Probate and Estate Administration
After someone dies, a period of administration is necessary to wind up the decedent’s affairs – someone will have to collect the decedent’s assets, pay the decedent’s debts and taxes, finish any outstanding business, and distribute assets in accordance with the decedent’s wishes (that is, if the decedent had a will or revocable trust) or in accordance with Colorado law that governs intestacy succession (meaning, the plan that is in place for people who did not do estate planning).
We open a probate under two circumstances:
(1) if someone dies with a valid will, the will is admitted to probate.
(2) if someone dies without a will and has at least $70,000 of assets titled in her individual name or owns real property.
Probate is a judicial proceeding in which an applicant asks the court to appoint a personal representative (sometimes called an executor). The court grants the personal representative the authority to step into the decedent’s shoes. The personal representative has a fiduciary responsibility to collect the decedent’s assets, wind up any business or legal matters, pay the decedent’s debts and taxes, and administer the estate for the benefit of the beneficiaries. After most of these responsibilities have been met, the personal representative will distribute the probate assts to the beneficiaries and file a document to close the administration with the court.
Some people set up trusts during their lifetime – these may be called living trusts or revocable trusts. If the settlor titled all of his or her assets in the trust during the settlor’s lifetime, then one may avoid probate. There is still a period of administration that is necessary; however, it will be the trustee of the trust who takes on the fiduciary responsibilities of collecting assets, paying debts and taxes, and administering the trust estate for the benefit of the beneficiaries. In these cases, it is the trust document that gives the trustee the authority to manage the decedent’s affairs and not a court. This period of administration may be called a trust administration.
This period of winding up a person’s affairs after their death may be referred to as an “estate administration,” a “probate” or “probate administration,” or a “trust administration.”
Our legal team has a lot of experience in probate and trust administration matters and, if you could not tell from the name, is the area of law that we enjoy the most.
Estate planning, in simplest terms, is planning for your death or incapacity. You may have a will-based estate plan or a trust-based estate plan. In both, you are giving directions about who you want to make certain financial or health care decisions for you if you are unable to manage your own affairs or unable to communicate with your health care provider and how you want your assets distributed after your death. You are also documenting who you want to make these decisions or be responsible for the administration of your estate. If you have minor children, estate planning includes the designation of a guardian who would provide physical care and custody to your children if something happened to you. If you have children (minors or adults), you may want to leave assets in trust for your children’s benefit and estate planning would include the terms of those trusts. Estate planning may include charitable giving. For individuals with gross assets valued at less than $6 million and couples with gross assets valued at less than $12 million, we provide estate planning on a flat-fee basis ranging from $2,500 to $9,000 determined by whether your plan is a trust-based or will-based estate plan, whether you are single or married, whether you have minor children, and to whom and how you distribute your assets after your death.
(i) Wills and Trusts – These instruments are the vehicles that control the disposition of your assets after your death. Revocable trusts also permit a successor trustee to manage assets in the event of your incapacity. Other trusts may be used for more complex estate planning, charitable giving, or for the benefit of pets.
(ii) Powers of Attorney – Financial powers of attorney also called general powers of attorney or durable powers of attorney designate someone else to manage your financial affairs if you are unable to do so either due to incapacity, such as dementia or an injury, or physically being unable, perhaps because of being out of the country. Medical powers of attorney and medical directives designate someone else to make health care decisions when you cannot make them or communicate them to your doctor. Medical directive give directions about life sustaining measures now because you may not be able to give direction later.
(iii) Marital Agreements – We provide marital agreements to our existing estate planning clients, particularly those who are looking to protect their children from a prior marriage upon the client’s remarriage.
Trust Administration (not immediately following death)
There are trusts that are established for the benefit of beneficiaries for a longer period of time (perhaps a lifetime). If you are a beneficiary of a trust or the trustee of a trust that you are responsible for administering for the benefit of others and you have questions about your rights or responsibilities, we can help you navigate those questions.