Divorce Lawyer Magna Utah

Tuesday 23 May 2023

How Long Does it Take to Receive Inheritance from a Will After Probate is Granted

How Long After Probate Is Granted Does It Take To Receive Inheritance

One common question we often encounter is: ‘how long does it take to receive inheritance from a will?’ The answer largely depends on the probate process. It’s not uncommon for the beneficiaries of a will to become impatient with estates’ executors as the probate process drags on and on. However, the executor may not be moving slowly. She must complete several tasks before she can make the decedent’s bequests to his beneficiaries. If she jumps the gun and distributes bequests too soon, the court holds her personally responsible if she runs out of money to pay the decedent’s taxes and debts. You’ll usually get the grant of probate (or letters of administration) within 8 weeks of sending in your original documents. You should not make any financial plans based on the date you expect to receive it, as it may take longer.

Get access to financial assets

You can ask for financial assets to be transferred to an agreed ‘executorships account’. This can be either:
• an executor’s bank account
• an account that’s been set up only for dealing with the estate
Every executor named on the grant of probate may need to be present when you withdraw assets. Different asset holders have different rules, so check with them first.

Pay debts

As the executor or administrator you must pay off any debts or outstanding payments before distributing the estate. This could include:
• outstanding bills
• tax owed
• benefit overpayments
Place a notice in The Gazette to give creditors the chance to claim anything they’re owed. This will protect you from responsibility for any debts. You can use money from the estate to pay any solicitor’s fees as part of the probate process.

Money in a joint bank account automatically passes to the other owners. You still have to include this money as part of the estate when you work out Inheritance Tax. If the person who died owned the whole of the home with another person (‘joint tenancy’), ownership passes to the other owner. Otherwise, their share goes to the beneficiary named in the will.

Distribute the estate

Once all debts and taxes have been paid, you can distribute the estate as detailed:
• in the will
• by the law if there’s no will
Beneficiaries may have to pay Income Tax if the assets they inherit generate income for them. After this you can prepare the estate accounts. These must be approved and signed by you and the main beneficiaries. Oftentimes, one of the first questions that a beneficiary of an estate or a trust asks is, “When will I get my inheritance?” Unfortunately for the beneficiary, handing out the inheritance cash or checks is the very last thing that the Personal Representative of the estate or Successor Trustee of the trust will do.

The Personal Representative or Successor Trustee has to take the following steps before the estate can be closed or the trust can be terminated:

• Inventory the decedent’s documents and assets. Before a Personal Representative can be appointed by the probate court or a Successor Trustee can take over the administration of a trust, all of the decedent’s estate planning documents and other important papers must be located. The decedent’s estate planning documents may include a Last Will and Testament, funeral, cremation, burial or memorial instructions, and/or a Revocable Living Trust. The decedent’s important papers may include bank and brokerage statements, stock and bond certificates, life insurance policies, corporate records, car and boat titles, and deeds; and information about the decedent’s debts, including utility bills, credit card bills, mortgages, personal loans, medical bills and the funeral bill.
• Get appointed as Personal Representative of the probate estate or accept appointment as Successor Trustee. Once the decedent’s important documents are located, if probate is necessary then a Personal Representative will need to be appointed by the probate court, or if the decedent had a Revocable Living Trust, then the Successor Trustee will need to accept appointment.
• Value the decedent’s assets. Once the Personal Representative or Successor Trustee is in place, then the date of death value of the decedent’s assets will need to be determined. This will be important information for the beneficiaries since capital gains will be calculated using the date of death value versus the value when the inherited property is sold (resulting in a step down or a step up in basis). In addition, the total value of the decedent’s assets reduced by outstanding debt will determine if the estate or trust will be subject to state estate taxes, state inheritance taxes, and/or federal estate taxes.
• Pay the decedent’s final bills and ongoing administration expenses. Once the value of the deceased person’s assets has been established, the Personal Representative or Successor Trustee will need to pay the decedent’s final bills, such as cell phone bills, credit card bills and medical bills, as well as the ongoing expenses of administering the estate or trust, such as storage fees, utilities and attorney’s fees.
• File applicable tax returns and pay applicable taxes. In addition to paying the decedent’s final bills and ongoing administration expenses, the Personal Representative or Successor Trustee will also need file all applicable estate tax returns and/or inheritance tax returns (state and/or federal: IRS Form 706), the decedent’s final income tax return (state and/or federal: IRS Form 1040), and initial and final estate or trust income tax returns (state and/or federal: IRS Form 1041). Of course, any taxes that are due must be paid in a timely manner to avoid interest and penalties.

