When you lose a beloved family member or friend, the last things you want to think about are the technicalities related to their will and your inheritance. It can be challenging to consider probate costs when you want to mourn your loved one.
Asking practical questions and working out these issues are critical parts of moving on, though. How much does it cost to probate a will? You’ll need to determine the answer so that you know what financial responsibilities you carry as the inheritor.
What Is Probate?
Before we delve into the costs of probate, let’s outline what it is. When someone dies, their money and possessions enter probate, allowing the property to be passed on to the next owner. Usually, the legal team does this by consulting a will. If no will is available, then the laws that rule the hierarchy of heirs kick in.
Probate aims to provide an orderly way to distribute a deceased person’s property according to their wishes. It does take longer than distributing money within a living trust, as it involves legal transfers of deeds to a new person. The different steps of the process may encompass:
- Inventorying property.
- Using the deceased’s assets to pay off creditors and remaining taxes.
- Appraising property.
Certain things can go to the inheritor without entering probate, such as retirement accounts, jointly owned property and annuities.
How Much Does Probate Cost?
It can take anywhere from nine months to two years for an estate to wind its way through probate. During this time, the estate will accrue fees in probate that cover the cost of passing on the estate, including:
- Surety bonds
- Appraisal fees
- Executor’s fees
- Court costs
You may also have to pay legal and accounting fees for the attorneys and accountants assisting with your case. When the will is contested, these fees will rise.
Generally, probate costs range from 3% to 7% of the estate, but there is no hard and fast rule that applies to every case. You could pay more if you have a drawn-out probate case, or you may pay less if the estate has fewer assets to cover.
Probate Fees by State
Probate fees vary according to state. Many states limit fees paid to executors or attorneys, and these policies force less-complicated estates to follow a less-expensive approach. More than a dozen states have embraced the Uniform Probate Code, which regulates probate fees.
States that allow statutory fees usually have higher probate taxes than Uniform Probate Code (UPC) states, basing the payments on the percentage of the estate’s total value. Some of those states include Wyoming, Florida and California. If you’re unsure which policy applies to the estate you’re inheriting, experts like the team at Inheritance Funding can help.
Learn More About Probate Fees With IFC
Do you still have questions about probate costs and what to expect if you inherit? IFC can get you the answers. Contact us today to learn more.