What is meant by probate in Massachusetts?
Probate is the legal process that takes place after someone dies in which that person’s assets are paid out to beneficiaries according to the deceased person’s will or through intestacy rules if there is no will. Debts and taxes are also paid to creditors and government entities before beneficiaries receive their payments. Probate is often quite lengthy and can be expensive, too, especially when attorneys’ fees are taken into account. There are benefits and drawbacks of going through probate in Massachusetts, and you are advised to seek assistance from an attorney in devising an estate plan that best suits your circumstances.
The probate process in Massachusetts
Probate starts after the executor (also called the ‘personal representative’) of a will files a petition with the probate court after someone dies. If the deceased did not make a will, but had assets that were not jointly owned by others, such as a surviving spouse, then the process is more complex as the court must appoint an administrator to decide what to do with those assets according to the state’s specific intestacy rules.
Once the petition has been filed, then the probate process begins with a formal hearing presided over by a probate judge. All beneficiaries named in the will are notified of the hearing location, date and time. The will is read out at the hearing and there may also be a notification posted in the local newspaper. The hearing allows beneficiaries and potential beneficiaries to discover what was in the will and to make sure that the terms of the will are clear to all and there are no discrepancies or challenges to the will.
Once beneficiaries have been notified, creditors are contacted. These include anyone who is owed an outstanding debt, as well as any former employees who haven’t been paid. Taxes owed to any level of government, including federal taxes are also assessed and calculated.
All debts, taxes and expenses are paid out of the assets of the estate before any beneficiaries are paid according to the terms of the will. Expenses include reasonable amounts that the personal representative finds necessary as well as court fees and burial or funeral expenses.
In Massachusetts, probate must be completed within 3 years, although in most cases it is completed in less than a year, typically around 9 months from the initial filing.
Simplified probate
In Massachusetts, if the total assets of the deceased are less than $25,000 and there is no real estate owned by the deceased, then a faster form of probate, called simplified probate, can be requested. If the circumstances of the deceased’s assets and combined debts meets the criteria established for simplified probate, the it may be completed within days, rather than months.
What are the benefits of the probate process?
The main benefits of the probate process are that an estate is dealt with according to an established procedure and beneficiaries are paid according to the wishes of the deceased and creditors are also paid any debts correctly.
What are the drawbacks of the probate process?
The main drawback of probate is that it can take many months before completion. In fact, this waiting time is part of the process of probate as it takes time for any potential beneficiaries to be notified as well as potential creditors to make a claim on the estate. The problem is that the longer and more drawn out or complex is the probate process is, the more expensive it can be. As expenses mount up, this means that these must be deducted from what remains to be distributed to beneficiaries. It helps if the testator (the person who makes the will) made the instructions in the will as clear as possible so that there is less room for confusion or contest. If property is located in states other than Massachusetts, then there will be a further delay (and costs) as probate in those states will be involved, too.
How can probate be avoided?
A well designed estate plan may help to avoid the excess costs and time involved in probate even if it can’t be avoided altogether. Joint ownership with a spouse, for instance, may simply involve a transfer of jointly owned assets to the spouse in the event of death. A trust can be set up at some point and the lion’s share of assets owned could be transferred into the trust. The trust retains the assets until death when they are then distributed to the beneficiaries named in the trust. There are different types of trust, so you do need to talk to your estate attorney about the pros and cons of each type before setting up a trust. If you set up an irrevocable trust, for example, you cede access to the assets altogether.
Trusts are not usually set up just to avoid probate, but for other reasons, such as avoiding lawsuits, taxation and, if set up early enough, to meet the criteria for MassHealth.
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