• Distribute what’s left to the beneficiaries. And so we come to the very last step in the process of settling an estate or trust – write the inheritance checks to the beneficiaries. This is the very last step because if the Personal Representative or Successor Trustee fails to take care of all five of the prior steps and simply gives the beneficiaries their share of the estate or trust, then the Personal Representative or Successor Trustee will be held personally liable for all of the decedent’s unpaid bills, the administrative expenses, and all unpaid taxes.
There is quite a bit involved in settling an estate or trust. But in general, how long does the settlement process take will depend on many factors, including the types of assets the decedent owned, the value of those assets, whether the estate is taxable at the state and/or federal level, how many beneficiaries are involved, whether the beneficiaries get along, and the skills and diligence of the Personal Representative or Successor Trustee. Taking these factors into consideration, a simple estate or trust may be settled within a few months, while a complicated estate or trust may take one or more years to settle. Wills and inheritance Dealing with a Will can be difficult, especially when you’re grieving your family member or friend.
The main purpose of the Will is to:
• appoint one or more people (called executors) to carry out the instructions in the Will and the other tasks involved with administering the person’s estate
• set out instructions about passing on the estate of the person who’s died (any property, money and possessions).
Finding a Will
In most cases the Will should be easy to find, but sometimes it isn’t quite so straightforward. If you already know who the executor is, they may know where to find the Will. For example, it could be in the financial paperwork of the person who’s died, or it might be stored with a solicitor or bank. The executor will have responsibility for administering the estate and will often take a key role in arranging the funeral. If the person who died had a bank account, tell the bank that they have died. The bank will normally allow the executor to immediately pay funeral expenses from the account, providing the account has money in it and the executor can provide a copy of the death certificate and the original funeral invoice. Dying without making or leaving a valid Will is called dying intestate. The estate will still need to be sorted out and the person who takes on this task is called the administrator. Usually this will be the next of kin. If there’s no Will, a person’s estate will be distributed according to rules of intestacy set out in law. The intestacy laws don’t pass anything on to an unmarried partner, stepchildren, friends, charities or other organizations. However, if you were financially dependent on the person who died, you may be able to claim a share of their estate (this may include their home). This could also apply if you were co-dependent with them for example, if you shared household bills. But you’ll need to get advice from a solicitor about this. If a person leaves a Will but the instructions in it don’t cover the whole estate, then intestacy laws will apply to the bit that’s not covered. This situation is called partial intestacy. Partial intestacy can also apply if the Will appoints executors who have already died or don’t wish to take on the role, and an administrator needs to take over.

Receiving an inheritance

You may have been left money, property, investments or other things by the person who died. The inheritance tax on the person’s estate is paid before you get this money or other items. The executor or administrator (the person in charge of distributing the estate of the person who’s died) has to pay off any debts before they can pass over money and items to the people inheriting them. If you’ve been left an asset (e.g. a property) in the Will, but there isn’t enough money in the estate to pay the person’s debts, the item you’re due to inherit may need to be sold. You can get advice from a solicitor on this. Sometimes, when you’ve been left money, the executor or administrator may ask if you’d like to accept some assets instead. It could be jewellery, or some antiques, depending on what’s in the estate. You don’t have to agree to this. You don’t have to accept an inheritance at all if you don’t want to. If you refuse it, the executor or administrator decides who gets it instead. It’s possible to change the Will of a person after they’ve died as long as anyone who’s inheriting and would be made worse off by the changes agrees to it. To do this, you need a deed of variation. This can be complex, so it’s best to get advice from a solicitor. The variation must be made within two years of the death.
All probates open with submission of the will to the court. Generally, the executor named in the decedent’s will takes care of this, and she applies for official appointment at the same time. Depending on your state, court appointment can take anywhere from a few days to a few weeks. Therefore, if you’re trying to gauge when your inheritance might become available, you can reasonably expect that the probate process won’t even begin for about two weeks. Some states, have statutory delays built into the probate process for heirs and beneficiaries to contest the will. A will is not even accepted for probate in Utah until 10 days have passed from the date of death, allowing anyone who wants to object to the will to do so during this time. If your state’s code has such a provision, add at least an additional week, or about a month overall.

