If your loved one passed away without a will, Utah law provides several options for settling the affairs of his or her estate. Utah is one of several states that allows for independent administration of a person’s estate after he or she passes away without a will (also known as “intestate”). Independent administration is a relatively simple way for the personal representative of an estate (commonly called an executor if the individual was named in a will or an administrator if the individual was appointed by the court) to collect and distribute a person’s assets to his or her heirs without the intrusive and cumbersome supervision by a probate court that would be involved in a dependent administration. Although the Utah Estates Code defines who gets what, it is up to the heirs to take the steps necessary to make it happen.
Independent administration is typically not available when one of the heirs is a minor, not all heirs agree (or have the capacity to agree) as to who should appointed, or the estate does not have sufficient assets to pay its debts. Also, dependent administration may be preferable if the estate has significant debts, because procedures under Utah law make it much more difficult for a creditor to collect in a dependent administration. However, even the simplified process of independent administration may be overkill for some intestate estates.
An affidavit of heirship is a document that provides details as to the deceased’s family and marital history and identifies all of his or her heirs, real property, and unpaid debts. Once it has been signed and notarized by two witnesses who are not heirs of the deceased, it is then recorded in in the real property records of each county in which the deceased had real property. It serves as evidence that title to the deceased’s real property has passed to his or her heirs. For instance, an affidavit of heirship is useful when the child of a single parent wants to sell the parent’s home, but the title to the home is still in the parent’s name. Most title companies and real estate companies will allow the heirs to sell the property after an affidavit of heirship is recorded.
As you can probably guess from the title, a small estate affidavit can be used when a person leaves behind a small estate. In order to take advantage of this procedure, the deceased cannot have an estate worth more than $50,000, excluding the value of the person’s homestead and certain exempt property. Like an affidavit of heirship, this document will list all of the deceased’s family and marital history and identify all of his or her heirs, real property, and unpaid debts. In addition, it will also list the person’s other assets, such as vehicles, bank accounts, and household belongings. This affidavit needs to be signed by two disinterested witnesses, as well as all of the person’s heirs, and it is filed with the probate court for approval. A small estate affidavit cannot be used if the estate has more than $50,000 in assets, excluding the homestead and exempt property, the assets must exceed the liabilities of the estate, and the estate has land other than the homestead.
Once the affidavit is filed, the probate court will consider the affidavit. If the judge determines that the affidavit meets the requirements provided by the Estates Code, the judge will sign an order approving it. The judge’s order can then be used by the heirs in case they need to show that they have authority to take possession of and distribute the deceased’s assets.
The small estate affidavit is a procedure that is relatively unique to Utah. For this reason, even though Utah law permits the heirs to take possession of and distribute a deceased’s assets, heirs may encounter resistance from people from other states who are unfamiliar with small estate affidavits. This problem most frequently arises in financial institutions that are headquartered somewhere else or that have branches throughout the country. You should make sure that the company or bank holding your loved one’s assets will be willing to distribute the property if a small estate affidavit is approved.
People sometimes mistakenly believe that they can avoid probate court if there is no will. That is generally not true. While probate is the process of proving a will valid, estate administration ties up the loose ends of a person’s financial life. Both probate and estate administration must be done in probate court. Whether the deceased had a will, or not, does not matter. If they had personal property or real estate, life insurance proceeds from a work policy, a retirement account, or just a share of the family cabin, those assets need to be distributed to a surviving family member (heirs). If the deceased person didn’t leave a will to tell family members and loved ones where they wanted those assets to go, then the state will decide.
The legal term for dying without a will is “intestate.” (The term for dying with a will is “testate.”) The deceased person’s property will be distributed according to the state’s intestacy succession laws. The estate administration process is supervised by a probate court judge who has jurisdiction over the estate. In many states, the court will first hold a hearing on the petition. If there is no will or there is no valid will, then the court will proceed to appoint an administrator to serve on behalf of the intestate estate.
