be paid. These final debts would include any outstanding taxes that may be due and payable.
The executor will identify and inventory the assets that comprise the estate, and these resources will be prepared for distribution to the heirs. Appraisals and liquidation of property may be necessary, and this can be time-consuming depending on the situation.
Once all of the estate administration tasks have been completed, and the probate court closes estate, the heirs receive their inheritances.
This is a basic overview, but you can learn a great deal more if you download our in-depth special report on the probate process and the role of the executor. This report can be accessed through this website, and there is no charge, so you can obtain some excellent information for free.
To obtain your copy of the report, click this link and follow the simple instructions: Free Report on the Probate Process.
A last will is not your only estate planning option. There are somewhat advanced trusts that are used by people with very specific estate planning goals like tax efficiency and asset protection.
You could also use a trust to avoid the drawbacks of probate. A very popular type of trust that can be used to facilitate asset transfers to your loved ones outside of probate is the revocable living trust.
With a revocable living trust, the trustee is the trust administrator. When you establish a living trust you can act as trustee while you are living. You name a successor trustee to take over the trust administration tasks after you are gone.
After your passing, the successor trustee would distribute assets to the beneficiaries according to your wishes, and the probate court would not be involved.
We also have a free special report on the process of living trust administration, and you can visit this page to get your copy: Trust Administration Report.