Probate is a legal process whereby a court oversees the distribution of assets left by a deceased person. Assets are anything a person owns with value, such as real and personal property and cash, for instance.
Probate is not always necessary. If the deceased person owned assets with a spouse, the surviving co-owner often will then own that property automatically. If a person dies leaving very few assets, these items can be distributed among the rightful beneficiaries without court involvement.
In some cases, probate is needed for purposes of title clearing, debt collection, disputes between people who claim they are entitled to the deceased’s assets or for resolve of any will validity disputes.
If the deceased person had a will, the will is “proved” and delivered to the court. A personal representative is selected (someone who handles the affairs of the deceased). If the will does not name a representative, or there is not a will in place, the court will select a personal representative. (usually the spouse, adult child, or another close relative.) If the previously stated are not willing or not able to accept responsibility, the court may choose a bank or trust company.
Any debts are paid from the trust and notices are sent to any creditors through a publication in a local newspaper, and by the personal representative. Creditors have 4 months to bring any claim against the estate for fulfillment. Creditors must be repaid before any remaining assets can be distributed to the beneficiaries.
Heirs are listed, assets are identified and catalogued, and filed with the court by the personal representative. Dependent upon many variables, this step can be quite straightforward — or more difficult and time consuming.
The personal representative prepares state and/or federal tax returns and any inheritance, gift and estate tax returns and pays any taxes due.
Oregon allows an abbreviated procedure for handling small estates that would otherwise require a full probate. If an estate fits in this category, the cost and time for distributing the estate assets may be greatly reduced. The procedure involves filing a document called an “affidavit of claiming successor.” This abbreviated procedure can be used if the estate’s personal property is valued at no more than $75,000 and real property is valued at no more than $200,000, for a total aggregate estate value of no more than $275,000. (These rates are accurate as of April 2018, but can be changed by the state legislature. Please see an attorney or advisor to ensure that they are still accurate.) Real property includes land and buildings or structures placed on land, such as houses, commercial buildings and agricultural buildings. Personal property includes all other property, such as cars, boats, clothing, stocks, bonds and personal items.
Under Oregon law, a personal representative is entitled to a fixed percentage of the value of the total estate. Extra costs may be approved by the court for the personal representative and a lawyer if the estate is complicated. Other costs include court filing fees, legal notices published in the local newspaper and any other necessary expenses. Lawyers generally charge an hourly rate for their services.
The process(es) of probate can require a substantial amount of paperwork that needs to be filed within required deadlines and in a timely matter. To achieve the goals you have for yourself and your family, a probate lawyer can help you understand the complex issues which can arise from a probate matter, including tax legalities and other issues. An experienced probate attorney can also assist you in the preparation and filing of the legal documents, and can prepare you should you need to appear in court.
(Information compiled from Legal Editor: Don Johnson, April 2018: Oregon State Bar)