When a person dies, it is often necessary to follow formal procedures in settling the estate. The process is called Estate Administration. Both state and federal law establish certain requirements which must be followed. Administration includes procedures and requirements relating to collecting of assets, satisfying of obligations such as debt, expenses and tax preparation, and filing and distribution of property to heirs and beneficiaries.
What should be done first?
If someone close to you has died, make sure that their home is secure and nothing is lost or destroyed. It is illegal in Pennsylvania to enter a safe deposit box without notifying the Pennsylvania Department of Revenue or its authorized representative so that the contents of the box can be inventoried. Shortly after the funeral, an attorney should be contacted by the survivors to discuss the estate. The attorney will provide advice, determine whether administration will be required and explain what procedures will be involved. If there is a will, the person named as executor should protect the will and give it to the Philadelphia estate planning lawyer at the first meeting. When is formal estate administration required?
In almost every case when a person dies having personal property or real estate, an estate must be administered.
Who administers an estate?
An estate is administered by a personal representative. If there is a will, the personal representative named in the will is the executor. If there is not a will, it is the administrator, who is chose by the Register of Wills. The personal representative works with an attorney in complying with necessary legal requirements.
What does a personal representative do?
The personal representative is charged with the actual administration of an estate, and has the responsibility for performing all functions that are required. This includes following the directions of the decedent (the deceased person) if there is a will, or following the requirements of the law if there is not a will. The representative also gathers information about the assets of the estate and the debts, notifies the beneficiaries under the will or the intestate heirs, pays all debts and expenses as well as inheritance taxes, and distributes the assets to the beneficiaries.
Should I have a Philadelphia estate planning lawyer to assist in the administration of the estate?
As a practical matter, it is very difficult for a non lawyer to correctly follow the required procedures in administering an estate without the assistance of an attorney. The personal representative selects the attorney for the estate, often the same attorney who prepared the will. A Philadelphia estate planning lawyer can also be located by calling the Pennsylvania Bar Association’s Lawyer Referral Service toll-free at 1-800-692-7375. Most counties have this same service at the local level. Check your yellow pages under “attorneys” for more details.
What happens during the Administration?
At the beginning, all assets of the estate, including personal possessions and real estate are inventoried and sometimes physically gathered. All of the beneficiaries (if there is a will) or heirs (if there is no will) are located. They are told that they were named in the will or have a legal right to receive an inheritance. Funeral expenses, debts, state and federal taxes are paid, and necessary tax returns are filed.
Sometimes administration may involve the short-term management of a business or corporation or sale of a business or stock in a corporation. There could also be sale of real estate which was owned by the deceased.
At the conclusion of the administration period, a final accounting of all assets is presented for approval to the county court. After approval, distribution of the balance of the assets is accomplished.
What fees are paid during administration?
In addition to court costs, fees (usually based on a percentage of the gross value of the estate) are paid to the attorney and to the personal representative. These fees are paid out of the assets of the estate. Fee arrangements should be discussed during the first visit to the attorney who will be involved in the administration of the estate.
If you and your loved ones need advice or help determining whether administration will be required, contact Anthony Caiazzo today at (215)465-5575.