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Using a Will – What Your Loved Ones Need to Know about your Will

In Missouri, a will must be filed within one year of death with the Probate Court.  The court will require the original will be submitted, not just a copy.  Therefore, it is very important after you execute your will that you put the original document somewhere safe.  I would suggest a fire safe.  If you don’t already have one, a fire safe can be purchased fairly inexpensively at stores such as Walmart or online at Amazon.

It is also a good idea to provide a copy to those family or friends whom you have chosen to act as your Personal Representative or Successor Personal Representative.  You may also want to communicate with your loved ones where you keep this important document so that if they need to use it, they will be able to find it in a timely manner.

Did you know that if a will is not filed within one year of death, the will won’t determine who gets your assets?  If probate is not started before one year after the death of the person who made the will, then the Missouri intestacy laws will be used instead of the will.  This means the person’s heirs-at-law will be entitled to inherit from the estate instead of those individuals named in the will.  If one year has passed, a Determination of Heirship can be filed with the court to determine who is entitled to the assets.

Even if there was a will, it will not be followed because it would have had to have been filed within one year from the time of death to be effective.  This could mean that the decedent’s wishes will not be able to be met.  It is a good idea after a loved one passes to consult with an attorney who can help you navigate the process.  Timing is of importance due to the short statute of limitations placed on filing the will with the Probate Court.

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My dad just left a few small assets. Do I have to go through Probate?

If a person passes away leaving assets without beneficiary designations, there is a court process called Probate. Probate allows for a personal representative to be appointed by the court to access those assets and distribute them to those entitled to them.  Who is entitled to those assets will be determined by the deceased individual’s will.  If the deceased individual did not have a will, who is entitled to those assets is determined by the intestacy laws of the state where the deceased person resided at the time of their death.

In Missouri, whether the deceased person had a will or not, if the assets are less then $40,000.00 you may be able to avoid the longer, more costly probate process.  You may be able to file a small estate affidavit with the court.  This process is faster and less expensive then if a full probate is required.

For example, assume your dad had a retirement plan, life insurance policy, bank account, and a car when he passed.  If the retirement plan and life insurance policy had beneficiaries, the retirement account and life insurance would not need to go through probate.  Assets that have beneficiary designations can avoid probate.  However, your dad forgot to add beneficiaries when he got a new car and opened a new bank account.   If the car’s value and bank account total less than $40,000.00, you may be able to use a Small Estate Affidavit to access the bank account and car.

In addition, to the Small Estate Affidavit, the court may require additional information as well.  If there was a will you will need to provide the court with the original will.  You will also need a copy of the death certificate, information about the heirs and those named in the will if there is a will (may need full legal name, address, social security number, date of birth, and date of death if applicable), and proof of values of the assets.  For the car, the car title would be needed that would include the vehicle identification number and for the bank, a bank statement showing the account number and balance of account would be needed.

Different states have different laws and even different counties may have different rules and procedures, so it is always a good idea to meet with an attorney.  The attorney can help you determine what court procedure is needed in your situation and can help you navigate the process.  My husband’s uncle recently reached out to me because his father passed away and he was trying to fill out court documents that he had found online and had a few questions for me.  I don’t practice law in the state where his father passed away but just from asking him a few questions, I was able to determine he was trying to fill out forms for the wrong county and also had forms for the wrong court process.  I suggested that he contact a Probate attorney in the city where his father had passed.  Losing a loved one is stressful enough, an experienced attorney can help you navigate the legal process.

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A Time to Plan – Burkhardt Law Firm

As I sit and reflect on the last year, brainstorming for helpful topics, I’m left with one main thought.  It’s time to plan.  We’ve spent the last year much more isolated from friends and family, and, for many of us, faced with loss of loved ones or the reality of health issues.

This year, Burkhardt Law Firm has helped many families form plans and many people navigate probate when there was not a plan or when things fell through the cracks.  I’m always so grateful that our clients trust us with their loved ones and something that is rarely fun to discuss.  That being said, I see so many families put off making an estate plan.

One of the saddest moments in my job is when we have a client pass.  I hate losing someone I’ve come to know and learn about their lives and loved ones.  We’ve lost a few clients this year and my heart is truly with their friends and family.  And while losing a client is the sad part of my job, often it’s also rewarding in seeing those friends and family navigate the loss with grace and knowing that I made a difficult time easier.

On the other hand, we also get calls from potential clients’ families when they never took action and moved forward with an estate plan. This is truly the worst part of my job.  Telling someone, who is already suffering a loss, that we didn’t help the person who was passed.  Then that someone has to figure out what to do next.  Often, this involves probate.  And while I appreciate the trust in guiding someone through probate, I so wish we could have made a hard time easier by having helped with an estate plan.