Inventory and Valuations

After an executor takes office, she has a period of time in which to prepare an inventory of the decedent’s assets for the court. This includes a list of all his property, as well as values. Values of significant assets, such as real estate, require appraisals, and a professional appraisal can take more than a month to complete. In Utah, an executor’s deadline for accomplishing all this is three months, but she can ask for an extension. Three months is a typical time frame for this step. Therefore, you can expect that probate of the will won’t reach this point until approximately four months have passed. After the oath swearing, the grant of probate usually takes between 3-4 weeks to be received. The remaining probate process usually takes up to 6 months to complete but can easily go past 12 months. The revenue and customs authority can take up to five months to process capital gains tax and the inheritance tax. You should pay inheritance tax to make sure the process takes the shortest time possible to complete. Therefore the probate cost will vary depending on the deceased person’s assets and property value. Generally, as you can see, the higher the value of the asset, the more the probate costs.
A grant of representation is a legal document that an individual should acquire to deal with the deceased person’s estate. This document confirms your legal status and your ability to deal with all things related to the Estate of the person that has died. You should also note that the grant of representation may still be needed irrespective of whether the person that died left a Will. The testator usually appoints the person who should serve as the executor. If the will of the testator doesn’t nominate such a person, it won’t be possible for one party to apply for probate. In such instances, one of the beneficiaries is allowed to apply for legal documents allowing them to act as administrators.
If the deceased’s will (or a later will) is discovered after the grant of probate has already been issued, the original grant can be revoked by a district judge or registrar. On the late discovery of a will the grant can be revoked:
• if a will has been discovered where there was thought to be no will, after the grant of the letters of administration; or
• if a later will is discovered, after the grant of probate.
If a codicil to the deceased’s will is discovered after the grant of probate has been already issued, it can be sent to the Probate Registry on its own (without the need for revoking the grant of probate) providing it does not change the deceased person’s executors. If the codicil does change the executors, the original grant of probate must be revoked.
Other instances where the grant may be revoked include:
• if the grant has been made through a lack of care (this may be referred to as per incuriam); or
• if the name of the deceased as stated on the grant is incorrect.

Consequences of revocation

If the grant is revoked, a new grant of probate should be applied for according to the terms of the new will. If the estate has been distributed already the new personal representatives should seek specialist professional advice on recovering the incorrectly distributed parts of the estate in order to correctly distribute the assets. The recipient of any cash gifts (who would not be entitled to the legacy under the new will) may be liable for the full sum. If the existing grant of probate or letters of administration is revoked, the personal representatives may be concerned about their liability for incorrectly distributing the deceased’s estate. The personal representatives may be protected from liability provided the court is satisfied that they acted in good faith and believed there was no will or the original will was valid at the time of making the distribution. Provided the court is satisfied, the personal representatives may retain or reimburse themselves in respect of any payments and/or dispositions made under the original grant.

Probate Lawyer in Utah Free Consultation

When you need to receive your inheritance, please call Ascent Law LLC for your free consultation (801) 676-5506. We can help you with: Estate Planning. Probates. Intestacy. Will Administration. Trust Administration. Trust Preparation. Trust Accounting. Reading of the Will. Drafting Powers of Attorney. And much more. We want to help you.

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506

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Can You File A Hardship On A Garnishment?

If your employer is deducting money from your paycheck due to a wage garnishment (also called a wage attachment) and you can’t afford basic living expenses, you might be able to reduce the amount of the garnishment. Some of the ways to lower or even eliminate the amount of a wage garnishment include:
• filing a claim of exemption
• filing for bankruptcy, or
• vacating the underlying money judgment.

