Losing a loved one is among the most difficult things families can face. Managing their estate and transferring assets are necessary tasks that are challenging as they require an understanding of Pennsylvania estate law and close attention to details. Oftentimes, the person serving as the executor or personal representative has never had any experience with estate administration, making the process seem even more daunting. To help understand how the process works in Pennsylvania, here are the highlights.
Probate and Administration
In Pennsylvania, whether the decedent left a will or not, to initiate a probate proceeding a Petition for Probate must be filed in the Orphan’s Court/Register of Wills for the county in which the decedent resided at the time of death. Filing the petition in the wrong court will result in it being dismissed. If the court approves the petition, the court will admit the will to probate and issue the executor a document called “letters testamentary.” Letters give the executor authority to act on behalf of the estate and proceed with the steps necessary to settle the decedent’s estate.
Note that if the decedent did not have the will, the process for initiating the administration process is essentially the same. Of course, there is no will to submit. The person appointed by the court to manage the estate during probate is referred to as an administrator and that person will receive “letters of administration”.
Once the executor or administrator has received letters, they are responsible for the following steps:
- Identifying estate assets. The executor must identify, secure, and appraise estate assets. and determine their value.
- Paying debt, taxes, and expenses. Paying what the decedent and their estate owes is a priority of the probate process. The executor must use estate assets to pay valid claims against the estate, to pay expenses related to the administration of the estate, and to pay any taxes owed.
- Distributing assets. The executor is also responsible for distributing estate assets according to the terms of the will.
The requirements related to probate also apply in cases where the decedent did not leave a will. When someone dies without leaving a valid will, there are special laws that apply to determine who gets the decedent’s property. These laws are referred to as intestate succession laws. PA ST 20 Pa.C.S.A. § 2101
Under Pennsylvania law, the surviving spouse and children are a decedent’s heirs if there is no will. In the absence of a surviving spouse or children, the law provides which blood relatives are entitled to inherit in a stated order of priority. PA ST 20 Pa.C.S.A. § 2104. The situation can become murky where the decedent has no close relatives and someone comes forward to claim the estate. Under these circumstances the court may require the claimant to prove relatedness through a kinship hearing.
Settlement of Small Estates
If an estate has few assets, under Pennsylvania law, formal probate may not be required. Under Pennsylvania’s settlement of small estates rules, PA ST 20 Pa.C.S.A. § 3102, estates with assets that have a value of less than $50,000.00 can file a petition with the Orphans’ Court for approval to distribute assets. The petition must include:
- An inventory of estate property and the value of each asset
- A list of all debts
- Amount of taxes owed
- Names of beneficiaries or heirs
- Proposed plan of asset distribution
If the court finds that the estate meets the requirements for small estate settlement, it will issue an order that authorizes the petitioner to pay estate debts, expenses, and taxes and to then distribute the remaining estate according to the proposed plan included in the petition.
Even though the administrator will still have to go through the same general steps as required by formal probate, the process is a lot quicker than formal probate and less expensive.
Probate is not always without complications. Probate disputes sometimes develop that can lead to probate litigation and significant delays in the process. Disputes frequently center on allegations that the will is fraudulent, an ambiguity in the terms of the will, allegations of breach of fiduciary duty, challenges to the estate accounting, fiduciary removal proceedings, and proceedings to establish inheritance rights.
Probate disputes almost always cause a delay in the probate proceeding as the court cannot move forward with the routine tasks of administration until contested issues are resolved. Probate disputes can also be costly to the estate.