The probate process is full of language that is widely assumed to mean one thing, when it technically means something different or narrower. Executor duty generally consists of administering a deceased person’s (decedent’s) estate. In fact, an executor is the title given to someone tasked with managing the estate of a person who died with a will (testator).
Someone who died without a will is said to have died “intestate” and the person in charge of their estate is called an “administrator.” Administrators and executors collectively are called “personal representatives.”
Similarly, many people assume that an “heir” is someone who inherits from a decedent. What the term really means is a person who would be entitled by law to inherit from someone who died intestate, often a child or grandchild, but perhaps a parent, sibling, aunt, uncle, or cousin. (Spouses, while they have priority to inherit, are not considered “heirs.”) “Beneficiary” is the technical term for someone who inherits under a will or trust. An heir need not be a beneficiary (like a child who has been disowned). A beneficiary need not be an heir (like a friend named in a will… Read More
Most people have heard the term “next of kin,” usually in connection with a deceased person. Who is “next of kin,” and why does it matter? In the probate setting, it is important to identify someone’s legal next of kin when they have died without a will and their estate must be managed and assets distributed.
If a deceased person (decedent) has died with a will, it almost certainly identifies a person whom the decedent selected to administer the probate estate. This person is often a close relative, but need not be. The executor named in the will has no legal authority to act on behalf of the estate until they are appointed by the court.
If there is no will, however, the decedent’s next of kin has priority to be appointed as administrator of the estate. The administrator has numerous responsibilities, including identifying all interested parties and notifying them of the probate proceedings; securing the property of the estate; and paying all legitimate debts of the estate before… Read More
Attorneys who offer estate planning and business succession planning services are not just in the business of passing assets to the next generation. We are in the business of helping to protect those assets too. Asset protection involves ensuring that as many assets as possible are outside the reach of creditors and the bankruptcy courts.
While bankruptcy is sometimes necessary and/or the best option for a fresh financial start, it can expose hard-earned assets to seizure and liquidation by the bankruptcy trustee. It is not always possible to predict whether you (or one of your heirs or beneficiaries) will need to file for bankruptcy. But it is possible to take asset protection measures just in case.
Bankruptcy laws provide for certain types and amounts of properties to be “exempt,” placing them outside the reach of the bankruptcy trustee. In addition, there are certain strategies that are “exemption-like,” which end up offering similar protection.
For many individuals, their interest in a business is one of their most valuable assets, not only from a financial standpoint… Read More