Probate Services & Trust Administration
When a person dies without a trust, and they own property or bank accounts, a judge must approve any transfers of the property or bank accounts to the people the deceased named in a will. If there is no will, the state law will decide who gets the property. The process of getting the judge’s approval is called “probate.”
If someone dies with a trust, probate is not required. Instead, the person named in the trust to handle the affairs is responsible for transferring the property. This process can be complicated, and we assist trustees in making sure they are handling the transfers properly.
If probate is required, we use these steps to transfer property:
1. Transfer property that does not require the judge’s signature.
In some situations, the judge does not need to approve the transfer of property. This happens when there is a co-owner listed on a bank account; a beneficiary listed on a life insurance policy; and even an owner in “joint tenancy” listed on the deed of a house.
2. Select the fastest and least complicated probate type available.
In Nevada, small estates (under $100,000) get expedited treatment in court. We will work with you to use this option if it is available and will be sufficient for transferring the property in a way that is not complicated. If the estate is over $100,000, (or if the estate is complicated, such as when two or more people will inherit one house) the court will appoint an executor.
3. Transfer property according to court order.
For small estates, it can take as little as six weeks for the judge to sign documents transferring property. For larger estates where an executor is appointed, there are more steps, but the end result is the same. The judge signs a document approving the transfer of property and releasing the executor from his or her duties.
What to Expect
Generally, the probate process works like this:
1. Opening of Probate. A request is made to open a probate case. If it is a larger estate, we also ask that you be appointed executor (if there are legal grounds for you to act as executor). The petitioning (requesting) party sends notice to the extended family of the deceased (or publishes notices in the newspaper if family members are out of touch).
2. Hearing to Appoint Executor. There is a hearing where the judge reviews the petition and if no one objects, prepares an order to appoint the executor. The judge does not call the case (require anyone to show up to the hearing) if he has not received a written objection in advance. If the estate is small, rather than appointing an executor, the judge will simply sign an order authorizing immediate transfer of the property. No further steps are required at that point for a small estate.
3. Inventory and Appraisal. The executor will provide information to us so we can prepare an inventory what is in the estate (a list of property and estimated value).
4. Payment of Debts and Settlement of Claims. Executor pays the debts of the estate including taxes and resolves any outstanding claims (like a credit card debt, utility bill, or outstanding loan) using funds that are in the estate. The Executor does not have to pay out of his or her own funds.
5. Final Accounting and Distribution. We prepare a final accounting of what came in and what went out of the estate, with a request to distribute what is left to the beneficiaries. If the judge approves it, the property can be distributed.
6. Close of Probate. Once the property is distributed, the beneficiaries sign receipts. We turn those receipts in to the judge so he can be sure everything was transferred properly. Then he will close the case and release the executor from any further duties.
FAQs
How long does trust administration take?
The time can vary. In a simple estate in which everyone is friendly with each other, a Trust that holds a house and a bank account can be resolved in three to four months, maybe a little longer if the Trustee decides to sell the house. If the family is fighting with each other, or if someone is living in the house and refuses to leave, the process can take as much as a year or more.
Does the trustee receive payment for his or her work?
Usually yes, unless the Trust Agreement prohibits the Trustee from receiving payment for his or her work. State law sets a percentage fee for the Trustee if the Trust does not specify the amount of payment. This is 4% of the first $100,000, 3% of the second $100,000, and 2% thereafter. In addition, if the Trustee does additional work such as cleaning out the house instead of hiring a service to do it, the Trustee can be paid a fair market rate for the time expended. The Trustee is also entitled to reimbursement for out of pocket expenses, such as if he or she made mortgage payments after the Decedent died and before the house was sold.
Does the trustee decide who gets trust property?
No, the Trustee does not decide who gets the trust property. This was already decided by the person who died, and the written instructions are in the Trust Agreement. If the Trustee does not abide by these instructions, the Trustee can be sued personally.
Are inheritances from a trust taxed?
Sometimes. When a person dies, their property has a dollar value. If the trust administration takes a long time, the property may increase in value. The difference between the value on the date of death and the distribution date may be taxable if the increase in value is more than the cost of the trust administration. Also, certain states have inheritance taxes (Nevada is not one). Also, if trust property exceeds the federal limit for taxes (currently $11 million for individuals), federal estate tax could be due.
What if the trustee does something wrong?
If the Trustee fails to act, overpays himself or herself, or refuses to distribute the trust property to the rightful beneficiaries, the beneficiaries can sue the Trustee. The Court will require the Trustee to account, and if the Court finds that the Trustee did something wrong, the Court may also remove the Trustee and can issue financial penalties.
FEES
Probate fees are set by statute. We do offer discounts for simple cases. The statutory fee is 4% of the first $100,000 in value, 3% for the next $100,000, and 2% thereafter. We do not take payment upfront in estates over $100,000; for those cases, we are paid at the end of the case, or, if the case exceeds more than one year, periodically if the estate has assets.
Trust matters are billed hourly at $300 per hour, and can range from a couple of hours for a small and simple estate, to several thousand dollars where beneficiaries are fighting and/or there are many properties that must be sold.