Estate Administration
Estate Administration is the process of settling a person's affairs after they become deceased. It may involve formal probate, or a simplified probate process. Formal probate is necessary when the Personal Representative (Executor) is not the only beneficiary (see Statement in Lieu of an Accounting (SIL) below) and when the assets passing through the probate system exceed $50,000 (see Small Estate below).
Formal probate
There are several steps in the probate process. Generally, this process will take about a year, but may be longer depending on the situation.
The first step is to find the original Will and any Codicils (amendments) and make an appointment to record it with the Clerk of the Circuit Court of the decedent's city or county of residence. Take to the appointment the original Will, any original Codicils, your best estimate of what the decedent owned at his or her death, a list of the decedent’s family members, their ages and addresses, and your checkbook. At this appointment, you will complete and sign several legal documents, and will be formally appointed to serve as the Executor.
After you are qualified, you should immediately take your letter of qualification and open an estate account at a bank of your choosing. This is the account you will use to collect estate assets, pay any estate bills, and to eventually distribute the money from the estate to the beneficiaries.
Within one month of your qualification you need to send a notice to all the natural heirs of the decedent that you have been qualified as the Executor and that they may (or may not) inherit. This should be done by certified mail.
Within four months of your qualification you must file an inventory with the Commissioner of Accounts that details all the assets that the decedent owned at the time of his or her death and the values of those assets. Documentation proving the values of those assets will be required. Also within four months, you need to file an affidavit of notice with the Clerk of the Circuit Court stating that you sent out the notice to the heirs.
Within sixteen months of your qualification you will need to file an accounting with the Commissioner of Accounts. The Accounting will cover the first twelve months from the date you became qualified, and must detail all the assets that were put into the estate, all the bills you paid from the estate, and any distributions you have made to beneficiaries. If, before a year from the date of your qualification you have distributed all the assets to the beneficiaries, then the first accounting can be the final accounting. However, if you have not made a final distribution to the beneficiaries of the estate within a year of your qualification then you will have to file an additional accounting.
Generally, it is wise to not distribute all assets from the estate within a year of the date of death because potential creditors have the right to make a claim on the estate within a year of the date of death. If you, as the Executor, have distributed all the assets before the claim is made then it is your responsibility to get the assets back to pay the debts of the estate. This can be difficult (or impossible) to do, and you can be legally liable for the debt.
It is often smart to have a “Debts and Demands” hearing, as well as to ask the Circuit Court to enter an Order of Distribution. These are all ways to minimize your potential personal liability should creditors appear after you have distributed the estate.
Statement in Lieu of an Accounting (SIL)
A Statement in Lieu of an Accounting (generally abbreviated to Statement in Lieu or SIL) is allowed under Virginia law when the Personal Representative (Executor) is also the beneficiary. The Personal Representative still must go through many of the steps outlined above, but having filed the Inventory, the Personal Representative may file a statement that basically affirms that the debts have been paid, the taxes have been paid, and all assets have been disbursed. There is no requirement that the Personal Representative file an Accounting of all actions taken on the estate. This makes sense since the Personal Representative is the beneficiary. All of that reporting required under Formal Probate is necessary to be sure that the interests of all beneficiaries are being protected. When the Personal Representative is the beneficiary, no one else's interests are being protected.
Small Estate
When the assets passing through the estate are $50,000 or less, Virginia requires less rigorous scrutiny of the actions of the Personal Representative. There is the ability to do "Probate by Affidavit".
How can we help?
We can help in many ways; it is your choice.
- Consultation to get you started right: You can have a consultation with an experienced estate administration attorney, who can help you evaluate the options and determine whether any probate is needed, and if so, whether either of the simplified probate procedures is appropriate.
- Represent the Fiduciary: We can be retained to represent the Personal Representative in making the qualification appointment and can accompany you to the appointment and complete the paperwork for you; we can complete the Notices, Affidavit, Inventory, and Accountings, as well as receipts for the beneficiaries using the information you provide.
- Professional Fiduciary: In some circumstances, the family may prefer to have a professional settling the estate. This may occur when there are no family members in the area, when family members have busy lives and simply do not have the time to attend to the business of settling the estate, or when the family members do not have the detailed mindset to keep track of every penny in, every penny out. Frankly, those who do not balance their own checkbooks will have difficulty with the detailed requirements of estate administration. So, at your request, the firm can qualify as the Personal Representative, and will settle the estate (for more information, see Fiduciary Services).
Please see the drop-down titled "What to expect at your Estate Administration appointment" to get an idea of what to bring, and what to expect.
Susan I. Jean & Associates LLC
