» Probate Process
You can’t take it with you—and in addition to leaving your money behind, chances are you’ll leave some unpaid bills behind, too. What happens to your debts after you die?
The short answer is that they get paid out of your probate estate according to a priority established by Ohio law. Creditors must present a claim within 6 months of the date of death, after which time the executor or administrator of the estate has thirty days to reject or allow the claim.
In many states, the executor or administrator of the estate is required to give notice to creditors of the deceased. If there are known creditors, they must be notified directly, while an advertisement is placed in legal newspapers to provide notice to unknown creditors. However, in Ohio, there is generally no such notice requirement. That said, there are a few exceptions to that rule.
When Must an Ohio Personal Representative Make a Notice to Creditors of Probate?
The first situation in which an Ohio personal representative must publish n… Read More
Probate is the court-supervised process of administering a deceased person’s estate after their death. Ohio probate courts are also involved in appointing guardians for people who lack the capacity to manage their own affairs. These processes can be emotionally charged, and it is not uncommon for family members to have disputes about how estate business should be handled or who should be appointed administrator or guardian. These disputes have historically been resolved by litigation in the probate court.
Probate litigation may result in a definitive answer about the issue at hand, but probate matters are often also about conflicts that a court cannot effectively address. In recent years, probate mediation has become more popular as a way of reaching deeper, more lasting resolutions to the issues involved in probate disputes.
What is Probate Mediation?
Probate mediation is a form of alternative dispute resolution in which a neutral third party, a trained mediator, helps parties to a probate dispute reach a mutually agreeable resolution… Read More
When an Ohio resident dies, a personal representative must be appointed to administer their estate. If there was a will, the probate court often appoints the executor named in the will. If the deceased did not have a will, the court will appoint an administrator (typically a close family member) to serve as personal representative of the estate.
The personal representative is a fiduciary — someone obligated to act in the best interests of another party, rather than their own. In the case of a decedent’s estate, this person is obligated to follow the law and act in the best interests of the heirs or beneficiaries of the estate. Most representatives take their fiduciary duties very seriously. Sometimes, though, an executor or administrator commits a breach of fiduciary duty, or there is so… Read More
These days, it seems you can find people, even those you haven’t seen in years, in a matter of moments. A quick internet search can find that long-lost friend or second cousin, yielding social media accounts, emails, phone numbers and even physical addresses. It may feel as if it is impossible to escape the sticky tendrils of the aptly-named “world-wide web.” Even in death, digitized Social Security death records, ancestry sites, and websites like findagrave.com mark a person’s existence and passing.
Most people, when creating or updating a trust, don’t anticipate the possibility that one of their beneficiaries will simply disappear without a trace. Yet this very outcome happens with disturbing frequency. Online trails may go cold, and there may be no conclusive evidence that a beneficiary has died. What happens to a trust when a beneficiary is living off the grid, or perhaps not living at all?
How Does a Beneficiary Disappear?
It may seem impossible that someone who is the beneficiary of a trust would walk away from thousands or hundreds of thousands of dollars,… Read More
Administering an Ohio estate can be challenging for personal representatives, and there is usually a sense of relief and satisfaction when the process is successfully completed. But what happens when an estate is closed, and it is later discovered that the state of Ohio was holding unclaimed funds for the deceased? Does the estate need to be reopened?
Historically, the answer to that question has been yes, resulting in additional paperwork, effort and expense, sometimes to recover only a relatively small amount of money. Fortunately, House Bill 270, which was passed unanimously by the Ohio House, may change all that, making the process of reclaiming previously unclaimed funds on behalf of an estate much more straightforward.
The bill, which makes multiple changes to the Unclaimed Funds Act of Ohio, creates a procedure that streamlines the process for small or closed estates to claim funds that belonged to a decedent and which lay unclaimed with the state. The proposed Ohio Revised Code 169.052 is expected to pass the Senate without difficul… Read More
Nothing is certain except death and taxes—and the headaches that result when the two intersect. Rarely do people die with their finances neatly tied up, and one of the frequent issues that arises is the matter of the deceased person’s (decedent’s) last income tax refund.
