Probate

As a Grand Rapids estate planning attorney, I help my clients avoid the delays and cost of probate. If probate is unavoidable, I can help walk you through the probate process.

What is Probate? Probate is a court oversight process to determine who will inherit your assets – and if applicable: (a) appoint who will care for your minor children (Guardian); (b) appoint who will oversee their finances (Conservator).

When is Probate Required? Probate applies if you don’t have a will or if your assets exceed a threshold amount (which is quite low).

Types of Probate: Michigan has four probate avenues:

  1. Small Estate: if your total non-exempt assets (after paying for burial and funeral costs) is less than $22,000, you can use the Small Estate process. It is quite simple and merely requires the filing of Form PC 556.
  2. Medium Estate: if you are survived by your spouse and/or minor children and your total non-exempt assets (after paying for burial, funeral, last illness and administration costs) is less than approximately $55,000 (there is a specified formula based upon types of assets), you can use the Medium Estate process. It is quite simple and merely requires the filing of Form PC 556.
  3. Unsupervised Regular Probate: the personal representative is permitted to close the estate without court supervision unless the personal representative requests the court’s assistance or an interested party (usually a creditor or beneficiary) requests court intervention. The minimum time to close your estate using this avenue is 5 months.
  4. Supervised Regular Probate: the court reviews and approves the estate activities. This is required for estates where: (a) real estate will be sold; (b) fees will be paid to an attorney or personal representative; or (c) distributions will be made to beneficiaries.

Assets Exempt from Probate: Items “exempt” from probate include:


Living Trust assets
These are the assets that are in a living trust


Jointly owned Assets
If the asset passes automatically to the surviving owner – which means it is owned by at least 2 people and the first to die gives their interest to the survivor(s). This includes:
Joint tenancy with right to survivorship – available for real estate, stock, bonds, mortgages and other forms of indebtedness. Tenancy by the Entirety – available only to married couples (in Michigan this only applies to real estate)


Life Insurance
If the insurance policy has a designated beneficiary – which means, when the person dies, the policy’s proceeds have been designated to be paid to a specified person or entity.


Retirement Plans
Such as an IRA, 401k, pension benefit, social security, etc.


Bank Accounts
If the account has a designated “payable on death” (POD) beneficiary or “transfer on death” (TOD) beneficiary.


Cash
Up to $500.


Travelers checks
Most issuing companies will redeem travelers checks without an order of the court.


Unpaid Wages
From a Michigan employer. This also includes fringe benefits.


Income tax refunds
Both federal and state.


Motor Vehicles
If the total value of all vehicles does not exceed $60,000.


Watercraft
If the total value of all watercraft does not exceed $100,000.


Personal property
Up to $15,000.


Wearing Apparel
If the apparel is held by a hospital, convalescent or nursing home, morgue or law enforcement agency.


All other assets will be subject to probate if the total assets non-exempt assets exceed $22,000.

What does the Court do?

If probate is necessary, as a Grand Rapids estate planning lawyer, I can help walk you through the probate process. What happens in the probate process?

1. Guardians – the probate court will appoint who the Guardian(s) will be to raise your minor children (or care for your incapacitated adult children). If you have a will nominating Guardians, in almost all instances, the court will honor your wishes by appointing the person you nominated. If you don’t have a will, the court will appoint a Guardian based upon what is in the “best interests of the child”.

2. Conservator – the probate court will appoint the Conservator who will oversee the assets available for your minor children (or incapacitated adult children). These assets will include: (a) assets the children owned before your death; (b) assets inherited through your will; or (c) if there is no provision in your will, then according to statutory inheritance rules (called Intestate Succession). If you have a will nominating a Conservator, in almost all instances, the court will honor your wishes by appointing the person you nominated in your will. If you don’t have a will, the court will appoint a Conservator based upon what is in the “best interests of the child”.

3. Personal Representative – the probate court will appoint your Personal Representative who will wrap up your estate according to the terms of your will or, if you don’t have a will, then according to law. If you have a will nominating a Personal Representative, in almost all instances, the court will honor your wishes by appointing the person you nominated in your will. If you don’t have a will, the court will appoint the Personal Representative.

4. Asset Distribution – the probate court will transfer legal title for your estate assets: (a) to the beneficiaries designated in your will or; (b) if you don’t have will, then to the inheritors who will take the assets by statutory inheritance rules (called Intestate Succession).


Questions? Ready to get started?

Call me. 616.498.5112

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