By: Richard T. Taps, Attorney at Law
© 1995 All rights reserved
If you are a resident of Franklin County, your estate will be “probated” by the Franklin County Probate Court, which is located at 373 South High Street, 22nd floor (462-3894). The Probate Court Judge is Lawrence A. Belskis. Probating your estate merely means a series of legal procedures by which your probate court makes sure that any debts, taxes, and expenses owed by your estate are paid and that all your remaining assets are distributed to your heirs and beneficiaries.
Having an estate “go through probate” does not have to be a scary process. If you are named the Executor under a will or are appointed as the Administrator for someone who died without a will, you will have the responsibility for settling that person’s estate. If you are the Executor or Administrator of the estate of someone who dies in Franklin County, this booklet will help you know what steps have to be taken to probate the estate and transfer other assets that the deceased owned before death.
THE FIRST STEPS
A. Certificates of Death
Certificates of death are needed to probate an estate, for insurance companies to pay out on policies, for a bank to release funds held in a “payable on death” or “P.O.D.” Account, and to transfer other property the deceased owned before death. One question the funeral director will ask you is “How many certificates of death do you want me to order?” In most cases five certificates are sufficient. They cost $7.00 each. Basically, a rule of thumb would be to order two plus one for every institution where the deceased had property before his death. For example, if the deceased had three life insurance policies with one company, only one certificate would be needed. A certificate will be needed to transfer each stock owned by the deceased; however, only one will usually be required to transfer all stocks if they are held in a brokerage account. If the deceased had three accounts at one bank, only one certificate of death would be needed. You generally will need a certificate of death to transfer title to a piece of real estate and to access a safe deposit box. If you would need more certificates later, you should either contact the funeral director or mail a request to the Bureau of Vital Statistics, Columbus Health Dept., 181 Washington Blvd. 43215 (645-7331). State the name of the deceased, the date and location of death, and enclose a check payable to the Columbus City Treasurer and a self-ad dressed stamped envelope.
B. Locating the Will
In a study I did in August 1992, I determined that about 90% of Franklin County residents who died in 1990, having an estate larger than $25,000, had a will. Thus, in most cases the deceased will have a will. If you do not know where it is (or whether there is one), I recommend that you try to find out who the deceased’s attorney was because it may be stored at the attorney’s office. It may be in a safe deposit box of the deceased, in the deceased’s personal papers, or may have been deposited with the Probate court, which for a $5.00 fee, will store your will in a sealed envelope during your life until it is submitted for probate of your estate.
C. Obtaining a Guardian for Minor Children
If the death leaves any minor children (under 18 years old) without any parents, then an application to have someone appointed as guardian must be filed in the Probate Court as soon as possible. if there is a will, it will usually state the preferred guardian of the decedent. This provision is not binding on the Probate Court but will be strongly considered by the Court in deciding who the best guardian would be.
D. Gathering Records to Settle an Estate
You should obtain the following records, look in the following places, and contact the fol lowing people to find out what assets the de ceased owned or claims that creditors may have:
- Trust agreement
- Death certificate
- Birth certificate
- Any bills owed
- Funeral bill and receipt for payment
- Automobile titles
- Banking records
- Certificates of deposit
- Income tax returns for last 3 years
- All prior gift tax returns
- Insurance policies and appraisals
- Medicare and social security information
- Salary and business records
- Pension records
- Credit card statements
- Security brokers’ statements and stock certificates
- Deeds and mortgages
- Art and other collections
- Incoming mail for last several months
- Medical bills
- Safe deposit box information
- Attorney for deceased
Most executors will hire an attorney to handle the legal aspects of settling an estate. How ever, if you obtain most of the information about assets and liabilities and organize that information before hiring an attorney, it will (or should) reduce the legal costs for settling the estate.
E. Social Security Benefits
The surviving spouse may be entitled to a lump sum death benefit of $255 and may be come eligible for social security benefits at age 60. If there are children age 18 or younger, other benefits may be available. You should contact the closest social security office for additional information.
