The Elder Law Forum

The Elder Law Forum
Overcoming "Probate-Phobia"

People harbor an irrational fear of probate. They see it as a "legal boogeyman" – a process that exposes estates to public scrutiny, taxes, and – scariest of all – attorney fees.

"What do you think?" asked a senior legal helpline caller: "Do I have to file the will with the court and open a probate proceeding? I don't want to do anything illegal, but it seems unnecessary in this case."

Her father died last week following a lengthy illness and incapacity. She had handled his financial and business affairs for the past seven years pursuant to a durable power of attorney. He left a will designating her as the personal representative, to serve without compensation or bond. The will sets out the division of assets between the caller and her siblings.

"He has no real property," she advised. "But he has several bank accounts with significant balances. I am a joint owner on most of the accounts, but there are four accounts that I have managed through my power of attorney, but am not an owner. I know I can go to the bank and close out those accounts. If I do so, will I be breaking the law?"

The answer is yes. Her power of attorney terminated upon her father's death. When the principal dies, so does the power of attorney. "Your authority to close out those four accounts now resides in your capacity as the personal representative for your father's estate," I advised. "In order to act on behalf of the estate you will need a court to issue 'letters testamentary' authorizing you to act on behalf of your father's estate."

Similarly she will need the letters to prepare and execute state and federal income tax returns. There may be inheritance tax considerations as well.

The "probate estate" in this case will consist solely of the four accounts. She will be able to use a "short form" probate procedure requiring only that she prepare and sign an affidavit describing the status of the estate and her authority to act on its behalf. She should use an attorney in preparing the affidavit, completing a financial statement, and closing the estate. Its cost will be modest. Most law firms have fixed fees for short form probates.

The caller confronted an ethical dilemma. Should she not tell the bank her father died, quickly and conveniently close the accounts, and avoid probate altogether? Or, should she comply with the "letter of the law," hire an attorney, and file a short form probate affidavit?

She said she would call a local attorney. She overcame her "probate-phobia."

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