Losing someone leaves you sifting through pain alongside paperwork that won’t file itself. If you’re unfamiliar with settling estates, like most grieving families, you’re probably wondering — do we legally have to probate these assets?
Each state has varying rules about probate administration. As of 2024, in Alabama, if an estate is valued at $36,030 or more or it includes real estate, the estate will go through the normal probate administration process. Estates that do not include real estate and are valued at less than $36,030 are eligible for a slightly less complex probate process called summary distribution.
What is the Probate Estate Value Threshold in Alabama?
Under the Alabama Small Estates Act, if the gross value of a deceased person’s probate estate assets exceeds $36,030 at the time of their death, probate is required. This process involves filings with the probate court and thorough estate administration duties before assets can eventually pass to beneficiaries.
However, our state also offers a streamlined “summary distribution” for smaller estates. This simplified process does not require the appointment of a personal representative and moves faster through the court system.
Setting up a summary distribution is still complicated, but it only takes 30 days vs. six months for the creditor time period.
Can Small Estates Avoid Probate in Alabama?
In Alabama, even small estates typically need to go through some form of probate. However, the state does offer a simplified probate process called summary distribution. This streamlined procedure is generally faster and slightly less expensive than the formal probate process, making it an option for many families dealing with the loss of a loved one.
While summary distribution is still a type of probate, it is designed to minimize the burden on the deceased’s family and expedite the distribution of assets. In some cases, though, it may be possible to avoid probate entirely by ensuring that the deceased’s assets are held in a trust or other non-probate vehicle. By working with an experienced estate planning attorney, you can explore options and develop a comprehensive plan that protects your assets and simplifies the process for your loved ones.
What Counts Towards Probate’s Asset Value Threshold?
To see if an estate can use summary distribution, we need to look at what assets are part of the probate estate.
Typically, the following assets left behind would be valued towards probate:
- Personal property like jewelry, vehicles, furniture, art, etc.
- Financial accounts in the deceased’s sole individual name, like savings/checking accounts or non-retirement investment accounts
- Real estate owned solely by the deceased or as tenants in common
However, non-probate assets are NOT included in the valuation of the probate estate. For example:
- Assets with designated beneficiaries like 401ks, IRAs, or life insurance policies with named beneficiaries
- Jointly-held bank accounts or properties with rights of survivorship
- Assets placed in living trusts
The distinction lies in whether the assets pass through probate or transfer directly to new ownership outside of probate when someone dies. Non-probate assets transfer automatically and are not considered part of the probate estate value.
Our attorneys can help families take inventory following state guidelines on what assets legally require court-involved estate administration and which assets pass outside of probate.
How An Alabama Probate Attorney Can Help
Probate attorneys can provide invaluable support when dealing with the aftermath of losing a loved one. We have extensive experience in guiding and simplifying an inherently stressful process.
In particular, our lawyers can assist by overseeing and completing necessary court filings on the family’s behalf. Rather than trying to tackle confusing legal and financial issues on your own, it’s better to bring in an attorney who has the experience to manage the administrative hassles for you.
Contact The Law Offices of Brenton C. McWilliams Today
If you’ve recently lost a loved one in Alabama or been tasked with handling their estate as executor, you may be confused about the probate process.
We caution families from relying on online advice when dealing with something as important as the administration and distribution of an estate. Instead, contact us for guidance tailored to your situation.