If a person dies being owed an income tax refund (as thousands of people do every year), what happens to the money? Obviously, the decedent cannot cash a check made out to him or her. A refund in the sole name of the decedent is an asset of the decedent’s estate. Eventually, it will be distributed to the decedent’s heirs or beneficiaries (assuming there is money left in the estate after all legitimate debts are paid). But what happens in the meantime? And what if the tax refund is from a tax return jointly filed with a… Read More
These days, people move around more than ever. You might buy a house in Dayton, get transferred out of state for work, and continue to rent out the Ohio property. Or you might spend most of your life in Ohio, only to spend your later years living with an adult child in a neighboring state. Whatever the reason, there are many people who live outside of Ohio, but continue to own real property in the state. When they die, that real property needs to be disposed of. Ancillary probate in Ohio is one mechanism to deal with real property whose owner died outside of the state.
Ancillary probate is addressed in Chapter 2129 of the Ohio Revised Code. If a resident of another state dies owning property in Ohio, someone must apply to be appointed ancillary administrator in the county in Ohio where property of the deceased person (decedent) is located. If the decedent had a will, the person named as the executor in the will is generally eligible to serve as the ancillary administrator of the Ohio estate. If the decedent did not have a will (they died intestate), the ancillary administrator must be a resident of the county in which the property is located.
As a practical matter,… Read More
A new omnibus bill, HB 595, has made some changes to Ohio probate law that could affect your will or trust. The law is far-reaching, and contains much more information than we can address in a single blog post, but there are some developments in Ohio probate law that could have an impact on you or your loved ones. Here are some of the important developments from Ohio HB 595.
Incorporating a Trust into a Will
Prior to the effective date of HB 595, an existing document could be incorporated into a will "by reference." This means that simply by referring to a document, book, memorandum, or record in a will, the document could become part of the will. The actual document had to be deposited in the probate court at the time the will referring to it was probated, within 30 days afterward, or later if the court granted an extension of time for good cause.
HB 595 provides that if a will incorporates a trust instrument only under the circumstances that a bequest to a trust is ineffective, the trust instrument needs to be deposited in the probate court within 30 days of a final determination that the bequest was ineffective.
In addition, HB 595 that if it is… Read More
In Ohio, as in other states, attorneys who assist a personal representative in the administration of an estate are entitled to have their reasonable fees paid out of the estate. Attorney fees are governed not only by ethical guidelines established by attorneys' Rules of Professional Conduct, but by other Ohio rules and statutes. As such, attorney fees in estate administration are perhaps some of the most strictly regulated. Although attorney fees are paid out of the estate, Ohio case law has established that it is the personal representative, rather than the estate itself, who is the attorney's client.
What is a reasonable attorney fee for estate administration, and how is it determined? Essential guidance comes from Rule of Professional Conduct 1.5 (Rule 1.5), which states that a "lawyer shall not make an agreement for, charge, or collect an illegal or clearly excessive fee." A fee would be illegal if it violated a statute or some administrative regulation. A fee would be considered "clearly excessive" if an attorney of ordinary prudence would be left with a "definite and firm conviction" that the fee was excessive.
Factors in Determining Whether an Attorney Fee… Read More
Probate litigation is on the rise, in Ohio and across the United States. One possible reason for the uptick in cases is tied to the increase in divorce over the last several decades. More people divorcing means more people remarrying, which means children from a first marriage might be pitted against a stepparent or step-siblings when it comes time to inherit. Of course, there are other reasons there might be an fight over a will or trust. A close relative who receives a smaller inheritance because of a bequest to a friend or caretaker might be suspicious that that person exerted "undue influence" over the deceased. Much, if not most, probate litigation regarding the validity of a will or trust is based on claims of undue influence. Let's take a look at what is involved in identifying (and proving) undue influence.
Proving Undue Influence in Ohio
The same scenario could be looked at in two completely different ways. Let's say that Mary is an older woman with limited mobility whose only child, Jeff, lives across the country. He rarely visits Mary, though he calls once a week or so. Mary has a neighbor, Tim, who drops by regularly. He helps her with things like cha… Read More