My days are generally filled with conversations getting to know people and their loved ones.  I truly love my job, my clients, and my co-workers and am thankful for a different, but still great year.  I sincerely look forward to more of these conversations in 2021.  My wish for your and your loved ones is for a very Happy New Year.  And perhaps as part of that New Year, an estate plan or a update to your estate plan.

 

 

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My Parent Passed Away Without a Will – Burkhardt Law Firm

peterclavercenter.org/component/banners/click/7Last month we talked about the legal process about what happens if you do not have a will.  But what do you actually do when you lose a parent and they passed without a will?  How do you gain access to their assets and determine who should get them?

The first step is gathering a list of your parent’s assets, financial statements, and tax records.  Financial statements often indicate ownership of the account.  If an account has a joint owner listed or has a POD, payable on death, then that asset will transfer to the person named and will not need to be probated.  If you locate their car title it may also list a joint owner or a TOD, transfer on death.  Again, if a joint owner or TOD was listed, this asset would avoid probate and can be transferred without the probate court and without a will.

If all of the assets you locate have a joint owner or a beneficiary designation, you will not need to go through probate.  However, if you find assets that did not have a joint owner or a beneficiary designation, you may petition the court to open a probate estate to handle those assets.  In that situation the beneficiaries would be determined by the state intestate law of the state where your parent died or owned property.

If you will have to probate assets and you have siblings, you may want to try to agree on the person you want to be “in charge” of your parent’s estate. That person would be the one to hire an attorney and petition the court to open a probate estate.  You will want to hire an attorney that practices in the county and state where your parent died or where they owned property.  The attorney will be able to assist you in getting the court to appoint you as personal representative or administrator of the estate. Your attorney will be able to determine which probate process will be needed based on the circumstances. Keep in mind, that in some counties, only an attorney may file a petition with the probate court.

To open a probate case, you will need the full legal name, address, date of birth, and social security number of each of the heirs. Your attorney will also need to know what assets are to be probated and the value of those assets.  A copy of the death certificate will also be required when your attorney files the petition.  If you have all this information gathered when you meet with your attorney, it will help get the process started sooner. Once your attorney has met with you to determine which probate process is appropriate, they will be able to walk you through the rest of the probate process and let you know what to expect.

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When You Don’t Avoid Probate – Part 3 – The Worst-Case

Last month, we took a break from talking about probate to have a guest writer.  However, I want to tell you about the worst-case scenario of probate, or at least what I consider the worst-case scenario.  Before I get into specifics, I’m an attorney, I have to give a caveat:  Law is very fact dependent.  Probate cases can proceed in many different ways and require many different things depending on the specific case.  That being said, a full probate proceeding usually follows this generic procedure:

First, the people applying to be a Personal Representative has to apply for the Letters.  It can either be Letters of Administration if there is no will or Letters of Testamentary if there is a will.  As part of this process, the court requires the information I mentioned before.  If there is a will, the court requires the original will to be submitted.  Depending on the specific case, the heirs or beneficiaries involved may have several different forms to sign off.   These could include waiving bond and consenting to the Personal Representative being named, among others.

I also want to point out that notice has to go out to the legal heirs, not just the people listed in the will.  So this means if someone was disinherited, they get notice they were disinherited and have a court case already filed where they can contest the will.

Once the Letters have been approved, this court order will allow the Personal Representative to collect assets in the name of the estate.  From the estate account valid expenses of the personal who passed (burial, bills, taxes, etc.) can be paid.

After the Personal Representative has been appointed and received the Letters, the court requires an Inventory. This is just a list of assets that were held in the name of the person who passed.

Then after all of this initial work, there’s a waiting period.  Nothing really happens for about 6 months while the creditors have a period to file any claims.

After the creditor claims period, any claims can be negotiated.  Often times, we can set a hearing for the claims and the court will dismiss the claim if the creditor does not appear.  What this means is that I often will go to court, the estate will pay me for my time, but the claim does not need to be paid.

Once all of this has been taken care of, the Personal Representative can begin closing the estate.  To do this, they need to give notice to all of the people receiving money and an accounting (called the Settlement) of what has happened to the assets.  With the consent of everyone involved, some of these formalities can be waived.  They can then hand out the money and close the estate.

What this all comes down to is: The money that is supposed to go to the loved ones, ends up paying for court and legal fees.  Disinherited family have the opening to contest.  Creditors have the opportunity to get paid. The beneficiaries have to wait over (and at best) six months before receiving money.  All in all, a situation most people want to avoid.

