Gathering Assets, Paying Debts, and Distributing Bequests
Gathering Assets, Paying Debts, and Distributing Bequests
Delaware estate administration is the legal process of gathering assets, paying debts, and distributing bequests (non-real estate) and devises (for real estate gifts) to the named beneficiaries as provided for in a Last Will and Testament or by the Delaware intestacy laws, where there was not Will.
In the case of a person with a Will, the beneficiaries are named. In the case of a person without a Will, the law provides for who the beneficiaries shall be depending on the marital status and the surviving next of kin.
At the time of death, a number of assets may be owned by a trust or may be automatically given to loved ones through beneficiary designations, for all other assets, be they monetary, tangibles or real estate property, are part of the probate estate.
In New Castle County, Delaware, estates with any real estate or other assets worth more than $30,000 require that a petition be filed with the county Register of Wills, followed by an inventory of assets and then a final accounting, plus a fee paid to the Register of Wills. That is true whether someone dies testate (with a Will) or intestate (without a Will). When someone dies, their estate becomes an entity that needs to be properly managed.
In most estates, an executor has been named in the Will to serve as personal representative, and if intestate, then someone may petition to the Register of Wills to be named as administrator, also a personal representative. When you work with our team at the Williams Law Firm, we ensure that your Delaware estate administration is handled properly to reduce the burden on you.
Understanding the role our law firm can play during this process will help you understand why it is important to have us on your team.
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During the estate administration process an attorney coaches you through the process to collect, manage, and distribute the deceased’s individual estate in accordance with Delaware’s state laws and the decedent’s Last Will and Testament. If a decedent had a Revocable Trust before their death, then most of this process may be moot, provided that the assets of the decedent’s estate were retitled into to the name of the trust. That would reduce the probate process.
For other assets not put in trust during a decedent’s lifetime, many estate plans provide for a Pour-Over Last Will and Testament that only names one beneficiary, the trust. For that process, we can also help with the Delaware Trust Administration.
For others without a Trust or Pour-Over Will, then a Delaware Estate Administration process may be necessary.
The work of the executor
If someone with an estate in Delaware passes away, the estate administration attorney can assist you with overseeing the administration of the estate. This process begins with analyzing the applicable documents and law to determine how the estate plan’s provisions. Then, the Will should be filed with the Register of Wills along with the death certificate.
If there is real estate owned in the decedent’s name alone or other assets valued over $30,000.00 then the estate needs to be opened. To open the estate after filing the Will and death certificate, a petition should be filed by the executor along with a statement appointing the attorney for the estate. Then, the Register of Wills can issue Letters Testamentary (or Letter of Administration) also known as “Short Certificates” which give the personal representative the power to contact third parties to obtain records under authority from the government.
This begins the official process of locating and collecting all of the deceased’s property. Then within a certain period of time an inventory must be filed, followed by the final accounting.
The personal representative must determine whether the assets of the deceased’s estate are sufficient to pay the remaining debts and cover any necessary taxes. As a priority, the fees of the personal representative and costs of estate administration need to be paid before the other creditors should be paid.
If the estate does not have money to repay the debt, then the debt will die with the individual. However, if one of the beneficiaries has co-signed a loan or a credit card in both husband and wife’s name, then the debt will become the responsibility of the surviving borrower.
A final income tax return will also need to be filed. If there are sufficient assets, one may consider waiting 8-months in Delaware from the date of death before paying claims and debts to see if any other claims may be filed. If creditors do not file claims or the debts are not otherwise acknowledged by the personal representative, then the creditor may not be entitled to payment after the 8-month period.
Before distributions, bills must be paid
The Executor distributes remaining assets
After gathering the assets, payment of the debts and filing of the necessary paperwork, the personal representative will be responsible for following the Will to divide up remaining assets according to the terms of the Will. However, personal representatives should also delay this process if there is a Will contest filed. This can create delays in distributing assets. Once the property has been divided, all debts and taxes are paid and the estate is officially closed with the Register of Wills, then the personal representative’s job is complete.
Trying to navigate this process without the guidance of an experienced estate attorney, can be challenging and cause delays and complaints which may have been avoidable. Therefore you should consider letting The Williams Law Firm assist you with the estate administration process. Outside of Delaware, we can also help with New Jersey and Pennsylvania estates. For more information on Trust Administration please visit that page here.
– Martin Luther King, Jr.