You love your house. You have enjoyed many years of living in your house. You’ve made it a home. Maybe you’ve even paid off your mortgage.
It all want according to plan, however, have you considered what happens to your house when you die? If your estate goes into probate, what will be the fate of your home? Will your heirs have to be exorbitant taxes when they inherit your house?
Many clients and potential clients of our probate law firm ask us the following question: What happens to a Michigan estate during the probate process?
Usually, a deceased individual’s property has to pass through a legal process known as probate before beneficiaries legally receive their inheritance. If there is no will, the state usually appoints a personal representative to administrate estate valuation and division. Where there is a valid will, it should name an executor who takes on those responsibilities.
After an administrator is named, he/she becomes responsible for compiling all estate assets and settling estate debts, including items like taxes, funeral costs, and administration expenses. After fulfilling these obligations, the executor or personal representative divides the remaining assets among beneficiaries.
Are all assets subject to the probate process?
Some estate items may not have to pass through probate at all. Some examples of assets that a Michigan probate court may not take into consideration during the process include the following:
➡ Cash in amounts up to $500
➡ Personal property not exceeding a value of $15,000
➡ Motor vehicles or watercraft whose value is no more than $60,000 and $100,000 respectively
➡ Retirement accounts or insurance policies with a designated beneficiary
➡ Property in a revocable trust
➡ Real estate held jointly with right of survivorship
➡ Bank accounts with a transfer upon death or payable upon death clause
➡ Assets owned in the deceased’s name only (such as real estate, bank accounts, stocks and bonds) and personal property exceeding $15,000 generally have to go to probate court.
Michigan law also allows for a streamlined probate process for smaller estates under a certain value. In 2018, an estate of no more $23,000 may qualify for proceedings that require minimal court action.
Going through probate is often a time of high emotion and high stress. Appointed executors should consult with an experienced attorney like the lawyers at the Probate Law Firm of Thav Ryke and Associates in Michigan. We can provide you with advice on how to navigate the process smoothly, avoid common missteps and keep beneficiaries happy.