After a loved one passes, it can be difficult to settle their final affairs, especially if they did not have an estate plan in place. Without a Will or Trust, the state’s default estate plan will apply and likely have to be administered through a court probate. While every estate is different, the administration can be broken down into several key steps:
- Open the Estate with the Court – An individual willing to administer the Estate must file a petition with the court of the county where the decedent last lived. The petition asks the court to appoint an Administrator to collect assets, pay bills and handle all matters regarding the Estate. It also informs the court of the decedent’s known assets and family members. The judge will review the petition and formally appoint the Administrator of the Estate. The Administrator must post a surety bond with the court.
- Notify All Parties – Once the Estate is open, the Administrator must notify potential and known creditors, as well as the “heirs” of the Estate, which are certain family members eligible to inherit from the Estate.
- Collect the Assets – The Administrator must gather the decedent’s assets and create an inventory to provide it to the heirs and possibly file with the court.
- Pay Bills – The court requires creditors be provided a 6-month period to file claims. Once that time period has expired, the Administrator can pay remaining debts of the decedent and prepare to distribute assets to the heirs of the Estate.
- File Tax Returns – The Administrator must file a final income tax return for the decedent, and annual income tax returns for the Estate until it is closed. If estate tax is an issue, federal and state estate tax returns must be filed within 9 months of the decedent’s death, unless extended. In 2022, estates with gross assets over $12.06M must file a federal estate tax return, and Illinois residents with over $4M must file an Illinois estate tax return.
- Distribute Property – After the 6-month claim period has expired and all Estate debts, taxes and expenses have been paid, the Administrator can distribute the assets. The Administrator must provide the heirs with a complete accounting and proposed distribution. Once approved, the Administrator can distribute the Estate assets.
- Close the Estate with the Court – Once the assets have been distributed, and all final debts, taxes and expenses have been paid, the Administrator must file a final report with the court that informs the judge that all Estate matters have been completed and asks the judge to close the Estate. If approved, the judge will close the probate and discharge the Administrator.
To learn more or begin the process of administering an estate or trust of a loved one, contact Buckley Fine’s Estate and Trust Administration team at 847- 381-0011 or email us at firstname.lastname@example.org.