State of Ohio Estate Administration Process
State of Ohio Estate Administration Explained
Estate administration is the process by which a person’s assets are collected, maintained, and distributed among creditors, heirs and beneficiaries according to the person’s will and the laws of Ohio.
When an individual dies, some of the person’s assets may be transferred by trust, joint and survivorship property, payable on death accounts, transfer on death property, and beneficiaries named under life insurance and retirement benefits. These are non-probate assets. Other assets must be transferred through proceedings in probate court and these are called probate assets. Most people die owning both probate and non-probate assets.
Estates
What Is Estate Administration?
A probate estate is a legal proceeding provided for by Ohio law to determine the assets of a deceased person who was an Ohio resident at the time of death, the value of those assets, and the distribution of those assets to the persons entitled to them by law.
A probate estate is necessary to protect and conserve the assets of the decedent for the heirs, creditors, and other persons interested in the estate. The probate estate will provide for the payment of outstanding debts, the payment of taxes, and the distribution of the remaining assets to the persons entitled to receive them under the decedent’s will or by law. This process is known as the administration of a decedent’s estate.
What Are The Duties Of The Fiduciary?
An estate is opened by any interested person filing an application to administer the estate. The application is filed in the county in which the decedent resided. The Court appoints an estate representative, called a fiduciary, and issues Letters of Authority. The fiduciary is appointed according to the decedent’s will or statutory guidelines. If appointed by will, the fiduciary is an executor. If there is no will, the fiduciary is an administrator. It is the responsibility of the fiduciary to administer the decedent’s estate and to account to the Court for that administration. A fiduciary who fails to perform their statutory duties is subject to removal by the Court. A bond may be required of the fiduciary to protect the beneficiaries and creditors of the estate and to ensure proper administration.
What Are The Steps Of An Estate Administration?
Pursuant to the statutes and local Court rules, the basic steps of administration are as follows:
- Application for authority to administer the estate and to admit the will to probate if one exists
- Appointment of fiduciary
- Gathering of assets and obtaining appraisals as required
- Filing the inventory in a timely manner
- Payment of estate debts
- Filing of estate and income tax returns and payment of taxes, if any
- Distribution of remaining assets to beneficiary(s)
- Closing the estate by filing a final account or certificate of termination in a timely manner.
Does A Fiduciary Need An Attorney?
Due to the complexity of the law and the legal problems that are involved in estate administration, the Court strongly recommends that all fiduciaries seek legal counsel. Good legal advice and guidance can expedite the probate process, prevent costly errors, and protect against the fiduciary being sued.
More Useful Information
Guardianship
This information is provided to the public in order to provide a general understanding of the duties and procedures of the Probate Court in reference to guardianships. This information should not be considered as a legal reference. If you have any legal questions dealing with guardianships, an attorney should be consulted.
What is a Guardianship?
A guardianship is an involuntary trust relationship in which one party, called a guardian, acts for an individual called the ward. The law regards the ward as incapable of managing his or her own person and/or affairs.
What is a Guardian?
A guardian is any adult person, association, or corporation appointed by the Probate Court to assume responsibility for the care and management of the person, the estate, or both, of an incompetent person or minor child. A corporation can only be guardian of the estate and not of the person.
Who needs a Guardian?
A guardian may be appointed for either an incompetent or minor, which are defined by statute as:
Incompetent: Any person who is mentally impaired as a result of a mental or physical illness or disability, or mental retardation, or as a result of chronic substance abuse, that he is incapable of taking proper care of himself or his property or fails to provide for his family or other persons for whom he is charged by law to provide, or any person confined to a penal institution within this state.
Minor: Any person under 18 years of age who has neither father nor mother or whose parents are unsuitable to have custody and tuition of such minor, or whose interests, in the opinion of the Court, will be promoted.
Minor Settlement: Natural parents do not have an inherent right to settle personal injury claims on behalf of a minor child. The Probate Court must authorize approval of such settlements. If the settlement exceeds $25,000, the Court will require the appointment of a guardian of an estate.
Who Chooses the Guardian?
The Court appoints the guardian. However, a minor over 14, or the parents by will, may suggest a guardian for a minor. In addition, an adult, while competent, may nominate a guardian to serve in the event of incapacity.
Appointment Procedure
Application for guardianship is filed in the Probate Court of the County of the ward’s residence by an interested party, or on the Court’s own motion.
Application must include a statement of the guardian’s willingness to perform as guardian, a bond as required by law, and, in the case of a prospective incompetent ward, a statement of the ward’s mental and physical condition from a treating physician, psychiatrist, or licensed psychologist.
The prospective ward, as well as the adult next of kin, are notified of the impending guardianship and date and time of hearing as prescribed by law. In the case of an incompetent proceeding, the notice and a statement of rights will be served on the prospective ward by a Court Investigator.
An investigation is conducted, in the case of a prospective incompetent ward, by a Court Investigator which includes an interview with the prospective ward in order to assist the Court in determining the advisability of guardianship.
Formal hearing is conducted by the Judge or Magistrate to determine if a guardian is necessary and whether the guardian is suitable to serve.
Minor Guardianship
Please note: Birth Certificates must be provided. The applicant must be fingerprinted in the Guardianship Department at the Court at the time that the Application for Guardianship of Person Only is filed. If the application is mailed in, the applicant must be fingerprinted within a week of the filing. A valid state ID or driver’s license is required.
