What is Involved in Probating an Estate in Michigan

Probate of Decedents Estates

Normally, when someone refers to probate, they are talking about the administration of a deceased persons estate. The probate procedure for an Unsupervised Administration is outlined below. (Supervised probate occurs only in rare circumstances and, due to extensive court involvement, results in significantly higher costs. In most cases, supervised administration is necessary only where the Will of the deceased requires it, if the beneficiaries of the estate request it, or where there is a Will contest.)

When a person dies with property titled in his or her individual name, an interested party files an Application for informal probate admiinistration with the probate court in the county where the decedent resided. The probate court appoints a personal representative (or executor), to take control of the assets and to manage them until all of the property has been distributed according to the Will or Michigan intestacy law. Normally, the court appoints the person named as personal representative in the Will, if there is one. If there is not a Will, the court normally would appoint an heir as personal representative.

Within fourteen days of appointment, the personal representative must provide copies of the Will (if there is one), to all interested parties. Copies of the lawyers representation agreement, along with notices regarding attorney fees and the appointment of the personal representative, are also provided. Within 91 days of appointment, the personal representative must provide the interested parties with an Inventory of all property in the estate. It is no longer necessary for the Inventory to be filed with the court, for an unsupervised administration. Thus, one of the privacy concerns from the past has been removed. The court clerk or probate analyst will examine the Inventory form, however, for the purpose of calculating the Inventory fee; i.e., the countys cut of the probate estate. The Inventory fee is based on a percentage of the estate assets and is relatively modest; (a $25 fee on a $3,000 estate, and a $1,175 fee on an estate worth $1,000,000).

The personal representative must also prepare an Account, detailing the income and disbursements from the estate. As was the case with the Inventory, the Account no longer needs to be filed with the court, (in an unsupervised administration). The interested parties are entitled to a copy of the Account, however, and they can object to disbursements that they believe are unreasonable.

After the Account has been sent to the beneficiaries, the remaining estate property can be distributed and a Closing statement is filed, provided the estate has no tax liabilities. An estate must file income tax returns if it earns more than $600 in any year. Estate tax returns must be filed for any estates in excess of $1,500,000. IRS and Michigan tax clearances must be obtained for estates where tax liabilities exist. Thirty days after filing the Closing Statement, a Certificate of Completion officially closes the estate.

The probate estate must be open a minimum of six months. Administration may take longer if complications arise. If the estate is open for longer than twelve months, an extension must be requested from the probate court, and the attorney must explain to the court why the estate cannot be closed.

The cost of probate administration fluctuates, depending on the size, nature and complexity of the estate, and on the skill and billing practices of the attorney. Many attorneys do probate work on the side, and since there are few definite deadlines to meet, the proceeding can be dragged out. Most attorneys charge an hourly rate for administering the estate. If an attorney charges fees based on any other criteria, he or she should not be retained. The attorney fee is usually the single largest charge against a probate estate.

Aside from attorney fees, there are a number of other costs incurred during probate, including filing fees, the inventory fee and personal representative fees. Most estates will experience total probate costs of 2-5%. Excessive delay and higher attorney fees could cause a substantial increase in costs, however.

It is very important to remember that probate administration is necessary only for property titled solely in the name of the deceased. If property is titled in any other manner (jointly held, in a trust, etc.), probate does not apply.

Please feel free to contact us by telephone or e-mail, if you have any questions regarding probate estates.