Most creditors can’t garnish your wages without first getting a money judgment against you. The creditor must sue you in court and then either win its case or else get a default judgment (which it gets if you don’t respond to the lawsuit). After the creditor obtains the money judgment, it must get a court order directing your employer to deduct a percentage of your wages. Not all creditors have to get a money judgment before garnishing your wages though. For instance, a streamlined process is available for creditors collecting tax, student loan, and child support debt. Federal wage garnishment law typically allows a creditor to deduct 25% of your after-tax income, depending on the type of debt. State law can limit the garnishment amount further. The creditor can garnish all of your wages above the protected amount.

how can i apply for garnishment hardship? Options to Reduce or Eliminate the Wage Garnishment

If you won’t be able to afford basic living expenses with the wage garnishment, here are some of your options:

File a Claim of Exemption

Your state laws allow you to keep a certain amount of property needed to work and live. In most cases, you’ll use the same laws when protecting property in bankruptcy with bankruptcy exemptions.
• The head of household exemption: Most states offer a head of household or family exemption. For instance, you might be able to claim this exemption if you provide more than 50% of the support for a child or other dependant. This exemption will protect more of your wages unless you agree to a wage garnishment in writing.
• Social Security and disability can’t be garnished: State and federal law prevent Social Security and disability benefits from being garnished (unless the underlying debt falls into a special category). The funds will retain their protected status in a bank account unless you comingle them with other funds. Once mixed with money from other sources, you’ll have a difficult if not impossible time proving that the funds in question are the protected funds.
• Complete the exemption form and file it with the court: You have a limited time to file an exemption. Check your paperwork for the deadline. After you file the form, the court will set a hearing. You should bring proof of your income and all expenses showing that you can’t afford the necessities of life.

File for Bankruptcy

Filing for bankruptcy not only stops most wage garnishments but in many cases, it will wipe out the collection debt along with other qualifying debt. When you file bankruptcy, an automatic stay stops most collection efforts. What will happen to your debt will depend on the bankruptcy chapter you file:
• Chapter 7 bankruptcy: In Chapter 7 bankruptcy, if the debt is one that qualifies to be wiped out, then the garnishment will be terminated forever.
• Chapter 13 bankruptcy: In Chapter 13 bankruptcy, you’ll make payments to your creditors through a monthly repayment plan. Keep in mind that some bankruptcy courts require your employer to withdraw your monthly Chapter 13 payment from your wages. Also, not all debts get erased in bankruptcy. In a Chapter 7 case, a creditor can continue to collect a non-dischargeable debt such as using a wage garnishment after the bankruptcy. In Chapter 13, you’ll pay all of your non-dischargeable debt in your repayment plan.

Vacate (Get Rid of) the Money Judgment

If you believe that the creditor obtained the judgment improperly, you can file a motion to vacate (get rid of) the judgment. In this request, you should list the reasons why you believe the judgment isn’t valid. Your situation will need to fall within the specific grounds allowed for vacating a judgment, and you should file the motion as soon as you find out about the judgment. If you win the motion and the judge vacates the judgment, the lawsuit won’t go away. But you’ll have the opportunity to file a response and challenge the lawsuit in court.

Talk to a Lawyer

Some of the procedures listed above are more difficult than others to do yourself. Many courts have self-help hours staffed by volunteers who can help you file an exemption. Filing a motion or a bankruptcy case will likely be more complicated.

How Wage Garnishment Affects You

Wage garnishment is more than an inconvenience, it may have significant consequences:
• It may lower your credit scores, thus affecting your ability to do things like get a car financed. Even if you can get a credit card or financing, you pay a higher interest rate
• Garnishment may lower your disposable income, which may affect your ability to pay your household bills.
• If you have more than one garnishment, your employer can terminate you.
There are several types of wage garnishments. The process varies depending on the garnishment source. You can face wage garnishment for some of the following reasons:
• You are behind on child support or alimony payments.
• You have debt from bankruptcy.
• You defaulted on your student loan payments.
• You owe credit card debt, medical bills, or any other consumer debt.
• You owe the government money.
Garnishment Laws
While garnishment laws vary from state-to-state, it is legal across all states to garnish wages for unpaid taxes and child support. Some states do not allow wage garnishment beyond taxes and child support. Check with your state to see if garnishing your check is lawful.
• Most laws require your creditor to give you notice (with a few exceptions, i.e., owing back taxes).
• An employer cannot terminate you when they receive an order to garnish your wage. Unfortunately, you lose that protection if you have more than one garnishment. Your employer may consider you a risk and can terminate your employment.

