What is Probate?
Probate is the court process that transfers assets from someone who has passed away to whoever is determined to receive those things. The assets a person owns when they pass are known as that person’s Estate. During the Probate Process, a judge oversees the transfer of assets from the Estate through various court filings and creditor periods to make sure things transfer properly. It is not necessary to have an attorney for this process but it can be very helpful, especially in dealing with the court and when real property (a house, land, or mineral interests) have to be transferred during this process.
If the person who passed away had a Will in place, that document is going to serve as the instruction sheet for this process. All of the transfers will be made according to those instructions. If there is no Will, Colorado’s Intestacy Statute kicks in and instructs the court as to who should receive assets from the decedent’s estate. If there are no surviving relatives described in that statute, Colorado will receive the assets instead.
Who is Involved in the Probate Process?
Besides the court personnel, the Probate process can involve an array of people and who those people are can be determined ahead of time in a person’s Estate Plan.
Most people are familiar with the term “executor,” but the new term used to describe the person in charge of things during the probate process on behalf of the Estate is “personal representative.” This person is officially appointed to this role by the court as the first step to starting a probate. After that, any dealings with estate property must go through this person. They are personally responsible for making sure the estate is dealt with properly and all the people who should receive things from the estate get their share by the end of the process. If there is a Will, this person is chosen in that document. If there is no Will, the court will appoint the person most closely related to the decedent.
Once a person passes away, the people who are set to receive their assets are known as either their heirs or beneficiaries. They are both terms that describe the people who receive assets after someone passes but which term is used depends on whether the person who passed had a Will the court will follow or not. If there is a Will, the people listed as receiving property in the Will are considered beneficiaries and can be whoever that person wished to leave their things to. If there is no Will, the people who will receive things from the decedent are known as heirs and are determined by Colorado Law. Heirs are whatever relatives the person has starting with those closest to them and following their family tree as far as necessary.
Only the estate is responsible for paying any debts the decedent had when they passed away, the Personal Representative is not personally responsible for any of those debts. Neither are any family members. Creditors have to file claims with the court in order to get paid by the Estate, and they have to do so within the creditor period that is part of the probate process. If they miss that period, they do not have a right to get paid back anymore.
What Does the Process Look Like?
The process starts when the Personal Representative is appointed by the court. The day that person is appointed marks the start of the minimum six-month period that probate must last. Then, the next step is starting the creditor period by publishing in a local newspaper. The first date of publication marks the start of that four-month long creditor period. During that time, and after the Personal Representative has been appointed, that person can open an Estate Bank Account and transfer assets into that account so that they can be accounted for during the process. If there’s real property, the process of transferring that property can begin. It is very helpful, for that process at least, to have an attorney and a real estate agent familiar with probate involved to make sure that transfer is proper and achieves the Estate’s goals. Once assets are placed into the Estate Account, it is a waiting game to see if creditors file claims during the time allotted to them. Once those four months have run, they can no longer file claims and the process is reduced to waiting for the larger six months to run. Once that has run, if everything is settled, the distributions can be made and signed off on and the probate can be closed.
How Long is the Probate Process?
The probate process has to last at least six months in Colorado. That is the minimum. If everything goes relatively smoothly, that minimum can be kept; however, if there is any fighting or issues, that six months can get longer rather quickly. That six months is started when the Personal Representative is appointed by the court.
Within that process, there is a four-month creditor period. As soon as the probate is open, creditors can file claims, but once this creditor period within the probate process ends, they forfeit the right to ask for payment. That period is started by publication in a local newspaper that the decedent has passed and providing information about the case to creditors for if they’d like to file a claim. Four months after the date of first publication, that period ends, and the estate is no longer obligated to respond to creditor claims.
If everything is settled by the time the sixth month rolls around, everyone set to receive assets can receive their share and sign off on that fact. Then, the probate can be closed, and the process is over.
Is a Probate Always Necessary?
Probate is not always necessary in Colorado! It is only required if one or both of the following things are true: (1) if you have over seventy thousand dollars of assets in your name and without beneficiaries designated on them; and (2) if you own a house, land, or mineral interests.
Even if one or both of those things are true for you, you can still plan to avoid the probate process. Good Estate Plans make this daunting task unnecessary so plan to avoid the courts today.
If You or Someone You Know Has Questions
If you or someone you know is in the middle of a probate, or is unsure whether or not they need a probate have them give us a call at Althaus Law. We are happy to assist and answer any questions. Althaus Law can be contacted at 720-340-2783 or a meeting scheduled by using this link.