When property passes by probate, it means that the state courts supervise the disposition of the property. If the person left a valid will, the courts supervise to ensure that the terms of the will are followed. If the person did not leave a valid will, the courts follow the state law for intestacy. Many states have a special court that handles probate, often called a probate court or an orphans court. The difference is in name only, and they all function very similarly.

The executor (personal representative) is the individual who carries out the instructions in your will. This is not an honorary role.

There are many financial and administrative tasks
involved in being an executor

• gathering all your assets

• preparing an inventory for the probate court

• completing paperwork to change the title of assets from the decedent to the estate

• making periodic reports to the probate court

• paying all your debts and taxes

• defending your estate against any lawsuits or other difficulties

• distributing your assets as you direct in your will.

In general, the probate process includes the following steps

1. After the decedent dies, the executor takes the decedent's will and a certified copy of the death certificate to the probate court. The executor generally needs the following information:
   

   1. the names and addresses of the decedent's surviving spouse, children, and other persons who either are mentioned in the will or would inherit under the laws of intestacy

   2. the approximate worth of the decedent's estate

2. The court officially appoints the individual nominated in the will as executor. The court provides the executor with letters of testamentary (also called letters of administration). (If the decedent had no will, certain individuals can take the death certificate to the probate court and be appointed the administrator of the estate.)

3. The executor or administrator normally must post a bond to fulfill the duties of executor. In some states, not only must the executor sign a bond, but a third party is also required to guarantee the bond by posting surety. Surety is obtained through a bondsman or insurance company. The cost of surety is paid by the estate.

4. The letters of testamentary and the death certificate are the proof needed for the executor to take personal control and possession of the decedent's probate property. The executor normally opens a bank account in the name of the estate (e.g., Estate of John Doe) and either transfers existing assets to the new bank account or changes the name on existing accounts and assets to the name of the estate. To open the bank account, the executor must first obtain a taxpayer identification number from the Internal Revenue Service (IRS).

5. Once the executor has gathered the decedent's property, an inventory is normally filed with the probate court showing all of the decedent's property. This inventory is a public record. Under the rules of the court, the executor may be required to furnish each heir with a copy of the inventory.

6. The executor is responsible for paying the debts and expenses of the decedent in the proper order under state law. There is a time period for creditors to make claims against the estate. Sometimes a creditor makes a claim against the estate that the executor cannot be sure is valid. In that case, the executor must seek guidance from the court as to whether or not the claim is valid and should be paid. The executor must be sure to pay the debts in the proper order as required by that state's laws. If an estate is insolvent, meaning the decedent's debts were greater than his assets, the state law will direct which creditors are to be paid first. If an executor pays a lower-ranked creditor before a higher-ranked creditor, the executor will be liable for the difference.

7. The executor is responsible for paying any federal and state estate taxes that are due. The executor must also pay any probate fees that are assessed. If the estate (including certain lifetime gifts) is greater than the applicable exclusion amount shown in the table below, the executor is required to file a federal estate tax return. A state estate tax return may be required, even if a federal estate tax return is not required, depending on the state's tax laws.

   Year of Death	Applicable Exclusion Amount
   2008	$2,000,000
   2009	$3,500,000
   2010	unlimited
   2011	$1,000,000

   If a federal estate-tax return is required to be filed, the executor normally waits for what is called the closing letter from the IRS before making distributions to the beneficiaries. This tells the executor that all federal estate taxes have been paid.

8. During the probate administration, the executor is responsible for filing accountings with the probate court showing the gains and losses of the assets reported on the inventory.

9. Once all expenses, taxes, and debts are paid, the executor can distribute the remaining estate assets in accordance with the terms of the will. It is a good idea for the executor to get signed receipts when distributing property to the heirs.

10. After distributing the estate, the executor makes a final accounting to the court, showing the probate court who received what property.

Probate Advantages

• The initiation of probate starts the clock on limiting the time that creditors have to make claims against the estate. Creditors who fail to make claims within the allowed time (statute of limitations) find that their claims are no longer enforceable.

• Supervision by the court assures that the estate is distributed in accordance with the will.

Probate Disadvantages

• Probate records are public documents, so anyone can go to the courthouse and read your probated will.

• There are additional costs associated with probate.

• Probate may extend the time needed to complete the distribution and to settle the estate.