• There is usually a maximum amount a creditor can request in a wage garnishment. They must leave enough for you to pay certain deductions, like your taxes and unemployment insurance; however, the law does not protect things like health insurance premiums from garnishment. It is better to negotiate with your creditor before wage garnishment. You can solicit a credit counseling agency to help you. Unfortunately, once you have a court order, you lose your leverage (even if you are working with a credit counseling agency) because the court sets the payment arrangement, and it may not work in your benefit.
The Wage Garnishment Process
Remember, wage garnishment is your creditor’s last resort to collect on your debt. It usually happens if you have ignored your creditor’s attempt to receive payment on an outstanding balance. The creditor seeks a court order, and, if approved, the creditor sends the order to your employer. The only times a court order is not necessary is if you owe child support, back taxes, or student loans.

Wage Garnishment: Child Support and Alimony

As of 1988, all new or adjusted child support orders come with a wage withholding order. Alimony only comes with an automatic wage withholding order if it is included with the child support as a family support payment. Otherwise, alimony does not qualify for automatic withholding. When the court grants a child support order, either the person seeking the support or the court provides a copy of the order to the employer. The employer then withholds the amount and takes note of the impacted payment. The wage garnishment can include deductions for medical insurance if the court mandates the parent to provide health insurance as part of child support. Usually, a creditor cannot garnish any more than 25% of your disposable income (or no more than 30 times the minimum wage whichever is the lower of the two). This does not hold true for child support.
• If you are married or have a child outside of the child support order, then only up to 50% of your disposable income is subjected to wage garnishment.
• If you do not have a spouse or a child outside of the child support order, you can lose up to 60% of your disposable income.
• Lastly, if you are over 12 weeks in arrears, an addition 5% can be taken out.
All-in-all, you can lose up to 65% of your disposable income; however, your employer cannot fire you or take disciplinary action because you owe back child support.
Wage Garnishment Process: Back Taxes
IRS garnishment can be more severe. The IRS has greater latitude when it comes to garnishing money from your paycheck, and it does not need a court order. The IRS does not have a maximum amount it can garnish. Instead, the wage garnish is based on the number of dependents you have and your standard deductions. The IRS notifies your employer, who, in turn, is mandated to give you a copy along with an exemption claim form to complete and return. While state and local tax agencies can garnish your wages, they do not have the same reach as the IRS. Since each state law varies, you must contact your state’s labor department to find out the wage garnishment laws.
Wage Garnishment Process: Consumer Debt
Consumer debt, such as credit cards, is also subject to wage garnishment. Consumer creditors, however, must get a court order to garnish your wages. When you first fall behind on your credit card payments, your creditor will attempt to collect. Once you default, the company determines whether they believe you will pay the debt. If they do not foresee you paying your debt, they may decide to sell your debt to a credit collection agency. The credit collection agency will attempt to collect payment. If they are unsuccessful, they may seek a judgment to garnish your wages. It is better to try to negotiate with your creditor before they file a lawsuit. There are some circumstances where you can stop child support payments. If your financial situation has changed or if you are having financial hardship, it’s best to seek legal advice. Child support issues are handled in a different court process. If your wage garnishment causes financial hardship, you have 30 days to object. During this time, you can:
• Request hardship assistance
• Ask the student loan agency to modify a payment plan
• Formally object in writing and request a hearing
The Timing of a Garnishment Order
The lender that issued your student loan has the right to ask the court to garnish your wages if you fail to pay or stop paying on your student loans. In most cases, a wage garnishment can be ordered if it has been at least 270 days since you last made a payment to the lender. If the garnishment request is granted by the court, you could be subject to having at least 15 to 25 percent of your paycheck seized until your student loan account is paid in full. In some instances, the garnishment can last for years depending on how much you borrowed from the lender. With this money taken out of your paycheck, the amount of money you take home to support you and your household with is significantly lowered. The garnishment could leave you struggling to pay basic expenses like rent or your mortgage. However, if a garnishment would create a financial hardship for you and your family, you have the right to request a hearing to present your evidence and explain your circumstances to the lender. You can ask that the garnishment be stopped until your finances improve or you can take other actions to pay off your account in full. Before the garnishment of your paycheck can be halted, you must prove that you are experiencing some type of financial hardship. The types of hardship cases that meet the criteria for stopping or delaying a student loan garnishment include:
• losing or being fired from your job
• having your hours at work reduced significantly
• taking a drastic cut in pay at work
• filing for Chapter 7 or 12 bankruptcy
• suffering a qualifying injury or illness
• failing to pay basic expenses like rent, groceries, and utilities
You cannot simply say that you are experiencing one of these circumstances and expect the lender to take you at your word. You must be ready to present evidence of any of these scenarios when you request a hearing with the loan servicer or a representative from the federal Department of Education. You have the right to request a prompt hearing at which to present the evidence of your financial hardship to your loan servicer or lender. To make this request, you need to write and submit a letter asking for the hearing and explaining what you can do to bring your account current at some point in the future. When writing the financial hardship letter, you should also include documentation proving your case. This documentation can include paycheck stubs showing a reduction in hours worked or income earned. You also can submit court documents like your bankruptcy filing, upcoming bankruptcy hearing date, disconnection letters from utility companies, and other paperwork showing that you cannot pay your bills. Along with this paperwork, you should also include details about how you will pay off your student loans in the near future whether it be through a payment arrangement with the lender or by applying for and taking a second job. Explanation of your good faith efforts to bring your account current could convince the lender to stop the garnishment of your paycheck and give you another chance to pay what you owe. A wage garnishment can take a significant portion of your paycheck that you cannot afford to lose. Even so, the company that issued your student loans can ask for the garnishment if you have failed to pay on your account. You can stop the garnishment order and utilize other means to handle your loans by providing evidence of your current financial hardship.

