There’s a lot that goes into estate planning than people think. There are wills, trusts, debt collections, plus the probate process—which can be long and drawn out for several reasons.
While the importance of estate planning should not go unmentioned, it is discussed whether or not an estate can be probated without a will. It’s also essential to talk about how that process works should you find yourself dealing with the probate process of a loved one’s estate without a will.
In this article, we will talk about whether or not you can probate an estate without a will. And, Of course, that includes everything else you need to know about passing on without a will, also referred to as dying intestate.
Read on to learn more.
What Exactly Is a Probate?
Obviously, the first thing you need to understand about the probate process is its very definition.
Probate essentially involves proving to the court that the deceased individual’s will is valid. It also involves identifying the inventory within the deceased individual’s estate, having that inventory and any property professionally appraised, paying the deceased’s debts and taxes, and distributing the remaining property and assets as directed by the will.
The appointed executor of the will in question typically carries out these things. This person is also responsible for the paperwork, court appearances, and conferring with lawyers and tax professionals as required by the probate process.
Overall, the probate process can take six months to a year. It all depends on the directives coming from your will, the amount of debt you owe, and whether or not your executor will have to sell any real estate properties, securities, or other assets.
In Alabama and most other states, immediate family members can also ask the court to release short-term support funds during the probate process. However, they won’t be granted access to any assets or inheritances until everything is legally transferred over at the end of the probate process.
Can You Probate an Estate Without a Will?
The answer to this is technically yes. However, it requires some advanced planning.
It should be noted that if you or a loved one dies intestate in Alabama, then it’ll be up to the courts to handle the probate process. We’ll talk more about that in just a moment. Still, it’s essential to understand that it can take a lot longer to conclude when your estate is left to the state government to take care of. There are also strict rules that apply to how assets and properties are divided among family members—which could be an issue.
For now, here’s how estates can be probated without living wills:
Create Living Trusts
In Alabama, livings trusts can trump probate. A living trust is a legal document that an individual can create to name a specific beneficiary to receive certain assets or monetary amounts. This document also names a trustee, the executor of the trust.
Unlike wills, however, trusts take things a step further by physically transferring the ownership of the assets named in the document into the trust. When an individual moves their assets into a trust, they are essentially relinquishing the ownership of those assets.
Whoever is the named beneficiary of those assets is now the owner. However, there’s one caveat—the actual ownership hangs in limbo until the specified date or time for the assets to be officially released to their new owner.
Ultimately, this means that any assets transferred into a trust automatically bypass probate court proceedings as they are technically not owned by the deceased.
Use Joint Ownership
If you own something, such as a property with some else, it reverts to the “right of survivorship.” That means the surviving owner of the property or asset will automatically become its complete, legal owner.
Therefore, no probate proceedings will be needed to verify and transfer the property. However, some paperwork will likely be required to prove that the title of the property or assets were, in fact, owned in equal shares.
Payable-On-Death Designations
By creating a payable-in-death (POD) designation to your bank accounts, including savings and certificates of deposits, your named beneficiary can claim the money in them once you’ve passed.
They’ll be able to claim the money directly from the bank, no probate necessary.
Of course, while alive, you would still have full access and control to these accounts. You can even choose to spend all the money in them. However, your beneficiary won’t have any rights to the funds until you’ve passed.
Transfer-On-Death Registration
You can also register your stocks and bonds in the state of Alabama in a transfer-on-death (TOD) registration. Once you register your accounts in TOD, your named beneficiary will automatically inherit the account at the time of your death.
The beneficiary will only have to deal with the brokerage company where the accounts are open for the transfer, with no probate court.
There are two other common ways to transfer assets—TODs for real estate and TODs for vehicles. However, Alabama does not allow either of these types of TODs. Therefore, it’s a good idea to create living trusts if you have specific people in your life that you want to inherit these types of assets.
What Happens if You Die Without a Will?
If you die completely intestate in Alabama—no wills, no trusts, no joint ownership, etc.—then all of your assets will automatically pass through the Alabama Intestate Succession Laws. Essentially, the Intestate Succession laws divide up and pass down your assets through your closest living relatives, beginning with your immediate family and then your surviving parents and siblings.
The probate proceedings for intestate assets can take longer than the typical year, and any private assets you own will become a matter of public record. Additionally, the loved ones you leave behind won’t have any say in how your assets are distributed.
Everything is left up to the state, which has a specific formula for asset distribution. That formula works as follows:
If you only have children, then your children will inherit your entire estate
If you only have a spouse, then your spouse inherits your entire estate
Suppose you have a spouse and biological children with them. In that case, your spouse will inherit the first $50,000 of your intestate property and half the balance of the property. Your children will inherit the remaining intestate property
If you have a spouse and children that are not biologically related to that spouse, then the intestate property is split directly in half between them
If you have a spouse and parents, your spouse inherits the first $100,000 of your intestate property and half the balance of the property, and your parents will inherit the remaining intestate property
If you only have surviving parents, then they will inherit 100% of your intestate property
If you only have surviving siblings, then they will inherit 100% of your intestate property
The size of each individual’s share will depend on how many children you have, whether or not you’re married, and so on down the chain of relatives.
It should also be noted that according to Alabama law, any child inheriting a portion of your estate must legally be your child, whether through biology or adoption. This also includes grandchildren.
Suppose you don’t have a spouse, children, or any blood relatives during the time of your passing. In that case, your estate will become escheatable. In other words, all of your assets will become the property of the state government.
Estate planning in Huntsville, Alabama, doesn’t have to be an intimidating or arduous process. However, while you don’t have to draw up a last will and testament, any Huntsville attorney would advise you to at least create a living trust and make your accounts transferable, just in case.
For help with your estate planning, contact us. Sarah S. Shepard or another experienced Huntsville attorney will walk you through the process and can even act as the executor of your will or trusts if necessary.
