Understanding Probate: A Guide for Families and Business Owners

Probate sounds intimidating, but at its core, it’s simply the court-supervised process of:

• Gathering your loved one’s assets

• Paying taxes, debts, and administrative costs

• Distributing what’s left to heirs or beneficiaries

  
  

Determining the Need for Probate

Whether an estate must go through probate depends on four quick questions:

| Key Question | Why It Matters |

| What assets exist? | Different assets trigger different rules. |

| Who owns them & how are they titled? | Sole-owned assets often need probate; jointly owned ones often don’t. |

| Value of those assets? | In South Dakota, for example, probate is generally required if all probate-able assets exceed $100,000 (other states set their own limits). |

| Where are the assets located? | Probate is state-specific. Own property in two states? You might need two probates. |

A Will Doesn’t “Skip” Probate, But It Still Matters

Having a Last Will and Testament doesn’t keep your estate out of court; it simply tells the court:

• Who’s in charge. This person is the Personal Representative (often called an Executor).

• Who gets what. If there’s no Will, state law, not family wisdom, decides both of these questions.

  
  

What the Personal Representative Actually Does

Once appointed, the Personal Representative usually is responsible for:

1. Inventory and secure assets

2. Open an estate bank account

3. File final taxes

4. Notify creditors (via public notice and direct letters) and pay valid claims

5. Distribute assets per the Will—or per state law if no Will exists

6. Handle real-estate transfers or sales

7. Keep heirs and the court informed throughout the process and close the estate once everything is complete

   
   

Probate Isn’t All Bad, But Many Families Prefer to Avoid It

Court oversight can reassure some families. Recent e-filing rules have made probate less cumbersome. Still, avoiding probate often saves time, money, and privacy. Here are the most common non-probate tools:

| Tool | How It Works | Pros | Watch-Outs |

Joint Ownership with Rights of Survivorship | The surviving owner automatically inherits. | Simple for spouses. | Adding adult children can create tax & liability surprises.

Pay-on-Death (POD) / Transfer-on-Death (TOD) Beneficiaries | You name direct beneficiaries on accounts or even real estate. Fast, no court filing. Must keep designations current; complex family plans can get messy.

Revocable Living Trust Your trust owns the assets; a successor trustee handles them when you’re gone. Centralized, private, usually quicker & cheaper than probate. Requires upfront funding; assets must be retitled into the trust.

The Bottom Line

Probate is simply the court’s way of wrapping up an estate. With smart planning, we can decide how much (or how little) of that process your family ever sees. At Plan Wise Legal, we:

• Review life changes that might trigger a probate need (new home, business, marriage, inheritance, etc.)

• Help you choose the right mix of Wills, beneficiary designations, joint ownership, and trust planning

• Guide Personal Representatives through probate when it is required

  
  

If you’re curious whether your current plan will sail past probate or land squarely in it, let’s talk. If you’ve just lost a loved one and aren’t sure what comes next, we’re here to help with probate, trust, or small-estate administration every step of the way. Give us a call at 605-291-1448 or email at info@planwiselegal.com.