Probate, by definition, is the legal process that happens after a person (the “decedent”) dies, regardless of whether the person died with a valid will or not. If the decedent dies with a will, their property is distributed according to the will. If a decedent dies without one, Michigan Probate laws will dictate how the decedent’s assets will be distributed. Probate is also referred to as estate administration.
There are 4 steps to Michigan Probate
- Appointing the Personal Representative/Executor/Administrator. This person is responsible for gathering the assets, paying debts and taxes, and distributing the inheritance – they are named in the will or by the probate court.
- Assembling all the assets. This is gathering inventory and safeguarding the assets. They will also have property(ies) appraised if necessary, the value will become important when determining each beneficiary’s share.
- Paying Bills. All the decedent’s debts, taxes, funeral expenses, creditors, general administration expenses, and possibly ongoing lawsuit judgments. This is all paid out of the decedent’s estate, assets might need to be sold off to cover these costs. The executor or beneficiaries are not personally responsible for any debt acquired by the decedent UNLESS you co-signed, were named in a lawsuit, or are a joint account holder. There are, however, some assets that are safe from creditors. You can designate a beneficiary of your retirement accounts – this cannot be taken away from your beneficiaries to pay off debt. Life insurance and assets in an irrevocable trust.
- Distributing the remaining assets. Assets are distributed according to the will or if there is no will, according to state law.
There are ways to avoid probate, but sometimes it is absolutely necessary if there are disputes, title transfers, and if there is no will. Even if there is a will, probate is still necessary to ensure assets are properly distributed. Don’t try to tackle probate court alone, it’s tedious and time-consuming and sometimes can be confusing. Always contact an experienced Probate Attorney to help you along.