10.4 Probate & Estate Administration

Probate is the court-supervised process of proving a will, gathering the decedent's probate assets, paying debts and taxes, and distributing what remains. Non-probate assets — joint tenancy property, payable-on-death accounts, life insurance and retirement accounts with living beneficiaries, and trust assets — pass outside this process by contract or operation of law.

The Probate Process, Step by Step

1. File the petition — the original will (if any) and a petition are filed in the probate court of the county where the decedent was domiciled.
2. Notice — heirs and will beneficiaries receive notice of the hearing; notice is also published for creditors.
3. Prove the will — the court admits the will to probate. A self-proving affidavit avoids hauling in the attesting witnesses.
4. Appoint the personal representative — the court issues letters testamentary to the executor named in a will, or letters of administration to an administrator when there is no will (or no named executor able to serve). These letters are the representative's proof of authority — banks and title companies will demand certified copies.
5. Notify creditors — publication plus direct notice to known creditors.
6. Marshal and inventory assets — locate, secure, and value everything in the probate estate.
7. Pay claims, expenses, and taxes in statutory priority order.
8. Account to the court and beneficiaries.
9. Distribute the residue per the will or intestacy statute, obtaining receipts.
10. Close the estate — by court order or, in informal proceedings, by a closing statement.

The UPC offers informal probate (registrar approval, minimal hearings) alongside formal probate (full judicial supervision); supervised administration is reserved for contentious estates.

The Personal Representative

'Personal representative' is the UPC's umbrella term for executors and administrators. The role is fiduciary: collect and protect assets, continue or wind down a business prudently, keep estate assets separate, pay valid claims, file tax returns, account, and distribute. A bond protects the estate against mismanagement unless the will waives it. Priority for appointment runs: person named in the will, then the surviving spouse, then other heirs. The representative is entitled to statutory or reasonable compensation.

Creditor Claims

Two deadlines matter. The non-claim statute bars claims not filed within a short window after published notice — commonly three to six months (four months in many UPC states) — regardless of the claim's merit. And under the Supreme Court's decision in Tulsa Professional Collection Services v. Pope (1988), known or reasonably ascertainable creditors must receive actual notice; publication alone violates due process as to them. Paralegals therefore comb the decedent's records, mail notices, and calendar the bar date.

Inventory and Accounting

The personal representative files an inventory of probate assets, typically within about three months of appointment under the UPC, with date-of-death values — often supported by professional appraisals the paralegal coordinates. Accountings (interim and final) report every receipt and disbursement; beneficiaries may file objections, or waive accounting in informal administrations.

Small-Estate Procedures

Every state offers shortcuts when the estate is modest: a small-estate affidavit lets successors collect personal property (bank accounts, vehicles) with no court appointment, and summary administration provides a streamlined court process. Thresholds vary widely by state — from roughly $50,000 to well over $150,000 — and real property is usually excluded from the affidavit route.

Estate and Inheritance Tax Basics

• Federal estate tax — imposed on the transfer of wealth at death. The basic exclusion amount is $15 million per person for 2026 (set by the One Big Beautiful Bill Act of 2025 and indexed thereafter); the top rate is 40%. Very few estates pay it.
• Unlimited marital deduction for property passing to a U.S.-citizen spouse; unlimited charitable deduction.
• Portability — a surviving spouse may use the deceased spouse's unused exclusion (DSUE), but only if the executor files Form 706 (United States Estate Tax Return) to elect it, even when no tax is due. Form 706 is due nine months after death, with a six-month extension available.
• Annual gift tax exclusion — $19,000 per donee per year (2025–2026) can be gifted without touching the lifetime exclusion; the gift and estate taxes share one unified credit.
• Stepped-up basis — inherited property takes a new income-tax basis equal to its date-of-death value, erasing the decedent's built-in capital gains.
• Form 1041 reports the estate's income during administration; the decedent's final Form 1040 covers income through the date of death.
• Inheritance tax is a state-level tax paid by the recipient based on relationship; only a handful of states impose it, and it is distinct from the estate tax.

The Paralegal Role in Estate Practice

Estate paralegals run the machinery: draft wills, trusts, and powers of attorney from attorney-approved templates; prepare probate petitions, notices, inventories, and accountings; coordinate appraisals; marshal beneficiary designations; and — critically — calendar every deadline (non-claim bar dates, the nine-month Form 706 deadline, inventory due dates). The ethical line is firm: paralegals may gather facts and prepare documents under supervision but may not advise a client which documents to choose or opine on tax consequences — that is the unauthorized practice of law.

Paralegal scenario: An executor mentions a $12,000 hospital bill that arrived after the four-month non-claim period closed. You check the file: the hospital was known and never mailed actual notice. Under Tulsa v. Pope the claim may survive the bar date — flag it for the attorney before the executor rejects it.