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Estate Tax
Probate & Non-Probate Assets
Wills
Durable Power of Attorney
Medicaid
Income Tax: Step-Up In Basis
Gift Taxes
Titling Your Assets
Living Trusts
Avoiding Probate Court
Living Will & Healthcare
Power of Attorney
Organizer of Information, Document Locations, and Funeral Arrangements
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Know that if an asset has a beneficiary designation or is held as Joint Tenants with Rights of Survivorship, it already avoids probate court procedures. Be certain to fill out an asset sheet including how each asset is titled with beneficiaries and contingent beneficiaries listed. This will help you see clearly if each asset avoids probate or not.
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To learn more about
Planning Your Estate
Contact Us to Schedule a Visit
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Often lost in the hype of “Avoiding Probate” is a clear understanding about what probate is and about how and when to avoid it. Learn more about Probate & Non-Probate Assets.
It is common for a couple to have no probate assets, since many couples hold their property jointly with rights of survivorship and have each other as the primary beneficiary on all other assets. Since two automobiles can be transferred to a surviving spouse in Ohio without involving Probate Court, it is common for the first spouse to die with only non-probate assets and hence no probate estate.
There are five main reasons to avoid Probate Court:
- Attorney Fees
Attorneys customarily charge either based on a percentage of assets or on a project/hourly basis. If consents are received by all parties affected by the fee, the most a lawyer can charge in Hamilton County (Ohio) without a hearing before the judge is:
- • 5.5% of the first $50,000 of probate assets
- • 4.5% of the next $50,000
- • 3.5% of the next $300,000
- • 2% of the assets above $400,000
- • 2% on real estate that is not sold
- • 1% on non-probate assets includible on the estate tax return
Although some attorneys charge based on this percentage of assets basis, many attorneys charge for estates based on the amount of time and expertise required to complete the work. Either way the attorney charges, certainly reducing this fee makes sense. Attorneys are hired by the executor, who should find out how the attorney charges for estate administration before engaging the attorney’s services.
Attorney fees are payable at the end of the estate process when the final account is prepared for filing with Probate Court unless otherwise approved by the court.
- Executor Fees
Executors can be compensated for the responsibility taken and the time and expertise necessary to complete the estate process. Executor fees are set by Ohio statute and are similar to attorney fees, except the percentages are somewhat lower:
- • 4% of the first $100,000 of probate assets
- • 3% of the next $300,000
- • 2% of the assets over $400,000
- • 1% on real estate that is not sold and on non-probate assets included on the estate tax return (except for survivorship assets, for which there is no fee)
Some executors consider their services to be a gift to their families and choose to forego the fee. Other estates are more complicated, or past services have been rendered, which factor into the executor’s decision to take the fee. It is entirely the executor’s decision.
Executor fees are payable at the end of the estate process when the final account is prepared for filing with Probate Court unless otherwise approved by the court.
- Time For Administration
"Everything is tied up in Probate Court," is a commonly held but inaccurate belief. Real estate, investments, and bank accounts can be liquidated soon after the executor or administrator is appointed. Initial distributions to beneficiaries can generally be made quickly, provided there are adequate assets to pay all debts and claims against the estate. The estate cannot be closed immediately because creditors in Ohio have six months from the date of death to file a claim against the estate. Estate taxes are due nine months from the date of death. Most estates are completed within a year, so “delays” are not a reason to avoid probate.
- Probate Court Costs
The Probate Court in Hamilton County costs $225, no matter how large the estate. Even if a resident died in Hamilton County with a $50 billion probate estate, Probate Court costs would be only $225. So, although there are some costs, court costs are not the reason to avoid Probate Court.
- Privacy
Probate Court documents are a matter of public record. Someone could look up names of beneficiaries, the estate inventory, etc. if they know where to look. A client desiring more privacy may choose to hold assets in a trust or with a named beneficiary in order to avoid Probate Court.
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