F. Life insurance policies
If you believe that the deceased may have an other policy but cannot find any information, you can send a letter to the Policy Search Division of the American Council of Life Insurance, 1001 Pennsylvania Ave. N.W. Washington D.C. 20004, enclosing a self-addressed stamped envelope. You will be sent a form to complete. There is no cost. For additional information call 1-800-942-4242. The process takes 3 to 6 months for a search of its members’ files.
G. Transfer of Savings and Checking Ac counts Held Jointly or Payable on Death.
The deceased will frequently have checking or saving accounts that are held jointly with another or are payable on death to another. If the surviving spouse is on such an account the bank will generally release 75% of the ac count or up to $5,000 (whichever is greater) if a certificate of death is presented. If another person is on the account, then the bank will release the greater of 75% or $2,500. In other cases a tax release form will have to be presented to release the entire amount in the ac count. Usually, this form is obtained, after the estate is filed in the Probate Court, by completing Ohio Estate Tax forms 12 and 14 and presenting them to the Franklin County Auditor, 373 South High Street, 21st floor (462- 3235).
H. Transfer of Real Estate Owned Jointly with a Right of Survivorship
Although real estate held in survivorship form transfers to the survivor automatically at death, an affidavit of title with a certificate of death must be filed in the Recorder’s office, 373 South High Street, 18th floor (462-3930).
The affidavit must state the name and address of the survivor, the date of death of the de ceased, a legal description of the property, and the deed book and page number of the deed to the property. DTE Form 100 must first be filed in the Auditor’s office on the 20th floor (462-3253) to obtain an exemption from a conveyance fee.
THE PROBATE PROCESS
A. Will my Estate be Probated?
The answer is “Yes” in most cases. This is true even if you owned all or almost all of your assets through a living trust or jointly with rights of survivorship. The Probate Court must determine whether the deceased owned any assets in his or her own name and whether there are any creditors (including the govern ment for taxes due) that have claims against the estate.
However, the only assets that will “go through Probate” are assets owned by the de ceased at death that are to be distributed by the will (or by the Court if there is no will). Below are examples of certain property inter ests that are distributed without “going through Probate”:
- Joint title with rights of survivorship
- Payable on death accounts
- Life insurance policies payable to beneficiaries
- Annuity policies payable to beneficiaries
- IRAs with named beneficiaries
- Assets titled in a Revocable Living Trust
- Even though the above assets do not go through Probate and therefore are not listed on the Probate asset list, they must be listed on state and federal tax returns so that the applicable state and federal taxes are paid. Thus, if you hire an attorney, you should prepare a de tailed list of all assets, whether probate or nonprobate.B. What Happens to My Estate if I Die without a Will?
Your assets will be distributed to your heirs according to a specific schedule required by Ohio law. Below is the order of priority that applies in most cases:
- If your spouse survives you, but you have no children or grandchildren, your spouse inherits all.
- If your spouse and more than one child are living, the spouse receives the first $60,000 (or $20,000 if the spouse is not the natural or adoptive parent of at least one child) and 1/3 of the balance. The remaining balance is divided equally among the children. If one of your children dies before you, leaving you with a grandchild or grandchildren, the grand children receive your deceased child’s share.
- If your spouse and one child are living, then the spouse gets the first $60,000 (or $20,000 if the spouse is not the natural or adoptive parent of the child), and the balance is split between the spouse and child. (Same rule for grandchildren as above.)
- If there is no surviving spouse, then the estate is distributed in equal shares to the children. (Same rule for grandchildren as above.)
- If there is no spouse or child or grand child, then your estate is distributed to your parents.
- If there is no spouse, child, grandchild, or parent, then your estate is distributed to your brothers and sisters or their surviving children or grandchildren.
There are other possibilities that are extremely unlikely. If you do not have a will and would not like your assets to be distributed as above, then you should consider contacting an attorney to have a will prepared for you.
