Wills: Probate and Public Record

Throughout a lifetime, a person can save large amounts of money and collect valuable assets. To ensure their assets and valuables are kept in the family, many people create wills, which are legal documents that dictate how they want their assets and funds distributed among the family and friends they leave behind when they pass on.

For the intentions of a will to be executed, it must go through a process called probate, where it is validated, the estate is inventoried, and assets are distributed according to the decedent’s wishes. The will then becomes public record.

The Relationship Between Wills and Probate

Because wills are legal documents that contain distribution plans for sometimes very valuable assets, they are required by state laws to go through a process called probate to prove that they are valid and that the decedent had the right to leave the assets to their beneficiaries.

Probate creates an organized and systematic distribution of assets—in a society without laws governing how assets and property are passed on, it would be complete chaos as family members and friends descend on an estate and begin fighting over everything of value.

State laws may vary regarding probate, but in general, the process follows these steps and is supervised by the Clerk of the Superior Court or an equivalent probate court:

• The executor files the will with the probate court.
• The executor gathers all assets subject to probate and inventories and accounts for them.
• The executor notifies financial institutions, life insurance policy issuers, the Social Security Administration, the IRS, the employer, creditors, and beneficiaries.
• The executor uses the assets to settle debts and taxes the decedent owes.
• Leftover assets are distributed to beneficiaries by the executor according to the will.
• The estate is closed by petition to the court from the executor after all creditors and beneficiaries are paid.

Estates Not Subject to Probate

There are exceptions to the requirement for probate if the deceased’s assets are below a set dollar amount. The dollar amount varies greatly from state to state, from less than $3,000 in Alabama to less than $150,000 in California. In most states, if the assets are under those limits (sometimes called a small estate), the family must file for a Voluntary Administrator proceeding which determines how the assets are distributed.

Wills and Public Record

Wills need to be accessible after the probate process is finished because someone or a creditor missed during probate may have a claim on the estate. For this reason, probated wills become public records, which means anyone can show up at the courthouse and view them in their entirety.

Once probate has been officially closed by the court, the will becomes a public record. Generally, anyone can go to the courthouse where it is filed, pay the required fee, and receive a copy of the will.

Avoiding Probate and Public Record

Probate is often thought to be a long and painful process where the court system determines who gets what and how much. The American Bar Association disagrees, stating that probate is rarely as bad as is commonly thought.

But if you feel you must avoid probate and don’t want your assets and intentions made available to the public, you can create a trust that will bypass probate.

Living Trusts

A living trust is an instrument you can create to place specific assets in. You can name your beneficiaries and distribute your assets as you see fit without probate. Your designated trustee handles the trust’s affairs and ensures all assets are distributed following your intentions.

Asset Protection Trusts

An asset protection trust allows you to place assets you don’t want to go to creditors. These trusts are generally irrevocable, meaning you can no longer access them once your assets are in them. They are also expensive to set up, so the assets placed in one should more than offset the cost of creating it.

Other Trusts

You can use many other types of trusts to keep specific assets out of the probate process and the public record. However, most people do not need to consider using trusts to bypass probate because they do not have estates large enough or assets that require privacy to warrant these expensive instruments.