California Estate Planning Blog by Kevin Staker

June 23, 2017

A Brief Explanation of Probate

Filed under: Kevin Staker,Probate — Kevin Staker @ 8:13 am
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Kevin Staker Probate and Trust Mediation pic

Kevin Staker Probate and Trust Mediation
Image: staker.com

An experienced estate attorney based in Camarillo, California, Kevin Staker has led as president and principal of StakerLaw Tax and Estate Planning since 1985. In 2016, Kevin Staker also became principal of an independent probate and trust mediation company.

Probate is the process by which a court oversees the identification, appraisal, and distribution of a deceased individual’s assets. It often begins when an individual presents the deceased person’s will and files a petition of probate. If no will exists, probate begins with the appointment of an administrator, who is typically a close family member if possible or a public administrator otherwise.

Once the executor has received official appointment, the court admits the will into probate and the executor may begin to administer relevant assets. This process begins with the collection and inventorying of assets, which the executor must officially file with the court.

The executor is also responsible for using assets in probate to pay any due taxes, bills, and other expenses that the deceased has left behind. In some cases, doing so may involve selling non-cash assets. The executor may also need to set aside funds for the support of family members during the remaining phase of probate, in which the executor officially distribute the deceased’s property according to the terms of the will.

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June 13, 2017

IRS Extends Missed Deadlines for Estate Tax Portability by Kevin Staker

To transfer the unused estate tax exemption of a deceased spouse, the transfer must be done in an estate tax return filed for the deceased spouse.  The deadline for such a return is nine months after the death of the deceased spouse.  That deadline cannot be extended by the typical extension for filing an estate tax return.

Many surviving spouses have missed that deadline.  Such a spouse up until June 9th had to apply for an expensive private letter ruling from the IRS to be allowed to file the estate tax return after the nine month deadline had been missed.  That entailed a filing fee of thousands of dollars and attorney’s fees of thousands and thousands of dollars to fill out the amazingly complex paperwork applying for a simple extension.

The IRS has come to its senses and on June 9th in Revenue Procedure 2017-34 (https://www.irs.gov/pub/irsdrop/rp-17-34.pdf) has ruled such a late return may now be filed by the later of January 2, 2018, or two years after the death of the decedent.

I personally had one client I called immediately.  I had recommended he go through the private ruling process because it would have saved tens of thousands of dollars in estate tax if he were to die in the near future.  Lucky for him he did not follow my advice.

See also http://www.journalofaccountancy.com/news/2017/jun/portability-election-extension-201716844.html

By Kevin Staker