C. Are there Different Kinds of Probate Proceedings?
Yes. There is a “Release from Administration” procedure for certain estates under $35,000 (or under $85,000 if the only beneficiary is the surviving spouse), and a “Full Administration” procedure for all other estates.
- Estates under $35,000
If the Franklin County Probate Court is furnished satisfactory proof that the probate assets of an estate are less than $35,000 in value and that the creditors will not be harmed, then the Court will, after proper notices have been given, order that the estate be relieved from administration and order delivery of personal property and transfer of real estate to the persons entitled to them. (If the only beneficiary is the surviving spouse, the estate will be relieved from administration if the probate assets are less then $85,000.)There are forms that must be filed with the Court. If there is a surviving spouse and the probate assets are less than $7,200 or no surviving spouse and the probate assets are less than $2,200, there is a set of “short forms” that must be filed. There is a set of long forms for other estates under $85,000. These forms can be obtained from personnel at the no- administration desk at the Probate Court. The Court will not mail them to you.
- Estates over $35,000
If the release from administration procedure is not appropriate or probate assets exceed $35,000, then there is a full administration procedure that requires additional documenta tion and time to settle the estate. Below are the essential steps that are taken in settling an estate where the person died with a will:
- Application to Probate Will
An Application to Probate Will is filed with the Probate Court. The original will is filed. Beneficiaries named in the will, and those that would have been heirs if there had been no will, must in writing waive notice of the filing or must be notified by certified mail that the will has been filed.
- Appointment of Executor
An application for authority to administer the Estate is filed. This application specifies who was named as Executor under the Will and states the estimated value of the Estate. The Probate Court will usually authorize the Executor named in the Will to administer the deceased’s estate. The Court issues Letters of Authority that appoint the Executor. These Letters are necessary for the Executor to transact business of the Estate.
- IRS and Forwarding of Mail
After appointment, the Executor should usually file Form SS-4 with the IRS to obtain a federal tax identification number for the Estate. If the Executor lives at a different address than the deceased, Form 56, Notice Concerning Fiduciary Relationship, should be filed so that tax notices will be sent to the Executor. If there is no surviving spouse, the Executor should consider having the deceased’s mail forwarded to him or her. The Executor must present Letters of Authority at the Post Office to have the mail forwarded.
- Inventory and Appraisal
Within 90 days of appointment, the Executor must file in the Probate Court an inventory of the real estate located in Ohio and personal property owned by the deceased. Only probate assets are listed on this inventory. If the value of any of the assets (such as real estate) is not readily known, an appraiser may have to put a valuation on the assets. A hearing will be scheduled not more than 30 days after the inventory is filed.
- Paying Creditors and Taxes
From the assets of the estate, The Executor must pay all valid debts owed by the Estate and any taxes due. Creditors have up to one year after date of death to file claims against the estate. The Executor may have to file state and federal income tax returns for the deceased, state and federal income tax returns for the estate, an Ohio Estate Tax return, and if applicable, a federal estate tax return.
- Final Accounting
A final accounting of the estate’s assets and debts is filed after the payment of debts and taxes owed by the estate. The final ac counting shows the value of all estate as sets, along with any income or interest earned, debts paid, money owed, and tax payments. It also shows the distribution of the assets to the beneficiaries named in the Will. The final accounting must be approved by the Court.
- Closing the Estate
Following the approval of the final Ac counting, the Estate is Closed.
- Application to Probate Will
HOW LONG DOES PROBATE TAKE?
In most cases probate takes six months to a year from the date the Will is filed with the Court to the final distribution of assets. In August 1992, I studied 203 estates that were filed in the Franklin County Probate Court in 1990. I found that 65% of the estates were closed in less than 12 months. The average time for all 203 estates was 11.6 months.
HOW MUCH DOES PROBATE COST?
