Probate is the formal process of administering a will after a person’s death or distributing the assets of a deceased individual to the intestate beneficiaries if there is no will. The probate process in Washington state consists of several different steps.
1. Filing Initial Probate Documents.
The attorney hired by the personal representative files the original will with an affidavit of attesting witnesses, a copy of the decedent’s death certificate with the social security number redacted (required in Whatcom County but not in all counties in Washington State), a petition, an oath of personal representative and the $240 filing fee with the Clerk of the Superior Court. If there is no will, someone interested in the estate files a petition requesting to be named the administrator or administratrix of the estate. Personal representative is the gender neutral term for an “executor”, “executrix”, “administrator”, and “administratrix.” The petition names the decedent’s heirs and beneficiaries with their last-known addresses. The petition states back-ground information about when the testator signed the will and who the testator appointed as the personal representative in the will. The petition asks that the court appoint the person named as the personal representative. The oath of the personal representative states that the named person agrees to follow the rules of law in administering the estate.
2. Nonintervention Powers.
If the will states that the personal representative can act without the intervention of the court, and the decedent’s assets exceed the decedent’s debts, then the personal representative will administer the estate without the court’s intervention. If, however, the debts of the estate exceed the assets of the estate, or if there is no will, or if the will prohibits the personal representative from having nonintervention powers, then the personal representative will need to ask the court for permission every time they want to sell an asset or distribute any estate monies, even to pay estate bills.
3. Multiple Probates.
If the decedent owns real property in more than one state and the real property is not held in a trust or as joint tenants with right of survivorship, then each state will either require a probate or some other process to transfer the property to the intended heirs.
4. Judge Signs Order.
After the judge signs the order appointing the personal representative and admitting the will to probate, then the personal representative has 20 days to send notice of the appointment and pendency of the probate to the decedent’s heirs and beneficiaries. The heirs or beneficiaries have four months to file a will contest from the time the court admits the will to probate. Will contests are very difficult to win if the will was signed in the presence of two witnesses and the testator was over the age of 18 and competent at the time of signing.
5. Letters Testamentary.
After the will has been admitted to probate, the court clerk issues “Letters Testamentary.” Letters Testamentary identify the personal representative and state that the personal representative has authority to deal with estate matters. The estate receives a taxpayer identification number separate from the decedent’s social security number for its accounts.
6. Notice to Creditors.
The personal representative searches for the decedent’s creditors by reviewing the decedent’s files and mail. Although state law no longer requires that the personal representative file a Notice to Creditors in a legal newspaper, a personal representative protects himself or herself by publishing a Notice to Creditors, which costs approximately $285 in Whatcom County. A surviving spouse or the person who paid the decedent’s bills during the last couple of years of the decedent’s life may feel that they know all of the creditors and publishing a Notice to Creditors merely adds an additional expense to settling the estate.
A creditor has four months from the time the Notice to Creditors is first published in the newspaper to file a claim against the estate. If the personal representative should have identified the creditor, then the creditor can file a claim against the estate for the later of the four-month time period or 30 days after the creditor receives actual notice. Generally, the personal representative notifies all of the creditors so that the 30-day period ends at the same time as the four-month time period ends.
The personal representative collects the assets of the decedent included in the estate. Assets of the decedent included in the estate are all of the decedent’s assets including real property, bank and brokerage accounts, business interests, life insurance, retirement benefits and medical insurance payments, but excluding all property passing by beneficiary designation. Although state law no longer requires the personal representative to file an inventory with the court, the personal representative still must inventory the assets within three months of being appointed as the personal representative. The beneficiaries and heirs may request a copy of the inventory after that three-month time period.
After the notice to creditors’ claim period has ended and the creditors have been paid, the personal representative could distribute the assets of an estate not subject to estate taxes. The personal representative can either sell the property owned by the decedent and distribute cash or can distribute the property in kind, meaning distributing the item.
For example, Martha owns a house. Her will states the remainder is divided equally between her two children, Martin and Chris. Martha dies. Chris is the personal representative. The house is the only estate asset. The value of all of Martha’s assets is less than $2,000,000. After Chris publishes Notice to Creditors and waits the appropriate four months, she can either distribute the house in equal shares to Martin and herself, or she can sell the house and distribute the cash proceeds in equal shares.
7. Estate Tax Return.
If the estate assets exceed $11,580,000 in 2020, then the personal representative must file a federal estate tax return, and if the estate assets exceed $2,193,000 in 2020, then the personal representative must file a Washington state estate tax return. A surviving spouse may want to file a federal estate tax return in 2020 even if the amount of the decedent’s estate is less than $11,580,000 so that he or she can preserve the decedent’s federal exemption amount for the surviving spouse’s death. The return is due nine months after the decedent’s death. Typically, that return is not filed until the last day of that nine-month period so that the estate retains the income from the money used to pay taxes during the administration period. The personal representative might distribute a small portion of the estate to the beneficiaries at that time, after the initial calculation of the estate taxes is made. However, the personal representative will hold back a portion of the estate to pay any additional IRS or Department of Revenue assessments. Generally, the personal representative requests that the IRS complete a prompt assessment of the tax return. The personal representative should be notified by the IRS within 18 months after filing the return of any additional taxes that may be owed.
8. Distribution of Assets and Closing Probate.
After the personal representative receives the closing letter from the IRS stating no additional taxes are due and the release letter from the Washington State Department of Revenue and any other state where the decedent owned real property, then the personal representative will distribute the property according to the will.
When the personal representative distributes the property to the beneficiaries, the beneficiaries sign receipts for the property. The personal representative can also request that the beneficiaries waive their notice to the filing of the declaration of the completion of the probate. If the beneficiaries do not waive their right to notice, the personal representative must send notice to the beneficiaries who have not signed waivers that the personal representative filed the completion of probate.
The beneficiaries have 30 days to dispute the fees and distributions made by the personal representative. The personal representative may pay fees to appraisers, accountants, attorneys and themselves for handling the estate affairs. After 30 days expire, the personal representative is dismissed with no additional liabilities to the estate.
9. Estate Income Tax Return.
The estate must file an estate income tax return if the estate earns more than $600 during the administration of the estate.
10. Time to Probate Estate.
The amount of time a personal representative spends in probating an estate will vary depending upon the size of the estate and the assets that the personal representative must sell before a distribution can be made. A small estate may close shortly after the creditor period ends while a large estate will not close until after the personal representative receives the closing letter from the IRS and Department of Revenue.
Although a probate is a procedure defined by state statutes, a personal representative in a nonintervention probate is given great liberty to make decisions regarding the sale and distribution of the decedent’s assets without the interference of the court. The steps that the personal representative follows in a probate, including the initial and the closing probate paperwork, are identical to the steps a trustee follows in a trust administration.