Legacy Insights: Navigating the Generation-Skipping Transfer Tax


Top Ten Probate Mistakes

Posted by Rebecca Yingst Price | Nov 18, 2022 | 0 Comments

At Ibis Legacy Law, LLC, we have administered too many probate estates to count.  Just like each family, each probate estate is unique.  Our goal is to make the administration of our estates go as smoothly as possible to save our clients time, stress and unnecessary expenses.  For those that may be going through the probate process, we complied a list of the ten most common mistakes/misconceptions that people have when dealing with a probate estate in Ohio.

1.  Doing it yourself will save the estate money.

Seems simple, right? Not so fast. More often than not, we will get calls from fiduciaries that tried doing the administration on their own and ultimately got frustrated, didn't realize how time-consuming it can be. There are lots of different factors to consider…is there a Will, is there a surviving Spouse, are there minor children, are there adult children, are the children the biological children of both the decedent and the surviving spouse? Overwhelmed yet? You are not alone, many times we are called to assist as the once the estate has been opened because the fiduciary has become overwhelmed. While the Probate Courts have their forms publicly available, what is essential is knowing how to complete the forms accurately, when they are due, and what is required to be provided to the Court in terms of supporting documentation.  Each Probate Court has their own unique policies and procedures that are not always obvious and can be frustrating to figure out!

2.  Thinking all probate estate administrations are the same.

This ties in with #1. Not only does each Probate Court have their own unique policies and procedures, but in Ohio, there are several different types of Probate Estates: Full Probate Administrations, Releases From Administration, Summary Releases From Administration and Ancillary Administrations. It is important to know which probate process fits with your circumstances in order to accomplish the end goal of getting the decedent's valid/debts claims paid, administrative costs paid and assets distributed to the rightful beneficiaries in accordance with the court's requirements as timely and efficiently as possible.

3.  Closing the estate too soon.

First, you may think that enough time has passed since the estate was first opened and you have met the Probate Court's minimum to keep the estate open for 6 months following the date of death.  Then you think that you have dealt with most of the decedent's assets plus the beneficiaries are pressuring you to distribute the assets and close the estate, so you agree to close the estate.  Then 2 months later, perhaps you get a real estate tax bill for a vacant lot or you get a statement for an asset that only issues statements on a bi-annual or annual basis. Then perhaps you find out there are significant unclaimed funds with the State of Ohio due to the Estate.  Finally, perhaps you find out that the decedent is entitled to a tax refund which the IRS won't pay since there is no longer a fiduciary in charge of the Estate.  There are no potentially significant assets that should have been part of the estate. Now you have to file re-open the estate in order to probate this new asset, incurring additional court costs and fees. It is natural that you as the fiduciary and the beneficiary(s) want to wrap up the estate administration as soon as possible, but that ultimately is not in the best interest of all involved if it means having to re-open the estate.  Having an experienced probate attorney help guide you through the process can help you avoid these costly mistakes.

4. Paying (or ignoring) all of debts/expense/obligations of the decedent.

In Ohio, there are ten different types of creditors all of whom have different priorities to be paid under the law. There are insufficient assets to pay all of the creditors (either because there are not enough assets in the Estate or distributions were made too soon), the Fiduciary can be held personally liable to all or some of the creditors who were not properly paid.  To avoid this, you will want to determine if a creditor is secured or unsecured. Was their claim properly and timely filed? Other than expenses relating to the administration of the estate, ie, court costs, attorney fees, fiduciary fees, Fiduciary's Bond premiums, expenses related to real property in the estate, all other debts should likely be put on hold until such time as it can be determined if the estate is solvent or insolvent.

5.  Failing to file tax returns.

Did the decedent file 1040's (personal income tax returns).  Does the Estate need to file a final 1040 on behalf of the decedent?  Is the decedent entitled to a tax refund?  Did the estate generate enough to require to filing of an estate income tax return (1041)? Are the total assets of the decedent over the threshold for the filing of a federal estate tax return (706)?

6.  Thinking that all assets automatically pass to a surviving spouse.

This is not the case in Ohio.  The surviving spouse has certain rights to a portion of property in a probate estate, but is not necessarily entitled to inherit everything.  Additionally, assets may be distributed outside of probate via beneficiary designations.  On those non-probate assets, the surviving spouse is not legally entitled to a portion of those assets.  Even if the spouse is on the asset jointly with rights of survivorship, the asset(s) do not automatically transfer to the spouse without additional steps being taken.

 7.  Thinking that all of the Decedent's assets will be distributed according to the terms of their Will. 

That is true for assets that are in the decedent's name alone AND do not have a beneficiary designation on them.  If however, the Will states that all bank accounts are bequeathed to “Person 1”, but there is a bank account that has a “payable on death” beneficiary designation to “Person 2”, the beneficiary designation overrides the Will for that particular bank account. It can be even more confusing to determine who gets what when the decedent no longer owns particular assets that are identified in the Will.

 8. Believing that the simplicity or complexity of an estate is directly correlated to the size of the estate.

You can have a million-dollar estate that consists of 2 bank accounts and a brokerage account and 2 beneficiaries which can make for a relatively seamless collection and distribution of the assets. On the other hand, you can have an estate valued at $100,000, that consists of a bank account, personal property, including vehicles, real property and multiple beneficiaries, some receiving all cash, others receiving some cash, along with assets distributed in kind.

 9.  Distributing assets of the estate too early in the estate administration.

If the major asset in the estate is real property, you have to be extremely careful to ensure that the estate has enough cash to meet its expenses.  You don't want to pay either specific bequests or distributions to beneficiaries to the point that you don't' have enough cash in the estate to pay for the upkeep of the real property until it is sold/transferred.  If that happens, you could be forced to sell tangible assets (e.g. artwork, jewelry, family heirlooms, etc.) of the estate that you hadn't planned on having to do in order to have sufficient funds to pay these costs.  You could also be forced into a position of having to personally pay the estate's expenses in order to preserve the assets to avoid personal liability for making distributions too soon.

 10.  Not keeping detailed accurate records of assets/liabilities of the estate.

You are required to account to the Probate Court for all assets collected and all disbursements made, it is imperative that a detailed ledger be kept.  If you fail to do this, you may be held personally liable for an unaccounted for expenses.  It is much less time-consuming to keep the records throughout the entire administration than it is to try to go back and retrace your records.

If you have made it this far, you have probably come to the conclusion that there is more to administering a probate estate than may initially meet the eye. We are happy to guide you through the process or we are happy to take the reins and do most of it for you (and everything in between).  If you are named as the Fiduciary of an estate with assets it is unlikely that you will personally have to pay for an attorney to represent you.  Generally, most legal fees associated with a probate estate are paid from the estate assets.  Why risk trying to do it alone?

 Please contact us at Ibis Legacy Law, LLC at 216-991-6200 for assistance with your probate administration.  If you prefer to send an email, you can reach our Probate Paralegal Tracy Stout at [email protected].  We regularly practice in all Probate Courts in Northeast Ohio including Cuyahoga County, Summit County, Portage County, Lake County, Geauga County, Ashtabula County and Lorain County.  If you need help with a probate estate in another county of Ohio, we can help as well!

Disclaimer: This content is for informational purposes only and is not intended to provide, nor should it be relied upon as, legal advice, nor does the receipt of this content create an attorney-client relationship.

About the Author

Rebecca Yingst Price

Attorney Rebecca Yingst Price has devoted her legal career to helping families and individuals with estate planning, estate and trust administration, and residential real estate. She believes that there is no substitute for proper legal planning to protect loved ones. Ms. Price has vast experien...


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