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Probate Basics
 
When a person dies, any property that does not automatically pass to somebody else must go through probate. This includes property that is left to survivors in a will.
 
Will My Estate Have To Go Through Probate?  
  
The following types of property generally do not need to be probated:
  • property owned jointly with right of survivorship
  • property with transfer-on-death deeds
  • life insurance proceeds
  • bank accounts with payable on death (POD) provisions
  • any property that has a named beneficiary, such as a retirement account
  • property held in a trust
Although the property may not have to be probated, the value of all property you owned at the time of death is used to determine if your estate owes taxes.
If you die owning property that does not automatically pass to your survivors, a probate must be started to handle your estate. This is true whether you die with a will or without one.
 
Usually, the person named in the will as the Personal Representative (or Executor) starts the probate. If you die without a will, anyone with an interest in your estate may petition to start probate proceedings.
 
What Is Probate For?
 
Probate is designed to serve several purposes, including:
  • appointing someone to be in charge of handling the estate
  • identifying people and organizations who may be entitled to inherit
  • determining whether a will is valid
  • giving creditors an opportunity to come forward with claims
  • conducting an inventory of the property in the estate
  • ensuring that all taxes are paid
  • distributing the property to those entitled to inherit
How Bad Is Probate?  
 
Believe it or not, probate is not all bad. Here are some positive and negative aspects of going through probate.
 
Pros:
  • Creditors only have a limited amount of time to come forward with claims. After that time, most creditors cannot collect on money owed by the deceased person
  • The process is court-supervised, so there is some oversight over the person handling the estate
  • A will is cheaper and easier to do than a revocable trust
Cons:
  • Generally you do need an attorney
  • Court filings are public record, so anyone can see how much the person had when he or she died and who inherited from the estate
  • It may be easier for someone to challenge a will than a trust.
Starting Probate   
 
Many people believe that probate takes years and costs thousands of dollars. The truth is that most estates can be probated in just a few months. Below are the steps of a basic probate.
 
Filing a Petition
 
The first step is to file a petition with the district court located in the county where the deceased person lived at the time of his or her death. If there is a will, the original is filed along with the petition. The petition asks the court to accept the will (if any) and appoint a person to handle to probate.
 
Notice of the petition must be sent to anyone who may be entitled to inherit. It must also be published in a local newspaper. A hearing will be held at which time the judge will decide whether to accept the will, appoint someone to handle the estate, and determine who is entitled to inherit.
 
Conducting an Inventory
 
The person handling the estate (called the Executor, Personal Representative, or Administrator) must make an inventory of all of the property in the estate. This includes the value of all real property (e.g., house, land) and personal property (e.g., bank accounts, possessions).
 
Giving Creditors Notice
 
The person handling the estate must also give creditors the opportunity to come forward with claims against the estate. Known creditors must be sent notice by mail. Notice is also published in a local newspaper to let others know that they must come forward with any claims of money owed. Creditors only have a certain amount of time to come forward (one month or two months, depending on the size of the estate). After that time, no one can claim the deceased person owed them any money.
 
If creditors do submit claims, the person handling the estate must determine whether or not the claims are valid. Any valid claims are then paid out of the estate. The person handling the estate is NOT personally responsible for paying any debts.
 
Filing Tax Returns
 
Generally, most estates are not large enough to owe estate taxes. Nevertheless, an estate tax return must be filed with the Oklahoma Tax Commission. For larger estates, a return may need to be filed with the IRS as well.
 
The Oklahoma Tax Commission will make sure that the person did not owe any taxes at the time of his or her death. If no money is owed, the Commission will send a letter stating that no taxes are owed.
 
Closing the Estate
 
Once all the requirements are met and debts are paid, the rest of the property in the estate can be distributed to those who are inheriting.
 
How Do I Avoid Probate?  
 
Even though probate is usually not too bad, some people would prefer to avoid having their estates probated. Common strategies used to avoid probate include: