“Question of the Month” is a new addition to our blog that will help answer common questions that Disability Planning Partners often receives from clients and prospective clients. We hope these posts will assist everyone seeking answers to common estate, disability, and elder law questions, helping point them in the right direction.
For the inaugural post, we’re starting with the most common question I get—one that can either make the probate process run smoothly or turn it into a disaster: How to administer an estate.
Terminology
To start, here are some common terms you should know about the people involved in an estate:
- Decedent: The person who has passed away.
- Executor/Executrix: The person named in the decedent’s will to manage their estate.
- Administrator: If the decedent did not have a will, a spouse, child, or related family member can apply to the probate court to serve as the administrator of the estate. The administrator performs the same role as the executor; the only difference is that we use the term “administrator” when there is no will.
- Fiduciary: Once the court officially appoints the executor or administrator, that person is also referred to as the fiduciary of the estate.
Overview of the Probate Process
When someone passes away, their estate must be opened with the local probate court, which is in the jurisdiction where the decedent resided at the time of their death.
The probate process, in a nutshell, involves:
1. Appointing someone to manage the estate (either the executor named in the will or the proposed administrator).
2. Creating an inventory of all the decedent’s assets.
3. Sending notice to creditors (handled by the court).
4. Waiting for creditors to come forward.
5. Asking the court to approve the distribution of the decedent’s assets, either according to their will or, if there is no will, under the laws of intestacy.
6. Closing the estate.
This is an extremely condensed version of what happens and is meant to provide only a general overview.
Duties of a Fiduciary
The fiduciary has several legal duties under Connecticut law. Below, we focus on the practical aspects of what the role entails:
1. Inventory and Valuation: The fiduciary must create an inventory of all the decedent’s assets and determine their value as of the date of death. It is important to note whether each asset was owned solely or jointly, or if there were beneficiaries listed.
2. Opening an Estate Account: The fiduciary should open an estate account at a local bank. All of the decedent’s liquid assets—such as checking and savings accounts, cash, and income—should be moved into this account. Funds in the estate account will be used to pay estate expenses, including probate court fees, attorney fees, and other costs like property upkeep.
3. Property Management: If the decedent owned a home in their sole name, the fiduciary must secure the property and ensure essential bills (e.g., water, gas, electric, and insurance) are paid.
4. Other Assets: Stocks, bonds, retirement accounts, and other financial assets should be valued and listed in the inventory. Physical assets of value, such as art or jewelry, should be appraised by a professional if necessary.
5. Recordkeeping: The fiduciary should maintain accurate records of all assets, debts, and expenses paid on behalf of the estate. Using a tool like an Excel spreadsheet can be helpful to track what the expense was, who paid it, how much it cost, and the date of the transaction.
6. Notifying Creditors: The fiduciary should inform creditors, such as credit card companies, of the decedent’s passing.
Filing and Timelines
Once probate has begun, there are many documents that must be filed with the probate court and strict timelines that must be followed. To ensure everything is handled correctly, it’s a good idea for the fiduciary to hire an attorney experienced in the probate process.
Complexity of Estate Administration
This is only a very basic outline of how to administer a standard estate. Probate can vary significantly depending on the size and complexity of the estate, family dynamics, provisions in the will, and the nature of the decedent’s assets. These factors can make the fiduciary’s job much more complicated.
Final Thoughts
A few parting tips for anyone administering an estate:
- Keep accurate and detailed records of everything.
- Avoid commingling estate funds with personal funds.
- Use a single account to pay all estate expenses whenever possible.
Disability Planning Partners would love to help guide you through the probate process and relieve some of the stress and burden from you and your family. Call us today!