Right of the Ward
The prospective ward has the right to be present at the hearing to contest any application for guardianship, to have a record of the hearing taken, to have a friend or family member present at the hearing, and to be represented by an attorney. A prospective incompetent ward has the additional right to present evidence of a less restrictive alternative, and, if indigent and requested, to have an attorney and independent expert appointed at Court expense.
Court Supervision
The Probate Court is the superior guardian, and all guardians must obey all orders of the Court. The Court exerts its supervisory authority through the following:
Accountings: A guardian of the estate must file a written account with the Court biennially (annually in V.A. cases) as to the income and expenses of the ward’s estate.
Reports: A guardian of an incompetent ward must file a written report annually or biennially. The report identifies the status of, and need for the guardianship.
Citations: If a guardian fails to timely file a report, inventory, or accounting, the Court may cite a guardian to appear, and may fine, reduce the guardian’s fee, or remove, the guardian.
Investigations: To determine if a guardianship is functioning properly, the Court may order an investigation by a Court Investigator, Law Enforcement Agency, Adult Protective Service, or other County Agency.
Prior Approval: The guardian must first obtain approval of the Probate Court before entering into contracts or leases, making improvements to real estate or mortgaging real estate, selling assets, settling any personal injury claim for the ward or spending the ward’s funds.
Removal: The Court may, at any time, in the best interest of the ward, remove the guardian.
Types of Guardianships
Person and/or Estate: A guardian may be appointed either a guardian of the person, a guardian of the estate, or both. A guardian of the person has custody of, controls, and protects, the person of the ward. A guardian of the estate controls and protects the assets or property of the ward.
Limited: A guardian may be appointed with limited powers to make restricted or specific decisions of the ward. The ward retains all powers not granted to the guardian.
Emergency: In an emergency in which significant injury to a prospective ward may occur unless immediate action is taken, the Court may appoint an emergency guardian for 72 hours.
Fees
A guardian’s compensation and attorney’s fees are set by Court rule, and must be approved prior to fees being paid.
Termination
A Court order will terminate a guardianship upon the death of a ward, upon the ward being adjudged competent, or, in the case of a minor, upon reaching the age of majority (18). A Motion for termination of a guardianship of an incompetent may be filed 120 days after an appointment of a guardian, and once every year thereafter.
Guardianship Training Handbook
This handbook is meant to provide some basic information to you as you begin a guardianship with the Cuyahoga County Probate Court. This information is given to the public in order to offer a general understanding of the duties and procedures of the Probate Court in reference to guardianships. This information should not be considered as a legal reference. If you have any legal questions when dealing with guardianships, an attorney should be consulted.
How does the probate process begin?
After the death of an individual, the probate process begins by any interested person filing an application to administer the estate and an application to probate the Will in the county in which the decedent lived. The court will appoint an estate representative, called a fiduciary. The fiduciary is responsible for administering the decedent’s estate and accounting to the court for that administration. If there is no Will, a bond will be required of the fiduciary to protect the beneficiaries and creditors of the estate and to insure proper administration of the estate’s probate assets .
How are fiduciary fees determined?
Ohio law sets forth fees for a fiduciary of an estate as follows:
4% of the first $100,000 of personal property, income, and proceeds of real estate sold;
3% of the next $300,000;
2% of the balance;
1% of the value of real estate not sold; and
For dates of death after 2012, 1% of all property that is not subject to probate administration except joint and survivorship property.
The fiduciary may waive the fee. Additional fees can be awarded for extraordinary services.
How long should it take to administer an estate?
The time it takes to administer an estate depends on each estate’s circumstances. Some estates are administered in nine months to a year. Other more complicated estates will take a longer time to complete.
What are the steps of an estate administration?
The basic steps of administration are as follows:
- filing of an application for authority to administer the estate and admit the will to probate, if one exists;
- appointment of fiduciary;
- gathering assets and obtaining appraisals as required;
- filing an inventory of assets;
- paying creditors;
- filing estate and income tax returns and paying taxes, if any;
- distributing remaining assets to beneficiaries;
- filing accounts; and
- closing the estate.
May items be removed from a safe deposit box?
Generally, an interested person may remove items from a safe deposit box and provide an inventory of its items to the court if necessary. However, not all financial institutions allow this and the court will appoint a person to retrieve the items in a safe deposit box.
What if there is no will?
If the decedent had no will, the decedent’s probate property is distributed to the decedent’s nearest surviving kin in the manner as set forth under the Ohio laws of descent and distribution.
What if the will is unclear?
If the Will is unclear, an action to construe the Will may be filed in the probate court. A hearing is held to determine the intent of the testator.
May I object to the Will?
Any interested party may contest the validity of a Will. A Will Contest must be filed within three months after the filing of a certificate that all interested persons were given or waived notice of the admission of the Will to probate.
Must a will be presented to the court?
A Will should be presented to the Probate Court as soon as practical after the death of an individual, even if there are no known probate assets. A person who withholds a Will intentionally, negligently, or without reasonable cause may lose the right to inherit.
What property must be appraised?
Property must be appraised if the value is not readily ascertainable. Examples include real estate and closely held business interests.