Some types of property will be transferred to someone else without probate court. For example, the decedent’s share of a property owned in joint tenancy with the right of survivorship. That will automatically go to the surviving joint owner. The only assets that will be handled in the estate administration process are those that have no legal ownership.
A will usually names an executor to handle the hands-on work of probating the estate after the testator’s death. When there is no will, someone will need to petition for the role. An administrator is appointed by the probate court (also called a personal representative) has the same responsibilities and duties to manage the estate administration process as an executor named in a will. Usually, a family member who stands to inherit some of the assets of the estate fills out the petition to the court. After all, it is in their interest to see that the property doesn’t languish or disappear. They want to see it distributed and they want to benefit. However, in many states any interested party may petition the court to be appointed, including a creditor of the estate.
Also, the person who takes on the role of administering the estate can be paid a fee for doing that work.
The first step in the estate administration process, then, is for the probate judge to review the petition and to determine whether they will appoint the applicant as the personal representative, or someone else.
State law does have some restrictions on who can act as an administrator or personal representative. They must be 18 years of age, of sound mind, and without a criminal record (or a certain kind of criminal record). The law varies from state to state. The person petitioning to be the personal representative may also have affidavits from other heirs agreeing to their petition. They must also provide a copy of the death certificate and a preliminary list of assets. If the probate court judge does not approve of the petitioner, they may assign a county administrator (usually a lawyer) or other probate-related agency to take on the role. This is usually only done if there is no one who has agreed to take on the role.
State laws on intestate succession identify classes of heirs. These classes determine the order of distribution of assets among the heirs and the share of the estate they will inherit. The most common and easily identifiable heirs are, in order of inheritance rights: surviving spouses, children, parents, and siblings. Closer relatives will receive an inheritance before distant relatives. If the deceased did not have any of this class of family member, then intestate success laws will specify more distant relatives: aunts and uncles, and cousins. Friends and charities do not receive anything under intestate succession. If there are no surviving family members, most states will order that the entire estate goes to the state.
After appointing a personal representative and identifying the heirs, the probate court will determine what estate assets to distribute and how to distribute them. The personal representative has to collect the deceased’s assets and real property, including bank accounts, life insurance policies, vehicles, real estate deeds, and personal property. Once these assets are documented, the personal representative must determine the value of the estate.
The personal representative also needs to gather information on all of the debts owed by the deceased. Before they can distribute assets, they must pay the estate’s debts and taxes. In most cases, the distribution of remaining assets will be shared among relatives. The probate court will hold a hearing on the petition for final distribution and accounting. The probate court will finalize the process by issuing an order approving the final distribution and accounting.
Living trusts were invented to let people make an end-run around probate. The advantage of holding your valuable property in trust is that after your death, the trust property is not part of your probate estate. (It is, however, counted as part of your estate for federal estate tax purposes.) That’s because a trustee not you as an individual—owns the trust property. After your death, the trustee can easily and quickly transfer the trust property to the family or friends you left it to, without probate. You specify in the trust document, which is similar to a will, whom you want to inherit the property.
You can convert your bank accounts and retirement accounts to payable-on-death accounts. You do this by filling out a simple form in which you list a beneficiary. When you die, the money goes directly to your beneficiary without going through probate. You can do the same for security registrations, and, in some states, vehicle registrations. The majority of the states also now allow transfer-on-death real estate deeds, which take effect when you die.
Several forms of joint ownership provide a simple and easy way to avoid probate when the first owner dies. To take title with someone else in a way that will avoid probate, you state, on the paper that shows your ownership (a real estate deed, for example), how you want to hold title. Usually, no additional documents are needed. When one of the owners dies, the property goes to the other joint-owner—no probate involved.
You can avoid probate by owning property as follows:
Giving away property while you’re alive helps you avoid probate for a very simple reason: If you don’t own it when you die, it doesn’t have to go through probate. That lowers probate costs because, as a general rule, the higher the monetary value of the assets that go through probate, the higher the expense. And most gifts aren’t subject to the federal gift tax.