Garnishment Lawyer

When you need legal help with a Garnishment in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506

Ascent Law LLC

4.9 stars – based on 67 reviews

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Is It Illegal To Withdraw Money From A Deceased Person’s Account?

It is illegal to withdraw money from an open account of someone who has died unless you are actually named on the account before you have informed the bank of the death and been granted an order of probate from a court of competent jurisdiction. Typically, when someone dies banks and building societies freeze their accounts until the person dealing with their estate has applied for an official document known as a Grant of Probate. An executor is named in the Will and is the person entitled to apply for probate. If the deceased died leaving no will then the law state that is entitled to apply for probate, known as an administrator. The executor or administrator also called personal representatives takes responsibility for dealing with the estate.

What is the Punishment for Taking Money From a Deceased Account?

The punishment for illegally withdrawing money from a deceased person’s account can vary significantly depending on the specifics of the crime and jurisdiction in question. In general, this action is regarded as theft, and the penalties can include fines, restitution, and potential imprisonment. The severity of these penalties is typically proportional to the amount of money that was taken. If the deceased account was a part of the estate going through probate, this action can complicate the process and potentially delay the rightful distribution of assets to the heirs. Moreover, taking money from a deceased’s account without proper authorization can lead to a charge of fraud, especially if the act was intended to avoid inheritance taxes or debts owed by the deceased. Fraud penalties also often include fines and imprisonment, as well as potential civil lawsuits from other affected parties. In summary, it is crucial to abide by the legal processes associated with deceased individuals’ accounts to avoid such penalties.

This might come as a relief to bereaved families who believe this makes a loved one’s estate easier to deal with, however, this certainly raises numerous issues, a few of which are detailed below:

• The person who presents themselves at the bank with the death certificate may be the personal representative but it is possible they are not the person entitled to benefit from the estate.

• There have been many instances where the person who provides the death certificate to the bank is not the personal representative, nor are they entitled to receive a share in the estate. The personal representatives then have to rely on this individual to pay this sum to the estate so that it can be correctly distributed. This could result in matters becoming contentious if relations between the parties involved are not harmonious.

