Probate & Trust Administration Overview
Estate administration refers to the process of probating the estate of a decedent, which generally includes collecting, inventorying and appraising assets; paying and collecting debts; filing and paying estate taxes; and distributing any remaining assets to beneficiaries. An experienced probate and estate administration attorney from Helsper, McCarty, and Rasmussen Law Firm in Brookings, South Dakota, can help simplify this complicated process. If you need help in the administration of an estate, call Helsper, McCarty, and Rasmussen Law Firm today.
The estate is the total amount of property owned by the decedent at his or her death. Once a person dies, the estate is submitted to the probate court. If there is a will, the probate court will determine if the will is valid and then oversee the administration of the estate by the executor (the person appointed in the will by the decedent to oversee the estate). If there is no will or the will is determined to be invalid, the probate court will appoint an administrator and the decedent's property will be distributed according to the state's laws of inheritance.
The executor is the person named by the decedent in the will to administer the estate. The executor has many important functions to complete, including:
- Gathering and inventorying all assets of the estate
- Appraising the assets
- Collecting any payments or debts owed to the estate
- Paying any debts owed by the estate
- Filing and paying local, state and federal taxes
- Distributing assets to the beneficiaries as stipulated in the will
The executor owes fiduciary duties to anyone who has an interest in the estate. This means that the executor owes a duty of loyalty and must act in the best interests of the estate. For example, if the executor mismanages estate assets and causes the estate to lose value, he or she can be held liable for these actions and may have to repay the estate the amount of the lost value.
Preserving Estate Assets
An important but sometimes neglected responsibility in administering an estate is to look for opportunities to preserve assets for distribution. Reducing estate taxes is one way that an estate can retain more of its wealth for the decedent's heirs. Some of the ways to accomplish this are:
Consider whether administration expenses and casualty losses should be reported on the estate tax return or on the estate's income tax return
Consider whether there are income tax savings opportunities on the decedent's final return (such as whether or not a joint income tax return should be filed with the surviving spouse)
Consider whether assets should be valued at the date of the decedent's death or six months later (or, if assets have been distributed prior to six months after the decedent's death, the date of the disposition of the assets)
Guiding an estate through the probate process and effectively administering that estate requires a keen understanding of probate and tax laws. If you need help administering an estate, our experienced legal team can provide you with the support and guidance you need.