When a person dies, the property he or she owned must be passed on (distributed) to his or her heirs. The legal process for passing on "ownership" of property is called Probate.
The term "probate" refers to a "proving" of the existence of a Will, and determining "proving" who the legal heirs are if no Will exists. The process of probate determines who will receive the property and, or assets of the deceased.
A probate estate with a valid Will is known as a "Testate Estate".
A probate estate without a valid Will that is governed by State law is known as an "Intestate Estate".
The probate process involves identifying and inventorying the deceased person's property, accounting and appraising the value of the property, and then paying taxes and creditors from the assets of the probate estate.
Distribution of the deceased person's property and assets to the heirs is determined in one of two ways, either:
- By reading the Will, or if no Will exists;
- Then under the state or provincial law in which the probate estate is located.
In other words, probate is the legal process which dictates the legal steps and timeline for the accounting, liquidation and disbursement of the property in a deceased person's estate (probate estate).
The probate process is generally overseen by an executor. The person designated as the executor of the estate is named as such in the Will. The executor is the person who administers (is in charge of) the probate estate. Even if named in the Will it is generally up to the court to approve the executor. If there is no Will, a personal representative or "Administrator" is appointed by the probate court to oversee the process. In some states or provinces the executor is also called the "personal representative", even if a Will exists. Once appointed, many jurisdictions require the executor to post a surety bond to protect the property and assets of the estate and the heirs from misconduct by the personal representative.
One common misconception of the probate process is that with the existence of a valid Will, the probate and estate can be avoided. Although the existence of a Will tends to speed up the process, probate is generally still required for any property or assets owned in the deceased's name.
Though, most property individually owned by a decedent has to pass through probate for ownership to pass to his or her heirs, any jointly owned property and the proceeds of retirement accounts, annuities and life insurance policies are normally passed on outside of probate to the surviving joint owner or to named beneficiaries (heirs or those persons named in the Will).