How to Avoid Probate in Idaho

If you have ever heard of Probate, or heard someone talking about Probate, it is usually in a negative light and in terms of avoiding it (or wishing they had avoided it).

Recently, I have shared some information on what Probate is, when Probate is required, the typical cost of going through Probate, and the most surprising bit of news I ever get to share, when a surviving spouse is required to go through Probate.

But, how do you (or I) avoid Probate? I will offer three potential different paths to avoiding Probate to chew on.

First, don’t own enough assets that would “require” Probate. Typically, if you have less than $100,000 of Probate-able assets and you do not owe any real estate, you can, and might want to avoid going through Probate. Although initially, this does not sound ideal, a large portion of our population fall into this category.

Second, you can try to piecemeal a plan together to avoid Probate. Update the Beneficiary Designations for ALL of your financial accounts, update all of your title-able personal property into an ownership status called community property with rights of survivorship, and update the ownership of all real estate into the ownership status of community property with rights of survivorship. This step typically only helps avoid Probate for the first spouse to pass away in a married couple. Also, this step has severe inheritance consequences that are too complex to cover in a simple blog post. Please know that I recommend against updating your ownership of these assets without first consulting an estate planning attorney to discuss the consequences of your potential decision.

Third, is a Living Trust or sometimes called a Family Trust. A Trust is a universal solution that covers all types of property upon the death of both spouses. In my opinion, this is the best option available to avoid Probate.  A Trust that is properly established and maintained (not difficult, but certain actions will need to happen in the future), it will avoid probate entirely, including the delay and the expense, upon the death of both spouses.

That’s why so many people understand that a Living Trust or Family Trust is the best option for avoiding the time and delay of probate.

Is Probate Required for a Surviving Spouse?

The unthinkable just happened. Your husband or wife just passed away, either expectedly or unexpectedly. Your spouse had everything updated and had a Will. So are you, the surviving spouse, required to go through Probate?

There are few scenarios that frustrated clients more than when they learn that the client has a 6-month long probate legal proceeding ahead of them, which is required to move the deceased spouse’s property and possessions into the name of the surviving spouse. Especially, when they believe that they had everything “taken care” of.

Most Idahoans believe that the living spouse is automatically entitled to all of the deceased spouse’s property and that the Probate process will NOT be required.

Unfortunately, that is not the case.  Unless the spouse who passed away took special steps to avoid the probate requirement, it will be necessary even if the surviving spouse is legally entitled to inherit everything. However, creating a Will is not a special step to avoid Probate.

A special step that is used most often, and is the most effective, to avoid probate is to set up a Revocable Living Trust or Revocable Family Trust.

Justin Jeppesen: When is Probate Required, When is it Not?

After the dust begins to settle when a person passes away, the dreaded thought that now you must go through Probate for their estate seeps into your thoughts. Often times you are correct to think this, but multiple times a week I talk with people that aren’t required to Probate a deceased person’s estate. So, when is Probate required?

In the state of Idaho, Probate will be required to administer a deceased person’s estate if he or she meets one of the following two factors, or both: 1) $100,000.00 or more of personal assets; and/or 2) any interest in real property (ie personal residence, condo, undeveloped land, oil interests, etc.).

If you have a house, even if there is a mortgage on it, you will go through Probate. If you have a large collection of jewelry, tools, or guns chances are you will go through Probate. If you have a life insurance policy, retirement account, CD, investment account, or checking and savings account that does not have a beneficiary designation on it, you are probably going through Probate.

Is Probate required for you? That depends on whether or not you meet one of the two Probate triggering factors. The real property factor is easier to understand than the $100,000.00 personal asset factor. Either you own a home, or land, or don’t.

If you don’t meet either factor, Probate is not required for you. Yay! Having stated when Probate is required, please understand that a skilled, competent, and experienced estate planning attorney can explain to you the ways to avoid Probate, even if you meet the requirements under the law.

Ultimately, if a person owns property worth more than $100,000.00, or if he or she owns any real estate, the most effective means of avoiding Probate is through the use of a Living Trust.  A Trust, properly prepared and funded with the assistance of a lawyer, it is the best way to avoid probate.

Justin Jeppesen: Cost of Idaho Probate

If you find yourself having to Probate the estate or Will of a loved one, among the chief-est of concerns is the Cost? Let alone all of the other unknowns involved with Probate, the cost is often the one question most people in my office want to know.

While I can’t guarantee you a cost, I can provide general guidelines. If everything went well, with no surprises, you can expect to spend somewhere in the neighborhood of $2K - $5K throughout the entire Probate process on Attorney’s fees. Again, only if everything goes off without a hitch.

Jeppesen Law charges a flat rate of $2,000 to proceed with an informal probate. Often, this is the only charge for Attorney’s Fees that the clients incur. However, my Representation Agreement has built in per hour price contingencies if an unexpected Creditor Claim or Will Contest arises, but that seldom occurs.

What does that $2,000 include? An informal probate proceeding (no court, yay!), Office Consultation regarding probate of decedent’s estate, Prepare of Application for Informal Probate and Informal Appointment, Preparation of Statement of Informal Probate and Appointment, Preparation of Letters Testamentary, Prepare of letters to the Probate Magistrate Judge in the Venue county, Preparation of the Notice to Creditors to be Published with the local Newspaper, Filing the Application and other pleadings with the County Probate Court, Real Estate Transfer Documents, Publication Fees, and County Probate Court Filing Fees. Whew, that was a mouth full.

As a reminder, it is always a good idea to ask your attorney early on in the process of estimated costs. After ask a number of specific questions that can lead to pitfalls, the attorney should be able to provide an estimated cost. Better yet, hopefully he/she can offer you a fixed fee plan. This approach encourages efficiency and economy that ultimately works to the benefit of the clients.

However, to avoid both the cost and the time delay of probate, a Living Trust or Family Trust is often the best option available.

Justin Jeppesen: Idaho Probate Explained

In a very basic description, probate is the court process to oversees that the correct people inherit  property when someone passes away.

With or without a Will, Probate is initiated with a petition.  And, by law, the Probate process must last at least 6 months.

Once the probate court determines whether or not there is a Last Will & Testament, then the court appoints the appropriate person to serve as the Personal Representative of the Probate Estate.  Usually that person is named in the Will, however, that person can be appointed if they have priority for that role under Idaho law if there is no Will.

After the Probate court appoints the Personal Representative, he or she will collect the deceased person’s assets and property, pay legitimate creditor claims, sell any property that cannot be divided, and distribute the remaining property and funds to the named heirs or appropriate devisees.

During that remaining 6 months the Personal Representative will prepare and file a list of the decedent’s property and will provide an “accounting” to the court describing the property and financial details of the probate process.

At the end of the 6 month period, if the Personal Representative is finished with his or her work, ie creditors have been dealt with, remaining property distributed, etc., a final statement is filed with the court closing down Probate.