For those who haven’t gone through the probate process before, the estate planning world can be a confusing and difficult place to navigate. The estate planning and probate or estate administration process have significant differences, and it’s vital to understand each of these differences in order for either process to go as smoothly as possible.
Understanding the Estate Planning Process
The main goal of estate planning is to clearly make it known what you’d like to happen to your assets after you’ve passed away. Estate planning can also protect you and your assets should you become incapacitated and unable to manage your affairs independently. When creating an estate plan, the first step is to work with an attorney who can help you conduct a comprehensive review of the assets in your estate. Your estate includes all of the different types of property that you own, including the following:
- Retirement accounts
- Any other personal or real property you own
After reviewing the assets in your estate, your estate planning attorney will ask you questions about your goals. Perhaps you have an adult child with special needs. In that case, your attorney can help you create a special needs trust to protect your loved one’s eligibility for important public benefits, including MassHealth and Medicare.
You may own a family business and need to create a succession plan to ensure your business survives after you are no longer there. Whether you already have a clear idea of what you’d like your estate plan to include or need some help clarifying your goals, we can help you navigate the process smoothly.
Basic Estate Planning Documents
After you and your attorney have a clear idea of the assets in your estate and your goals for distributing your property, your attorney will begin working on important estate planning documents. Each estate planning document is important on its own, but together they will ensure your final wishes are respected. Your attorney can help you decide whether a will-based or trust-based estate plan will work best for your goals.
A will is a legal document that states your wishes for distributing your property and other assets after you pass away. When a person dies with a valid will in place, the probate court will distribute his or her property according to the terms in the will. A trust is a fiduciary agreement that allows you to protect assets for the benefit of the beneficiary you choose. When creating a trust, you appoint a trustee to manage the assets in the trust for the beneficiary. Estate plans should also include powers of attorney, an advance health care directive, and guardianship directives for parents of minor children.
What Does Estate Administration Mean?
The estate administration process happens after a person passes away. The estate administration will look differently depending on whether the deceased individual created a will or not. During the estate administration process, interested parties, creditors, and beneficiaries will have an opportunity to make a claim against the estate.
The probate court ensures that the decedent’s estate has been properly administered. When the deceased passes away with a will, the court will ensure that the will is valid and then distribute property according to the directives in the will. However, when a person dies without a will or trust, also called dying intestate, the probate court will distribute his or her estate according to Massachusetts intestacy laws.
Steps Involved in Administering an Estate
When creating a will, a person can appoint a personal representative who will oversee the estate administration process. When there is no will, or the personal representative isn’t willing or able to serve, the probate court will appoint a personal representative who will take responsibility for administering the estate. Before the probate court distributes the estate assets, the deceased person’s expenses and debts need to be paid. The personal representative will:
- Collect and take an inventory of the deceased person’s assets, and keep them safe
- Manage and protect the estate assets
- Pay valid taxes and debts that the estate owes, and
- Distribute the remaining property according to the will
If there is no will, the personal representative must distribute assets according to Massachusetts intestacy laws. The deceased person’s surviving spouse and children will inherit first. When there is no spouse or child, the law sets forth other relatives who have a right to inherit the deceased person’s estate.
The Difference Between Estate Administration and Trust Administration
The beneficiaries do not need to go through the probate court process with a trust-based estate plan. Instead, the trustees need to administer the trust outside the probate court. The trust administration process will vary depending on the type of trust involved. In the case of revocable living trusts, the trust will become irrevocable when a creator dies.
Once a Notice of Trust has been filed in probate court, the trustee can begin administering the trust. Administering a trust is less formal than estate administration in the probate court, which is more involved. The probate court has more direct oversight than a trust administration. The trustee must distribute the assets in the trust according to the terms of the trust agreement.
In some cases, trustees have the authority to quickly transfer trust assets to the beneficiary after the death of the trust creator. When it comes to trust administration, only the trustees and beneficiaries are involved. Trustees must act in the best interest of the beneficiaries, and when they fail to do so, beneficiaries can bring a breach of fiduciary duty claim against the trustee.
We Are Here To Answer Your Estate Planning Questions
At Surprenant & Beneski, PC, our award-winning attorneys offer clients comprehensive estate planning services. We help clients create comprehensive estate plans and represent clients in estate administration matters. You don’t have to navigate the estate planning process alone. Whatever estate planning issue you’re facing, our empathetic and experienced attorneys will carefully listen to you and help you understand your options. Contact us today to schedule a consultation and learn more about our estate planning law firm.