Typically, estate planning attorneys use trusts and other instruments to help their clients avoid probate court. Clients often ask, why it is important to avoid probate court? The two best reasons for avoiding probate court are (1) time and (2) cost.
Probating a deceased person’s estate is a long process. For a normal probate estate beneficiaries can expect to wait six months to a year before the process is completed and the assets are distributed. The reason the process is sluggish is because probate requires several steps and a large amount of court involvement. Several of the steps require mandatory time-waiting periods giving creditors and other parties time to become involved in the proceedings. For example, before assets can be distributed to beneficiaries, a notice to creditors must be filed. All creditors are given a 90-day time period in which they can file creditor claims against the estate. Extra steps are also required if real property must be sold or interested parties object at any time during the probate proceedings. The end result is that from start to finish probate takes a significant amount of time.
The second reason to avoid probate is its cost. Because probate requires court involvement, attorneys, executors and other parties are almost always involved. The usual attorney fees are set out in the Nevada Revised Statutes Chapter 150. Generally, attorney fees are calculated based on the size of the estate at 4% of the first $100,000, 3% of the next $100,000 2% of the next $800,000 and 1% for the next $9,000,000. Thus an estate worth $1,000,000 would have attorney fees of approximately $23,000. Executors and administrators are also entitled to a similar, but slightly smaller fee. Beneficiaries will also be required to pay court filing and other fees. Overall probate ends up being an expensive process.
As probate is both time-consuming and expensive, many people successfully avoid probate all together. This can be done by setting up a proper estate plan. If you have any questions about avoiding probate and setting up your estate plan, feel free to contact one of our attorneys.
Attorney – Corey J. Schmutz