When a loved one dies and you are the person responsible for handling their estate, it’s helpful to have a roadmap as you begin to navigate what is typically unfamiliar territory. Deciding which direction to take for any estate administration begins with asking some questions, such as:
What is probate and do I need one?
Probate is a court process that is sometimes necessary after a person dies to administer their estate. Administration of an estate can include accessing assets, closing accounts, selling real estate, paying bills and taxes, and ultimately, making distributions to beneficiaries.
Whether or not a probate is required to complete these steps depends on a variety of factors, including the status of assets owned at death (such as how assets are titled and any beneficiary designations).
For example, when a person owns real estate at death, there is a good chance probate will be required. It’s important to confirm this before taking action related to the real estate, including removal of personal property, having an estate sale, making repairs/improvements, and/or beginning any process to sell the real estate.
I am the Personal Representative (or Executor) named in the Will, so I’m in charge, right?
Perhaps, but it’s not automatic.
Being named in someone’s Last Will and Testament as the Personal Representative (or Executor) means you have been nominated to serve in that role, which is the first step.
To have the authority necessary to act as Personal Representative (or Executor), you must first be appointed by the court in a probate proceeding.
Am I an Executor or Personal Representative?
These terms are used interchangeably to describe the person with fiduciary authority and responsibility to administer a Decedent’s estate, when appointed by the court in a probate proceeding. In Nebraska, we use the term Personal Representative. In some other states, including Iowa, the term Executor is used.
What if there is no Will?
If a person dies without a Will, in legalese, we refer to that as intestate or intestacy.
It may still be necessary to open a probate and have a Personal Representative appointed by the court to administer that intestate estate. The process for doing so is just a bit different than if there is a Will.
An experienced estate administration attorney can help you confirm if a probate is necessary and, if so, who is eligible to serve as the Personal Representative via the rules for intestate probate administration.
Specific rules also govern who the intestate heirs of the estate will be.
Even if a probate is not needed, what about Nebraska inheritance tax?
While there are a number of estate planning strategies that can be used during life to avoid the need for probate after a person dies - such as Trusts, Beneficiary Designations, or Transfer on Death Deeds - utilizing them does not bypass Nebraska inheritance tax requirements.
Generally speaking, other than beneficiary designated life insurance, assets owned by a Decedent at death are subject to Nebraska inheritance tax.
Nebraska inheritance tax is different and separate from the federal estate tax or any income tax.
Nebraska inheritance tax is a court process. Even if no Nebraska inheritance tax is due, it may still be necessary to obtain a court Order confirming no tax is due.
An important first step for any administration - including estates that appear straightforward or have just a few assets - is to consult with the right attorney to confirm what you need to do and how to make it happen. Attorneys experienced in estate administration are uniquely qualified to guide you, and your best resource for smoother sailing through the process, especially if you encounter any hiccups or rough waters along the way.