The Basics of Estate Administration

estate administration basics

As difficult as it is to think about, everyone has to deal with the administration of an estate at some point. Whether you’re thinking about the future administration of your own estate or that of a loved one, understanding estate administration basics is essential.

Estate administration means settling financial and legal affairs after someone passes away. Each state has its own laws and procedures for estate administration, and Minnesota estate administration attorneys can help you navigate the process in the Gopher State. Contact Safe Harbor Estate Law in Saint Paul for more help.

What Is Estate Administration?

Estate administration is the overarching legal process that ensues after someone dies. It’s a process that involves identifying, managing, and distributing the deceased person’s assets.

The process can be lengthy and complicated, and it usually warrants the help of an attorney, especially for more complex estates.

What Is a Personal Representative?

The personal representative, also known as the executor, is responsible for administering the estate in Minnesota. If the decedent had a will, the personal representative is named in the will. If there is no will, the court will appoint a personal representative.

Personal Representative Duties in Minnesota

The personal representative in Minnesota has several duties, including:

  • Collecting and inventorying assets
  • Paying debts and taxes
  • Notifying heirs and beneficiaries
  • Distributing assets to heirs and beneficiaries
  • Filing tax returns

Types of Estates in Minnesota

In Minnesota, there are two types of estate administration: supervised and unsupervised. A supervised estate is one where the court oversees the administration of the estate, while an unsupervised estate is one where the court does not oversee the administration.

Whether an estate is supervised or unsupervised depends on the case’s circumstances. In some cases, the decedent’s will may dictate which type of administration is required, while in other cases, the court may make the determination based on the size and complexity of the estate.

It’s important to note that regardless of whether an estate is supervised or unsupervised, the personal representative still has many important responsibilities. Hiring an experienced attorney can be helpful in navigating the estate administration process and ensuring that all legal requirements are met.

Probate Estates in Minnesota

Probate is the court-supervised process of administering an estate in Minnesota if there is more than $75,000 worth of assets passing through a will, or if there is real estate owned by the decedent.

It involves several steps, including:

  • Filing a petition with the court
  • Notifying heirs and beneficiaries
  • Collecting and valuing assets
  • Paying debts and taxes
  • Distributing assets to heirs and beneficiaries

In a supervised estate, the court is involved in every aspect of the estate administration process. The personal representative must seek court approval for every action they take, such as selling assets or distributing property.

This level of court involvement can add time and expense to the estate administration process and provide more protection for the estate’s beneficiaries.

Non-probate Estates in Minnesota

Not all assets are subject to probate in Minnesota. Many people employ asset protection strategies in their estate plans to avoid a court-supervised estate administration.

Non-probate assets include:

  • Assets held in joint tenancy
  • Assets with designated beneficiaries, such as life insurance policies and retirement accounts, which pass outside of a will
  • Assets held in a living trust

In an unsupervised estate, the personal representative can administer the estate without court oversight. However, they are still required to follow all applicable laws and regulations. The unsupervised process can be faster and less expensive than the supervised process, but it may also be less protective of beneficiaries’ interests. Whether supervised or unsupervised, it is important to work with an attorney to make sure you follow state regulations, and relieve yourself of personal liability.

Timeline for Estate Administration in Minnesota

The timeframe for estate administration in Minnesota can vary depending on several factors, including the size and complexity of the estate, whether the estate is supervised or unsupervised, and whether there are any legal challenges or disputes.

Generally, the estate administration process can take around eight months to one year to complete. More complex estates can take years. The process typically begins with filing a petition with the court to open probate, which can take several weeks to process, depending on which county is handling the probate.

Once probate is open, the personal representative must identify, gather, and value all of the estate’s assets. This can take several months, especially if the estate is large or includes complex assets.

After the assets have been identified and valued, the personal representative must pay any debts and taxes the estate owes, which can take several months, depending on the amount owed and the complexity of the tax issues involved.

Once all debts and taxes are paid, the personal representative can distribute the remaining assets to the heirs and beneficiaries of the estate. This distribution process can take several months, especially with disputes or legal challenges.

It’s important to note that the personal representative has a duty to administer the estate promptly and efficiently, and delays can result in legal liability. Hiring an experienced attorney can be helpful in ensuring that the estate administration process is handled as efficiently as possible and that all legal requirements are met within a reasonable timeframe.

Hiring an Attorney for Estate Administration in Minnesota

Hiring an attorney for estate administration in Minnesota is highly recommended, as the process can be complex and involve many legal issues.

An estate administration attorney can help with:

  • Filing death certificate and last will and testament in court
  • Court appearances
  • Admission of last will and testament to probate
  • Determination of applicable proceeding(s), including Administration, Formal Administration, and Homestead Determination
  • Drafting and filing documents with the court to carry out applicable proceedings
  • Appointment of Personal Representative
  • Property inventory documentation
  • Paying debts and taxes
  • Objections to standard creditor claims
  • Advice & Negotiation regarding Medicaid estate recovery claims
  • Preparation and filing of income, estate and trust tax returns, and related advice
  • Final distribution of estate property to beneficiaries
  • Discharge of the personal representative

The total amounts spent on legal fees for Estate Administration work vary greatly. It is difficult to give a precise estimate without taking the time to examine the whole situation. The size of the estate, whether there are medical assistance claims, real estate to deal with, and whether the estate is solvent are all significant factors. The greater the complexity and assets involved, the greater likelihood the court will want to oversee things more closely, and require more work on the legal professional’s end.

How Do You Avoid Probate in Minnesota?

Probate can be a time-consuming and expensive process in Minnesota, and some people may prefer to avoid it if possible.

Here are some ways to avoid probate in Minnesota:

  • Living trust — A living trust is a legal document that allows you to transfer ownership of your assets to the trust during your lifetime. When you pass away, the trust still lives, and the assets in the trust are distributed to the beneficiaries you named in the trust without the need for probate.
  • Joint ownership — Joint ownership is another way to avoid probate in Minnesota. When you own property jointly with another person, such as a spouse or family member, the property typically passes to the surviving owner when you pass away. However, each financial institution handles this differently.
  • Beneficiary designations — Certain assets—like life insurance policies and retirement accounts—allow you to name beneficiaries. When you pass away, these assets are distributed directly to the named beneficiaries, typically without the need for probate.

It’s important to note that while these methods can help you avoid probate, they may not be appropriate for everyone. Each situation is unique, and it’s important to consult experienced estate planning attorneys to determine the best course of action for your circumstances.

Need to Learn More About Estate Administration Basics?

If you are going to serve as the administrator of a loved one’s estate, it is important to do it right. Consider this: There are more than 100 steps that must be taken from the beginning to end of handling somebody’s estate.

Additionally, most of these steps follow a legal process that must be taken in a specific order and within certain time frames. When you work with us, we are by your side through every step, offering legal advice and making sure it is done correctly and efficiently. This process becomes even more complicated when a person passes away without an estate plan, or if family members are fighting.

We know each step of the process and have systems in place to keep your case moving in an expeditious manner. We assist you with every step of the probate process, making sure it is handled correctly and protecting you from personal liability.

Contact us today at Safe Harbor Estate Law, and we’ll walk you through the process.

Author Bio

Margaret Barrett is the Founder and Owner of Safe Harbor Estate Law, a Saint Paul, MN, estate planning law firm she founded in 2013. With almost 15 years of combined experience in litigation and Minnesota estate law, she is dedicated to representing clients in a wide range of estate law matters. Her practice areas include estate planning, asset protection, elder law, and more.

Margaret received her Juris Doctor from the William Mitchell College of Law and is a member of the Minnesota State Bar Association and the Ramsey County Bar Association.

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