Administering an estate is an important responsibility. For that reason, both estate planners and their families should be familiar with the process of how an estate is administered. Understanding how an estate is administered can help estate planners develop an estate plan with that process in mind.
Steps in the process of administering an estate
During the probate process, generally some basic paperwork will need to be filed, the court will appoint someone to administer the estate which can be the personal representative designated in the estate planner’s will; the estate planner’s property will be inventoried; debts of the estate will be paid; assets of the estate will be distributed; and typically the court will approve the distribution as part of the process.
Inventorying the estate
The personal representative will need to inventory and document all of the estate planner’s assets. The process is commonly referred to as inventorying the estate. The personal representative should also notify creditors of the estate and pay them if the probate assets of the estate are sufficient to do so. If the probate assets are insufficient to repay creditors, the personal representative may need court approval to determine how creditors are repaid.
Distributing the estate
Remaining assets of the estate after creditors are repaid are then distributed according to the estate planner’s will. Additionally, the personal representative should also prepare any necessary tax returns and defend against any probate disputes.
Administering an estate is an important process. To ensure it goes well, and as the estate planner intends so that their family and loved ones are taken care of how they anticipate, it is helpful to understand the process.