When a loved one passes away, we have many questions about what to do. One of those questions is what to do with the estate, that is, what happens with the assets of the loved one. That process is called estate administration. The administration of a person’s estate begins after a person passes away; however, that doesn’t mean you must be in a lawyer’s office the moment after your loved one passes away. You do, however, need to be sure you see an attorney within a week or two after a love one passes away to review the estate and discuss next steps, to include beginning the formal estate administration process. NOTE: There are important date limitations as to filing for an estate, particularly if there is not a will, so you must talk with an attorney within one to two weeks of a loved one passing to preserve certain rights.
Estate Administration is a Legal Process
The estate administration refers to the process of managing and distributing the assets and affairs of a deceased person, known as the decedent. It involves settling the person’s financial obligations, ensuring that their assets are properly valued and distributed to the rightful beneficiaries or heirs, and handling any legal and administrative tasks associated with the estate.
The estate administration process typically begins with hiring an attorney, filing a petition to probate the estate, and then with the appointment of a personal representative (a/k/a executor), who is responsible for overseeing the administration of the estate. The personal representative may be named in the decedent’s last will and testament or appointed by a court if there is no will or designated personal representative.
Key Tasks in Estate Administration
The key tasks involved in estate administration include:
- Probate: There are different processes and tasks depending on whether the decedent died testate (with a will) or intestate (without a will). If the deceased person had a will, it is usually submitted to probate, which is a legal process that validates the will and ensures its proper execution. The probate court reviews the will, appoints the personal representative, and provides legal authority to administer the estate.
- Asset Inventory and Valuation: The personal representative identifies and gathers all the assets owned by the deceased person, such as real estate, bank accounts, investments, personal belongings, and debts owed to them. These assets are then appraised (formal or informal) or valued to determine their worth.
- Debt Settlement: The personal representative notifies creditors the estate is open and the right to file a claim against the estate, pays off the decedent’s debts and obligations using the assets from the estate. This may include mortgages, outstanding loans, credit cards, taxes, and any other liabilities. Discuss with your attorney before paying debts of a decedent.
- Distribution of Assets: Once all debts and expenses are settled, the remaining assets are distributed to the beneficiaries or heirs according to the decedent’s will or the applicable laws of intestacy in Alabama if there is no will.
- Estate Taxes: The personal representative is responsible for filing the necessary tax returns on behalf of the deceased person and the estate. This includes federal estate tax returns as well as income tax returns for the final year of the decedent’s life.
- Final Accounting and Closing: Once all the tasks are completed, the personal representative can file to close the estate.
Schedule Call for Next Steps
If a loved one has recently passed away and you need guidance on what next to do, call Tanya at Huntsville Estate Planning Lawyer, LLC or go www.huntsvilleestateplanninglawyers.com to schedule a free 30 minute virtual consult and talk with Tanya from the comfort of your own home.
