The process of estate planning and dealing with an estate is something most people have had to deal with or will deal with at some point in their lives. If you are wondering what you should do regarding what happens when you pass on, you are not alone. If you have had a loved one or friend pass away and you are in charge of their final wishes, you will undoubtedly have questions about the Illinois probate process and how to settle an estate. If you are interested in how to shorten or simplify the probate process in Illinois, this article has information for you. Finally, if you want ideas on how to avoid probate altogether, you should certainly continue reading.
What is the Illinois Probate Process?
Generally, the following is the process of an estate moving through the Illinois probate court. The actual meaning of probate is simply proving the validity of a will. Depending on the will, the court may verify it, or will challenges will be litigated. A will challenge is when someone who was or might have been in the will challenges that the will filed with the probate court is invalid because of things like lack of capacity, undue influence, or duress. If there is no challenge to the will the process moves forward as follows:
File the Will with the Probate Court: The executor or personal representative will file the will with the probate court, creating a case. The will typically name the executor and the beneficiaries. The probate court will set a hearing date. Notice of the hearing date will be sent to the beneficiaries in case they want to challenge the will. A hearing date is set to appoint a special administrator if there is no will.
Provide Notice to all the Creditors: There will be debts that the estate may have to pay. Depending on if there is a will, the special administrator or the executor must provide the creditors with notice that the estate is in probate, which starts the clock ticking for any creditor to file a claim against the estate. The deadline to file a claim against the estate is given in the notice. If the creditors do not file a claim by the deadline, they will not be able to collect any debt.
An Inventory Must be Taken: The special administrator or executor must inventory everything the estate contains. This can be a very time-consuming process, especially if there is no will. Not only must the estate be inventoried, but the property it contains must also be appraised. The inventory will be things like real property, financial assets, vehicles, and any business interests the deceased might have had.
Expenses Must be Paid: Prior to moving forward with a distribution to any named beneficiary, expenses must be paid out of the estate. The Illinois probate court is particular as to what expenses must be paid from the estate prior to any distribution. Any expenses for burial or funeral, anything owed to the federal government or the State of Illinois, surviving spouse or child expenses, money owed to employees of the deceased if they were a business owner, and any “miscellaneous claims” that have been entered in the probate action.
Distribute Remaining Assets to Beneficiaries: Once everything has been inventoried, appraised, and all expenses have been paid, the beneficiaries will receive whatever their share is of what is left over. Depending on the size of the estate, any creditor claims against the estate, and what the expenses of the estate are, it could be a much smaller number than a beneficiary is expecting. Furthermore, since the distribution of assets to beneficiaries comes at the end of the probate process, it can be frustrating to have to sit and wait for the distribution.
When all of the above steps have been completed and all distributions made, the estate is considered settled. Naturally, many people want to know how to settle an estate or speed up the settling process quickly. There are plenty of estate planning techniques to either shorten probate or cut probate out almost entirely.
Illinois Estate Planning
If you want to shorten or avoid probate altogether, you should meet with an experienced Illinois estate planning attorney in order to discuss your goals for your estate and how to reach them best. Typically, an estate planning attorney is also considered a probate attorney, so they should be able to advise you on your estate plan properly. Your estate planning attorney will have an arsenal of tools to use in order for you to avoid probate or vastly shorten the amount of time it will take for an estate to move through probate.
The Living, Revocable Trust: This is one of the most popular ways to avoid having most, if not all, of your property, pass directly to your intended beneficiaries. When you create and fund a trust, you can designate yourself as the trustee and beneficiary while you are alive. Then you can include terms and instructions in the trust document so that, upon your death, there are new trustees and beneficiaries. The assets will go exactly where you want them to go when you pass. Since there is no will and no “loose” property lying around, there is no need for probate. Note that sometimes an estate planner will include something called a “pour-over will” in case there is property owned by you that somehow did not make it into the trust. A pour-over will does have to go through probate, but with proper planning and maintenance, you can avoid having anything outside of the trust. Understand that a trust is more work than a simple will. A will can be drafted and signed, and then you can leave it alone. A trust takes supervision and updating, but it is still the best means to avoid probate. For more in depth information on Revocable Living Trusts read our article, Illinois Revocable Living Trusts Explained.
Transfer on death accounts: These are also great tools to transfer assets while avoiding probate. Transfer on death accounts, also referred to as Payable on Death accounts, will have you name a beneficiary when you create them at your financial institution. Upon receiving proof of your passing and verifying your identity, any funds in this account will automatically transfer to your named beneficiary, again, totally avoiding probate.
Illinois Small Estate Affidavit: If the size of your estate, is small enough, the State of Illinois will allow you to use something called a small estate affidavit to transfer property without involving the probate court. If the gross value of your estate is $100,000 or less, you can use the small estate affidavit. The value of the estate, any expenses, and debt must be listed in the affidavit, so it is more work than simply using a trust, but it is a valuable tool to avoid probate. For more information on Illinois Small Estate Affidavits read our article, Illinois Small Estate Affidavits Explained.
Illinois Simplified Probate: This method is also used in Illinois if the gross value of the decedent’s estate is $100,000 or less. The executor named in the will files a request with the probate court to use Illinois’ simplified probate process. If the request by the executor is granted by the probate court, the executor may be able to move right to distributing assets instead of waiting for the entire full-length probate process to be completed. In this case, shorter does not necessarily mean “easier”. All the named beneficiaries and heirs must consent to the simplified probate in writing. Notice still has to go out via the publication process and be posted every week for three weeks. In other words, you still have to do some work.
There are some things to keep in mind if you have a will and are concerned about slowing down the probate process. First, if you decide not to use any of the alternates to a will you will need to consider the validity of your will. Make your will early, keep it updated and make sure a trusted individual has a valid copy of your most current will. Next, if you have a large number of beneficiaries, that will slow down the probate process. If you have assets in several states, that will also slow down the probate process. If your estate has “unusual assets” or has to file tax returns, that will also greatly slow down getting the estate settled. It is essential that you meet with an experienced Illinois estate planning attorney to go over your assets and plan for what will happen after your death if you want to shorten or eliminate the probate process.
It’s never fun to think about when you’re gone, but having an estate plan in place can be a great comfort because you will know that your loved ones are taken care of properly. Appropriate planning beforehand is the best place to start. If you are in need of an estate plan or want assistance in shortening the probate process, give O’Flaherty Law a call today, we would be happy to help you.
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