• When the personal representative files the inheritance tax account they might believe that because the bank has already released the funds without probate that they do not have to be included. The personal representatives are therefore not delivering a true account and potentially not paying the correct inheritance tax.

Contact banks, utility companies and insurers

Now you have the official will, death certificate and grant of probate (or letters of administration if there was no will), you can inform any banks, building societies, utility companies and insurers of the death.

Current and savings accounts

Bank accounts remain open until all the money is retrieved and the account formally closed. However, direct debits and standing orders will be cancelled. Remember, it is illegal to withdraw money from an open account of someone who has died unless you are the other person named on a joint account before you have informed the bank of the death and been granted probate. This is the case even if you need to access some of the money to pay for the funeral.

As the executor, it is down to you withdraw any money and distribute it to the beneficiaries according to the will. A solicitor will be able to help you with the process. If someone died without leaving a will, rules of intestacy apply. There is, of course, the real possibility you do not know the details of all the deceased’s bank accounts or that some details have been lost. In that case, there are online tools that can help you discover lost accounts.

Debts

Debts such as mortgages, loans or credit cards are not passed on to the inheritors, but must be paid off before the remainder of the estate is distributed as per the instructions laid out in the will. If you are unsure of what or how much money is owed, you’ll need to place a notice in the official public record of deceased estates. If you fail to do this and a creditor later comes forward with a claim against the estate, you might personally be liable for the unidentified debt. Two months and one day after the notice is published and provided no other creditors have come forward, you can distribute the remaining estate amongst the beneficiaries. Any debts taken out in a joint name become the sole responsibility of the survivor when one of you dies.

If you own an account in your own name, and don’t designate a payable-on-death beneficiary then the account will probably have to go through probate before the money can be transferred to the people who inherit it. If, however, the total value of your probate assets is small enough to qualify as a small estate under your state’s law, then the people who inherit from you will have simpler, less expensive options. Depending on your state’s law, they may be able to use a simplified probate procedure or simply prepare an affidavit (sworn statement) stating that they are entitled to the money, and present that to the bank. Not all states offer both options
After death, the beneficiary can claim the money by going to the bank with a death certificate and identification. Your beneficiary designation form will be on file at the bank, so the bank will know that it has legal authority to hand over the funds.

Jointly Owned Accounts

If you own an account jointly with someone else, then after one of you dies, in most cases the surviving co-owner will automatically become the account’s sole owner. The account will not need to go through probate before it can be transferred to the survivor.

Accounts With the Right of Survivorship

Most bank accounts that are held in the names of two people carry with them what’s called the right of survivorship. This means that after one co-owner dies, the surviving owner automatically becomes the sole owner of all the funds. Sometimes it’s very clear that the account has the right of survivorship. If your account registration document at the bank simply lists your names, and doesn’t mention joint tenancy or the right of survivorship, it might be a joint tenancy account, but it might not. If you’re in doubt, check with the bank and make sure the right of survivorship is spelled out if that’s what you want. If you and your spouse open a joint bank account together, it’s very unlikely that anyone would argue that the two of you didn’t intend for the survivor to own the funds in the account. But if you have a solely owned account and add someone else as a co-owner, it may not be so clear what you want to happen to the funds in the account after your death.

Some people add another person’s name to an account just for convenience for example, perhaps you want your grown daughter to be able to write check on the account, to help you out when you’re busy, traveling, or not feeling well. or you might want to give a family member easy access to the funds in an account after your death, with the understanding that the money will be used for your funeral expenses or some other purpose you’ve identified.
Legally, however, the person whose name you add to the account will become the outright owner of the funds after your death. Unless there’s something in writing, there’s no way to know or enforce the terms of any understanding the two of you reached about how the money would be used. The new owner is free to spend the money without any restrictions. If other relatives think you had something else in mind, they may be resentful or angry if the surviving owner uses the money for personal purposes instead of paying expenses or sharing the money with other family members.
If you want someone to have access to your funds only so they can use them on your behalf, there are better ways to do it. Consider giving a trusted person power of attorney (this gives them authority during your life), or leave a small bank account and instructions for its use after your death. Don’t make someone a co-owner on an existing account unless you want them to inherit the money without any strings attached.

