OK, I've got a question for this board. I've heard and read so many people talk about how important it is to have a trust so you can avoid probate. Can somebody explain what's the big deal about probate?When my Mom died in New Jersey, I was the only heir and executor. She had a will. I took it to the county courthouse to be probated. It was explained that “to probate” means to have it legally approved and judged to be legal. And it takes 10 days.Keep in mind that her estate was below the (then) $600,000 federal estate tax limit.After 10 days, I got a bunch of death certificates that would be required by banks, businesses, etc. for their records when I closed out her accounts. This whole deal cost about $35.With these death certificates in hand, I had no trouble closing out bank accounts, CD's, which, by the way are NOT subject to early withdrawal penalties in the event of death, and everything else. So what's the big deal?I can see doing some fancy footwork if your estate is over the federal estate tax limits but I know people who went to a lawyer to set up a trust. They have a $130,000 house and maybe $50,000 in the bank.I'm hoping this is the right board to post on. The Fool sure has a lot of boards and I'm sure there's some overlap. If there's better one, I can cross-reference.TIA.Andy
I've heard and read so many people talk about how important it is to have a trust so you can avoid probate. Can somebody explain what's the big deal about probate?Definition: the action or process of proving before a competent judicial authority that a document offered for official recognition and registration as the last will and testament of a deceased person is genuine b : the judicial determination of the validity of a willThe way I understand it is that you can't avoid probate court, but a will can make probate painless and fast. If there is no will, then the probate court has to decide who gets what. If there is a will, then the probate court is more of a formality to verify that the will is legal and that noone is protesting the will.To my knowledge, probate court has nothing to do with closing accounts, death certificates or taxes (tho I could be wrong) - it is just the legality of verifying a will or overseeing the estate if there is no will.You might want to cross-reference your post at the "Death and Grieving" board (http://boards.fool.com/Messages.asp?mid=16790683&bid=115805) - there appears to be more people following there...Jennifer
Thanks for the reply, Jennifer.To my knowledge, probate court has nothing to do with closing accounts, death certificates or taxes (tho I could be wrong) - it is just the legality of verifying a will or overseeing the estate if there is no will.That's my understanding as well. But once the will has been probated, they give you the papers that enable you to do all the rest.I'll post over on the D&G board too.Andy
I believe probate can be avoided when there is a will.
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