When someone passes away, the person named as the personal representative under the deceased’s will is required to follow certain procedures. Those procedures include providing notice to creditors, paying debts in a certain order and distributing remaining assets to beneficiaries. We find that the following 7 questions arise frequently from someone initiating the probate process:
1. Do we need to go through probate if the will is valid and not being contested? Yes. In Maryland in order for the assets to properly transfer to the named beneficiaries, they must go through the entire probate process. All assets must be inventoried and the court will approve the final distribution of assets to ensure compliance with the will’s instructions.
2. How does the probate process work? The personal representative named in the will starts by opening an estate file with the court. The court then issues letters of administration allowing the personal representative to perform all needed functions to effectively administer the estate. The personal representative will file an inventory (which will have to be updated and refiled every six months while the estate file remains open). These inventories report to the court all assets, income and expenses of the estate.
3. What is a personal representative? The personal representative is either named in the will or appointed by the court to administer a decedent’s estate. The main responsibility is to manage and preserve all assets and income pending the final distribution according to the terms of the will. Once the final distribution is made and approved by the court, the estate file may be closed.
4. What are letters of administration? Letters of administration are an order from the court allowing the personal representative access to the decedent’s assets. This access is required to properly administer the estate. The personal representative can use the letters of administration at financial institutions to obtain financial records of the decedent.
5. What are probate assets? Probate assets are those that are required to go through the probate process because they are solely in the decedent’s name. Some assets have beneficiary designations or payable on death instructions that allow them to be distributed outside the probate process. These types of non-probate assets include life insurance proceeds, annuities, POD bank accounts and retirement accounts. Certain types of jointly held real estate would also qualify as non-probate.
6. What is an estate accounting? An estate accounting is a document that needs to be filed with the probate court that lists all assets, income and expenses of the estate. In Maryland, once an estate is open the first estate accounting is due within 9 months, but follow-up accountings must be made every six months thereafter until the estate is closed.
7. Who pays for the estate attorney? In most cases, the personal representative is going to need the guidance and expertise of a seasoned probate attorney. The attorneys’ fees may be paid out of the estate itself and not be incurred out of pocket to the named personal representative. These legal fees are considered an expense of the estate and must be reported on the estate accounting.
If you are entering into an unknown world of Maryland probate and need the assistance of experienced and compassionate probate attorneys, contact Stouffer Legal in the Greater Baltimore area for a consultation. You can schedule an appointment by calling us at (443) 470-3599 or emailing us at office@stoufferlegal.com.