Bank Accounts Held in Trust

If you’ve set up a living trust to avoid probate proceedings after your death, you can hold a bank account in the name of the trust. After your death, when the person you chose to be your successor trustee takes over, the funds will be transferred to the beneficiary you named in your trust document. No probate will be necessary. To transfer the account to your trust, tell the bank what you want to do. It may have some forms for you to fill out. Then the bank should adjust its records, and your account statements will show that the account is held in trust.

The owners of many bank accounts, especially savings accounts and certificates of deposit (CDs) name payable-on-death (POD) beneficiaries for the accounts. That means that when the account owner (or the last surviving owner, in the case of a joint account) dies, the payable-on-death (POD) beneficiary can simply claim the money from the bank. The deceased person’s will doesn’t come into play, and there’s no need for any probate court involvement, either.

The Executor’s Role

When money is left to a payable-on-death beneficiary, it doesn’t pass under the terms of the deceased person’s will. That means the money is not part of the deceased person’s probate estate, and it isn’t under the control of the executor. So if you’re the executor (or administrator appointed by the court), it’s not really your job to help transfer the funds to the payable-on-death {POD) beneficiary who inherits them.

You may also be the one to notify payable-on-death (POD) beneficiaries that they have in fact entitled to some money. Otherwise, unless the deceased person told them, beneficiaries may not know. You’ll be able to see that there’s a payable-on-death beneficiary when you look at the deceased person’s bank statements; just look for the term payable-on-death in the account name.

How to Claim the Funds

To collect funds in a payable-on-death( POD)bank account, all the beneficiary needs to do is go to the bank and present ID and a certified copy of the death certificate (if the bank doesn’t already have one on file). The bank will have the paperwork, signed by the deceased owner, which authorized the beneficiary to inherit the funds. The beneficiary can withdraw the money or open a new account.

With a time deposit, such as a certificate of deposit (CD), the beneficiary has a few options:

• Leave the funds in the certificate of deposit until its maturation date. This would make sense if the beneficiary doesn’t need the money right now and the interest rate being earned by the money is higher than what’s available in other investments.

• Withdraw the funds. There is usually a penalty for withdrawing money from a certificate of deposit before its maturation date, but when the certificate of deposit is inherited, the new owner generally does not have to pay an early-withdrawal fee.

• Re-title the certificate of deposit in the beneficiary’s name. If the beneficiary wants to transfer the funds into his or her own name, the bank will probably need to rewrite the certificate of deposit at whatever interest rate is currently being offered. So if rates have gone up since the original certificate of deposit was bought, this could make sense.

Potential Complications

Payable-on-death designations are widely used because they’re simple both for the person who sets them up and the beneficiaries who inherit. Sometimes, however, circumstances can make for complications. If there’s a disagreement over who inherits the funds in an account, consult a local attorney who’s knowledgeable about state probate law.

Divorce

If someone names his or her spouse as a payable-on-death beneficiary, and then the couple divorces, the payable-on-death designation may or may not be automatically canceled. Just like the effect on the will, it depends on state law. Any former spouse who wants to claim a payable-on-death account should check the law to make sure the designation is still in effect.

Multiple Beneficiaries

It doesn’t have to be a problem when more than one person is named as a payable-on-death beneficiary of a single account commonly, the beneficiaries simply split the money evenly. Problems arise only if the beneficiaries can’t agree on what to do about money tied up in a certificate of deposit, or if they’ve inherited an asset that isn’t easily divided. As always, compromise offers the best solution both for everyone’s pocketbook and for long-term family relations.

Ineligible Beneficiaries

It’s uncommon, but some state laws still restrict who can be named as a Payable-on-death beneficiary. It’s never a problem to name a natural person, but there may be prohibitions against designating a charity or other organization to inherit in this way.

Contradictory Will Provisions

Almost always, the Payable-on-death designation wins it’s a contract with the bank, and can’t be changed by will. There are exceptions, however. Some states allow people to revoke Payable-on-death designations in their wills if the will specifically identifies the account.

Free Initial Consultation with Probate Lawyer

When you need legal help with an estate, probate or trust administration, please call Ascent Law for your free consultation (801) 676-5506. We want to help you.

Ascent Law LLC
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506