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When You Don’t Avoid Probate (Pt. 2) – Your Options

So as I mentioned last month, I have been doing a lot of probate work recently.  And there I discussed what is needed to begin probate.  This month I want to discuss what the different probate options are.

The simplest option is the small estate affidavit.  The limitation is that you can only use a small estate affidavit if the total assets are under $40,000.  You also have to have proof of the assets and will not be an executor or personal representative. This means if you don’t know the assets, you cannot use a small estate. But if you know all the assets and they’re under $40,000, a small estate affidavit will result in a court order giving access to those assets. It’s a great option.

Another “easy” option is the determination of heirship. However,  this is only available a year after a person has died. It also requires a court hearing. And because a will has to be admitted into probate within a year of the death, you cannot use a will. The assets can only pass intestate.  At the end of the hearing, there is a court order showing who the heirs are who get the assets. So again, there will not be a personal representative to get access to unknown assets,  but it’s another simple option to get to assets.

However,  if the assets are over $40,000, you can’t wait a year, or if there’s an unknown and you need to gather information,  the only option is a full probate proceeding. A full probate process is what most people want to avoid with a proper estate plan for a few reasons.  First, it opens the assets to creditors and challenges.  Secondly, you’re paying attorney to handle it all.  And finally, in a simple case, it won’t be resolved for over six months and normally will take over a year to complete.  So while, it’s sometimes the only option, it’s the proceeding most people think of and want to avoid.

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When You Don’t Avoid Probate (Pt. 1) – What You Need

As I help clients form an estate plan, the main goal is normally to avoid probate.  There are different ways to do that, beneficiary designations or a trust, but sometimes it simply doesn’t happen.  More and more recently I have been hired to clean up those times when a person hasn’t properly planned.

When a new probate client comes in, there’s a few things that we need to figure out to determine how probate will work:

The assets – Only assets that do not have a beneficiary or owner will go through probate.  So, if a life insurance policy has a beneficiary, it does not need to go through probate.  Or if a bank account has another person listed as an owner (but please don’t DIY plan this way), it does not need to go through probate.  So the first step, is to figure out which assets need to go through probate and the approximate value.

The heirs/devisees – I also need to know about the family left behind.  The court will need to know who the heirs are and if there was a will, who was entitled under the will.  For all these people, I need legal names, addresses, dates of birth, and, if possible, social security numbers.

The death certificate – Where a person lived and when they passed determine which court and which probate process will be used.

As you can see, it’s not a long list of things of things that I need.  However, gathering the information can be difficult.  Even just getting an approximate value of the assets can be hard, because when a person passes most companies will not give out that information until probate has begun.   But this is just the first step to beginning the probate process, next month I’ll explain those processes and how they each work.  From there, I’ll tell you the drawbacks to each and why it’s just best to avoid probate from the start!

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A New Year’s Resolution – Don’t Wait to Plan

A New Year’s Resolution – Don’t Wait

We have had the wonderful privilege of being extremely busy since I have returned from maternity leave.  I feel extremely lucky and blessed that my clients and those who refer me trust me enough that we had a great 2018 and are looking forward to a full and eventful 2019.  So, thank you to all who read this for your continued faith and trust in me.

However, I do have a bit of a request.  As we enter 2019, if you hear someone talking about a will or power of attorney, any estate plan, with the phrase “We’ve been meaning to do that…” or anything similar, please interrupt.  Now, estate planning is my business, so of course, it’s a bit self-serving.  But that really isn’t the reason.  I’ve had many acquaintances over the years who haven’t used me for one reason or another, and I understand when that happens.  A person can be too close.  But even when I’ve been told a potential client has had their plan done elsewhere, I thank them for getting it done.  Because it can be too late to plan.

I’ve helped a lot of families form a plan to avoid probate, but this year we’ve also helped many loved ones grieving sort through when a plan wasn’t in place.  And I’ll be honest, I prefer the planning in advance.  Many times, probate is simple, a few months, everyone getting along, and a magic court order that gives easy access.  I try to help it work this way any opportunity I can.  That, of course, isn’t all the time.  If there are people who need access to funds immediately, families that are more complicated, or just small assets spread everywhere, it can make probate a nightmare.  Unfortunately, I also have had to tell many families that with the amount of work (and legal fees) involved, probate just wouldn’t be worth it.

