When someone passes away with a will, the act of settling the person’s obligations is called the “probate process.” Probate rules will vary based on both the jurisdiction and the complexity of the will, but there are some basic concepts that are in place no matter where the person — called the “testator” — resided prior to his or her death. There are three basic steps to the probate process. First is a determination of what property belongs to the testator and may be admitted to the probate process; second is the paying of any associated taxes and debts of the testator at his or her time of death; last is the distribution of any property to the appropriate parties.
The first step is the determination of which property the testator may be considered to own for the purposes of the probate process. The complexity of the probate rules in this step will vary based upon the nature of the property. The most complex probate rules often stem from the determination of whether property owned jointly between a husband and wife may be admitted to probate. For example, a home that is owned by the couple at the time of the death may automatically go to the spouse of the testator in some jurisdictions, while the testator may be free to devise his or her half interest in the home through a will in other jurisdictions.
The second set of probate rules have to do with settling the debts of the testator upon determining his or her assets upon death. The first step in this process is typically paying off all estate taxes. Typically, the amount of estate tax the testator must pay depends on the jurisdiction as well as the net worth of the testator’s estate, as determined by the property deemed applicable in the previous step. Additionally the estate will have to settle any of the testator’s debts to private parties. Probate rules will dictate from where these payments will come and if any of the testator’s planned devisements — property meant to be given away in a will — will be struck in order to pay off the debt.
The final step in the probate process is the distribution of the assets as dictated by the will. The probate rules of the jurisdiction will consider various factors in determining whether the instructions in the will are valid and make any adjustments that the law deems necessary. For example, if a devisement had to be struck in order to pay off the testator’s debt, probate rules may provide an alternative devisement for the person who was supposed to receive the gift.
