Probate Administration

Losing a family member or friend is one of life’s most trying events. At the Whelihan Law Firm, we’re committed to estate administration with expertise, efficiency and compassion.

The emotional turmoil that follows the death of a loved one makes the important — and sometimes urgent — decisions that must be made when dealing with estate administration even more difficult. Drawing upon years of experience, we work with you to avoid the many pitfalls associated with settling an estate and to solve problems far more quickly and efficiently than you can on your own.

Post-mortem estate planning provides important opportunities to minimize the overall tax costs and to preserve the maximum amount of property for a decedent’s intended beneficiaries. The estate plan adopted during a person’s lifetime establishes the basic pattern for the disposition of property at death. However, the after-death consequences of the plan can vary substantially depending upon the elections made, including disclaimers and other actions taken, by the decedent’s fiduciaries and beneficiaries.

At the The Whelihan Law Firm, we explain the steps that will be involved in settling an estate and communicate regularly with the personal representative and beneficiaries throughout the administration of the estate.

Our Goal
Our objective is to settle your loved one’s estate in a timely and efficient manner, while keeping costs reasonable. We provide counsel and advice throughout the entire process. We assist with probating the decedent’s will or securing the appointment of an administrator of an intestate estate. The firm helps the personal representative identify and value the assets of the estate, as well as handle liabilities and address claims made against the estate. Drawing on our experience in taxation, we counsel clients regarding options to minimize the overall tax costs associated with the transfer of assets and guide you through the intricacies of state and federal taxes, including estate and inheritance taxes, gift taxes, income taxes, capital gains taxes and generation-skipping transfer taxes. We arrange for the orderly transfer of assets by assisting with the completion and proper submission of life insurance claims, retirement benefit distribution and rollover requests, preparing deeds, and other necessary documentation associated with the proper retitling of assets. We prepare all of the relevant tax returns, including the decedent’s final income tax return, inheritance and estate tax returns, fiduciary returns and gift tax returns.

What is probate?

When a person dies, his assets are collected, administered, and distributed by someone who is appointed to act in the place of the deceased person. The personal representative is appointed to identify and gather all of the decedent’s assets that comprise his estate. If there is a Will, an application is filed with the county Surrogate or Register of Wills to admit the Will to probate. Probate is the legal process of proving the validity of the Will, the appointment of a personal representative and the distribution of the estate’s assets. The executor is named in the Will. The process of distributing the estate’s assets to the heirs can only begin after the validity of the Will has been established and the personal representative is appointed.

The personal representative conducts what is known as an estate administration, which is the process of gathering all of the assets, paying all of the decedent’s debts, paying all of the taxes occasioned by the death, and then distributing what remains to those who are entitled to receive the assets, either under the terms of the decedent’s Will or by operation of state intestacy law in the absence of a valid Will.

If the deceased did not leave behind a Will, then a petition to request appointment as the deceased’s administrator must be filed in the county where the decedent last resided. The administrator’s duties and responsibilities are similar to those of an executor.

Must every estate go through formal administration?

Most states, including New Jersey and Pennsylvania, have special rules regarding the settlement of statutorily defined “small” estates, which do not exceed a specified dollar value. The settlement of a small estate still requires the filing of an application or petition, depending upon the circumstances. In almost every other instance where a person passes away owning personal property or real estate, his estate should be administered.

What are probate assets?

Not all assets pass through probate. The way property transfers upon death is dependent on whether the property is characterized as probate or nonprobate property. Probate property passes by Will or, if there is no valid Will, by state intestacy law. Nonprobate property is transferred pursuant to the death beneficiary designations for such property. There are a variety of ownership interests for which the law recognizes death beneficiary designations. Examples of nonprobate property include life insurance, retirement accounts, joint tenancies, and beneficial interests in trusts. Generally, all other property that is directly owned by a person for which there is no legally recognized death beneficiary designation is probate property.

What are death taxes?

There are various taxes involved in decedents’ estates. The two most common are the inheritance and estate taxes. An inheritance is basically a tax on the privilege of receiving property from a decedent. The inheritance tax is imposed on taxable transfers of property at a flat rate. The rate depends on the relationship of the beneficiary to the decedent. For example, the transfer to a brother or sister is treated differently for tax purposes than transfers to a child or more remote relative such as a niece or nephew. The estate tax is an excise tax levied on the transfer of a person’s property at the time of that person’s death. The amount of tax is determined by applying the relevant tax rates to the taxable estate. The taxable estate is determined by subtracting certain deductions from the gross estate.

The personal representative of the estate is responsible for making sure that the appropriate tax returns are filed.

Are there both state and federal taxes?

There are various taxes involved in decedents’ estates. At the federal level, the common taxes include the estate, gift and generation-skipping taxes. Many states, including New Jersey, impose their own taxes on the transfer of wealth, including inheritance and estate taxes.

Do survivors pay tax on inherited property?

The personal representative of the estate is obligated to pay the taxes which result from a decedent’s death, but state law determines the source from which those taxes are paid. A person may in his or her will direct that such taxes be paid from the decedent’s estate or be apportioned among the recipients of the decedent’s taxable estate. How the taxes are paid can have significant consequences depending on the circumstances, and the issue should be given careful consideration in one’s estate planning.

What are the duties of a personal representative?

Once an Executor or Administrator has been appointed by the Surrogate or Register of Wills, his or her duties include:

• Determining, locating and notifying the heirs and beneficiaries of the estate that the decedent has passed away and that a personal representative has been appointed. If there is a Will, a copy of the decedent’s Will is generally made available.
• Identifying, locating, collecting and securing all of the assets of the estate.
• Determining the value of all assets.
• Ascertaining whether the estate has any claims against third parties.
• Determining and paying from the estate assets the valid debts, expenses, and taxes of the estate.
• Determining whether to sell or retain certain assets of the estate.
• Managing and maintaining the assets of the estate. This is particularly important in estates involving rental or other income-producing property.
• Complying with the pertinent requirements of state and federal law.
• Providing and accounting, whether formal or informal, of his or her administration of the estate.
• Distributing the assets of the estate to the heirs or beneficiaries after his or her administration has been completed and approved.

How long does it take to settle an estate?

Generally, the average estate takes about a year from the date a personal representative is appointed to conclude the administration. Large or complex estates, or estates involving litigation or contested issues, may take considerably longer to settle.

How and when is the probate process closed?

Generally, the timing of final distribution of the estate is determined by the completion of the necessary tasks, such as paying all debts, including taxes. The time required to complete an estate administration can vary depending on the circumstances. Generally, the average estate takes approximately about a year from the date a personal representative is appointed to conclude the administration. Large or complex estates, or estates involving litigation or contested issues, may take considerably longer to settle.

Are estate administrators entitled to compensation?

Personal representatives are entitled to commissions established by state law. A court may award more or less than the statutory commission based on the circumstances and the actual work performed by the personal representative.