There’s also the call I get on a regular basis, where a loved one wants to help get a person a power of attorney, but there’s a question of capacity.  Sometimes, we’re able to proceed, but more often then not, it’s too late.  In that situation, the only way to access accounts would be to go to the court and petition for a conservatorship.

I hate those calls where I am the one breaking the news that court is the only way and often not a practical way because of the legal fees.  It’s terrible for me, and I’m not the one dealing with the situation.  So, do me a favor this year, and if you hear anyone making a resolution to get their estate plan encourage them not to wait!

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Don’t Forget…. To Title Your Assets!

I meet with most of my estate planning clients three times and in each of those meetings I (try to) emphasize that an estate plan is truly controlled by how assets are titled. Of course the legal documents are important, I wouldn’t have a job if they weren’t. But the documents I create don’t mean anything unless we know how the assets are titled.

This is because it is really how an asset is titled that determines where the asset goes and if it will have to go through probate.

If there is a co-owner with a right of survivorship (this is generally called Joint Tenants with Right of Survivorship or JTWROS), then the property passes to the co-owner. This is also where trusts fall. In order for the trust to control, the title must be in the name of the trust and the trust must be the owner. The new owner under this ownership will have control and ownership completely outside of probate.

If there isn’t a trust as the owner or there isn’t a co-owner, then you look to see if there are beneficiaries. If there are beneficiaries, then they then own the property. And when I say beneficiaries, I also include Transfers on Death (TODs) and Payable on Death (PODs) designations. Again, these beneficiaries take ownership without probate.

It is only after ownership or beneficiaries that a will would control. If there are no co-owners and no beneficiaries, then whomever would get the property under the will is the new owner. However, a will must go through probate to transfer the property to the new owner.

And finally, if there are no co-owners, no beneficiaries, and no will, then intestate law controls and heirs get the asset. But again, the heirs would have to go through probate to gain access to the asset.

So, do me a favor, if you or a loved one has assets you’re worried about going through probate, CHECK HOW THEY’RE TITLED!

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Managing the Loss of a Loved One: Legal Steps to Consider

After the loss of a loved one, there’s so many things to manage: emotions, family, expenses. It can be absolutely overwhelming just knowing where to start.

While the loss can be overwhelming, there’s very few things that need to happen quickly. The more important aspect is to handle things efficiently and take the time to grieve. When ready these tips are good items to begin with:

1 – Don’t Touch Money without Knowing the Consequence

Most inheritances do not have a tax consequence. But do you know which do? There could be a tax consequence (especially with the potential tax reforms) you aren’t sure about. So, before you take money out of an account, it’s really important to know if there will be a tax consequence. I would strongly recommend talking to a licensed financial advisor before moving money around. Specifically, retirement money can have tax consequences and those should always be determined before moving it.

2 – Don’t Pay Unnecessary Bills (unless you want to)

In most circumstances, you are not responsible for the debts of a person who has passed. So, unless you want to (and some people do), it’s not necessary to pay all of your loved one’s bills. However, any assets that you will be keeping (house, car, etc.), you should continue to pay. This would include loans, utilities, and insurance among others. Also, if your name is on the debt, credit cards for instance, you will be personal responsible for the bill and you should pay that debt.

3 – Tax Filings and Advice

There will often be an income tax return to file and could be money from retirement accounts that will require tax advice. Because there are strict deadlines with tax filings and the transfer of taxable money, a licensed CPA should be a priority in those first few weeks.

4 – Accessing Assets

Before knowing how to access a specific account or asset, you must know they exist. So the first step is making a list of all the assets. A bank statement is a great place to start. It will show any incoming money and outgoing expenses which may provide insight on where assets are. Any type of statements you can find are going to be very helpful.

The next question then is how do you access these accounts and assets. The simple answer is the holding company will tell you. Hopefully, it’s as simple as a death certificate. More often it’s a court order. If you are told you need a small estate affidavit, letters of administration, or letters of testamentary, it’s time for probate and if you’re in St. Louis County that means starting with an attorney.

5 – The Will

If there is a will, the will must be admitted into court within one year of the date of death. This means it really isn’t something that needs to be addressed quickly. However, if you have not found yourself in need of probate within the first several months, it should be a priority to admit it into probate court within that first year. If the will is not admitted, even if it is “filed” with the court, within that first year, it will no longer control.

Hopefully this list is a helpful place to get started. Remember, very few things take priority over mourning and family and loss, but we’re here to help as you need it.

Burkhardt Law Firm

Phone: (314) 518-1581
Email: mburkhardt@burkhardtlaw.com
Address:
2333 Grissom Dr., Suite 107
St. Louis, MO 63146