A. How much are Court Costs?
The average court costs for 2002 full estates that were closed in July 1992 was $185.66. The average court costs for a “Release from Administration” estate is about $90.00. In addition, appraisal fees for real estate are $1.50 per $1,000 for the first $200,000 of valuation and $1.00 per $1,000 in excess of $200,000. The minimum appraisal fee is $75.00.
B. Executor Fees
An Executor is entitled to fees according to the following schedule:
- Four percent of the first $100,000 of personal probate assets, income from personal assets, and proceeds from sale of real estate;
- Three percent of the assets in the $100,000 to $400,000 range;
- Two percent of the assets above $400,000;
- One percent of the value of real estate not sold; and
- One percent of all nonprobate assets that are includable as assets for Ohio Estate Tax purposes, except for property owned jointly with a right of survivorship (JROS).
If, for example, an estate had $400,000 of personal assets and income, $200,000 of real estate that is not sold, and $200,000 of nonprobate assets (other than JROS) then the Executor would be entitled to a fee of $17,000.
Executor fees are paid infrequently because the Executor is usually either the surviving spouse or a primary beneficiary of the Estate, and they waive any right to these fees be cause the fees are taxable income for federal tax purposes.
C. Attorney Fees
In August 1992 I conducted a study of estates filed in Franklin County Probate Court. I re viewed the files of 203 estates that were filed during 1990. (These estates all exceeded $25,000) The results are as follows:
Average Size of all Estates: $208,393. This includes any assets that the deceased had an ownership interest in at the time of his death, including as a joint tenant, life insurance, P.O.D. bank accounts, and assets held in a living trust. 55% of the estates were less than $100,000.
Average Size of Estates–no will:
Average Size of Estates–with will:
Average Amount of Attorney Fees:
$4619 (all estates)
Average Amount of Attorney Fees–no will:
Attorney Fees–with will:
Amount of Attorney Fees for Estates between $50,000 to $100.000:
Average % of Attorney Fees for all Estates:
Average % of Attorney Fees–no will:
5.34% (This higher percentage shows why it is good to have a will. The cost of deter mining who the beneficiaries are, locating them, and notifying them increases the attor ney fees for handling an estate.)
Average % of Attorney Fees–with will:
Average % of Attorney Fees for Estates between $50,000 to $100,000:
2.22%. (The average size of the estates was $84,700.)
Before any legal services are provided, the executor should require the attorney to agree in writing what amount will be charged for the representation. The fee may be based on a certain percentage of the size of the estate. Billing on a fixed fee or hourly basis may be more economical for the estate.
HOW DO YOU FIND AN ATTORNEY?
You should ask an attorney you are considering what experience he has in probate. Talk to friends, relatives, business associates, or someone you believe has been an executor to find whether they have any experience with an attorney they can recommend. There are two referral services. First, you can call the Columbus Bar Association Lawyer Referral Ser vice at 221-0754. Second, you can call PRO Seniors, a nonprofit organization located in Cincinnati, at 1-800-488-6070. Over 8,000 calls are made to the hotline each year.
FOR MORE INFORMATION
We hope this booklet is helpful, especially if you have just lost a loved one. If you need additional information or another copy of this booklet, feel free to call me at (614) 436-8000.
Richard T. Taps Attorney at Law
PUTTING YOUR HOUSE IN ORDER
Complete this section and let your executor know where you keep this book.
Full name _______________________________
Social security number _____________________
Date of birth _____________________________
Name of spouse
Location of birth and marriage certificates:
Names, addresses, and phone numbers of children: ________________________________________
Prearranged funeral? _____________________
If yes, where _________________________
If no, I prefer the following funeral home:
Own cemetery lot? ________________________
If yes, where? ___________________________
If yes, my discharge papers are kept at: ________
Location of will and trust:____________________
Location of safe deposit box and key:__________
Location of other important records: ______
My checking and savings accounts are at:_______
Insurance agent’s name and phone number:
My tax return for last year is kept at: __________
Accountant’s name and phone number:_________
Executor’s name and phone number:___________
Other important people and phone numbers:_____
Other instructions for my executor:__________