when is probate required


When Is Probate Required in Arizona?

Probate is a process in which the state of Arizona administers your assets after your death. The probate process and distribution of your assets can take over a year, and could lead to conflict in your family. Luckily, not all estates have to go through probate in Arizona. Understanding when probate is and isn’t required can help you create an estate plan that avoids this process.

At Phelps LaClair, we’ve been helping Arizona residents avoid probate for over 40 years. We put together this guide to help you design an estate plan that avoids probate and gives your family peace of mind. 

When Is Probate Required in Arizona?

Probate is required in Arizona if the decedent (deceased person) owned any assets that did not have beneficiary designations at the time of death. If you die without a will, or if your will leaves out some of your assets, your estate will be subject to probate. 

Probate is also required for large estates with assets valued at a total of over $75,000 and/or real estate worth over $100,000. Even if your estate exceeds this threshold, it’s still important to draft a will to ensure that the probate process is short and goes smoothly for your family. 

If an estate does not exceed this threshold, a family member will need to submit an affidavit to the county court in order to go through the more simplified probate process for small estates. The affidavit must list an inventory of the assets in the estate as well as the names and addresses of family members and a copy of the decedent’s will. After the court grants the affidavit, the executor can start administering the estate without the need for court proceedings. 

What Happens When an Estate Goes through Probate?

If you name an executor in your will and your estate is subject to probate upon your death, then the executor must file a petition for probate. If you do not name an executor, the court will name an administrator for your estate. However, a friend or family member can petition the court to name them as the administrator. 

When your estate goes to probate court, your will goes through verification and then your assets will be distributed accordingly. If your estate goes to probate without a will, the court distributes your assets via the laws of intestate succession. Your assets will automatically go to your next of kin, giving you no control over who receives which assets. 

Which Assets Are Subject to Probate?

Individual bank accounts, real estate property, and all personal property (including vehicles, collectibles, etc.) are all subject to probate. When assets pass through probate, the heirs cannot receive them until the probate court transfers the title of ownership. 

However, there are many assets that are not subject to probate. Non-probate assets such as bank accounts, life insurance policies, and retirement accounts that have a beneficiary designation will automatically transfer to the beneficiary and avoid probate. Real estate property that’s held in joint tenancy or as tenants by the entirety—two ways of jointly owning property—is also not subject to probate. Trusts also qualify as non-probate assets. 

What Happens If the Executor Doesn’t File Probate?

If probate is required for your estate and the executor does not file the petition, they will be held personally liable. Before you name an executor, make sure that they fully understand the responsibilities of their role and what can happen if they don’t fulfill their duties. 

Failing to file probate can leave assets vulnerable to theft and lead to investment losses. The assets in the estate will likely be frozen until the estate is liquidated. If you’re an heir to an estate that’s subject to probate and the executor hasn’t filed, you can take action. All you need to do is file a petition to open probate yourself. 

How Can Your Estate Avoid Probate?

There are several ways to ensure your estate will avoid probate. For example, you can reduce the size of your estate by placing assets into a living (revocable) trust or a qualifying type of irrevocable trust. Assets in a living trust still belong to you. As a result, you can continue to access and manage them during your lifetime. 

After your death, the living trust automatically becomes irrevocable. Your successor trustee will then be in charge of distributing the assets in the trust to your beneficiaries. With an irrevocable trust, the trust is the owner of the assets. That means you cannot access them during your lifetime, but they will remain safe from creditors. 

Creating a will that accounts for all of your assets will also make your small estate exempt from probate. Make sure to list contingent beneficiaries for each asset. Sometimes, the primary beneficiary has already passed away or disclaims their inheritance. In that event, the asset will then transfer to the contingent beneficiary, avoiding probate. 

Probate and Estate Administration in Arizona

Whether you want your estate to avoid probate or need help administering an estate that’s subject to probate, the experts at Phelps LaClair can assist you. We’ll help you and your family find peace of mind when it comes to probate court and settling your estate. Call 480-892-2488 today to schedule a consultation in Mesa, Chandler, or one of the surrounding areas.

Images used under creative commons license – commercial use (6/16/2022). Photo by Sasun Bughdaryan on Unsplash

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