1. WHAT IS AN ESTATE PLAN?

An Estate Plan is the legal process of preparing documents to determine how your assets will be distributed after your death.  Although North Carolina has a statute that provides for how your assets will be distributed, it may not be what you want.  An Estate Plan is not for the wealthy.  Everyone has property that he/she wants to distribute to certain individuals after his/her death.

2. WHAT IS A WILL?

A will is a legal document that transfers some of the assets held in your individual name to your  beneficiaries when you pass away.

3. WHAT IS INTESTATE SUCCESSION?

Intestate Succession is the name of the laws in North Carolina that determine who will inherit property  when the person who dies does not have will. Intestate refers to the fact that a person has passed away without a will.  In this case, a person named to probate the estate is referred to as an Administrator, instead of Executor.

4. WHAT IS AN EXECUTOR AND WHAT DOES AN EXECUTOR DO?

The executor is the person named by you in your will who you want to carry out the terms of the will. If you do not have a Will, then the person is called an Administrator.

The Executor’s/Administrator’s duties include:

  • Petitions the court to open probate and to admit the will.
  • Notifies all beneficiaries included in the will, or intestate heirs, of the administration of the will.
  • Collects the deceased’s assets and lists them in an inventory.
  • Seeks court approval from the clerk to sell any assets as required.
  • Determines and pays claims against the estate.
  • Pays federal and state taxes.
  • Distributes the estate’s net assets, according to the court’s order, to the will’s beneficiaries, or heirs if there is no will.
  • Closes the estate.

5. DO I NEED A NEW WILL IF I MOVED FROM THE STATE WHERE MY WILL WAS DRAFTED? 

Generally, a will should be prepared in the state where you reside. Each state has its own requirements regarding will drafting and signing.  A newly revised will establishes your new legal residence, provides local witnesses, establishes your executor’s qualifications to serve in the state where you reside. 

6. WHAT HAPPENS IF I HAVE BENEFICIARIES LISTED ON A FINANCIAL ACCOUNT?  

People often think that a Will controls the distribution of their entire estate.  It is important to remember, however, that some assets are excluded if a beneficiary is designated for that asset.

7. WHAT OTHER METHODS ARE USED TO TRANSFER ASSETS TO BENEFICIARIES?

There are three (3) common methods exist by which some of your assets are transferred to your beneficiaries after your death:

  • Beneficiary designation
  • Joint ownership with rights of survivorship
  • Will or trust

8. WHAT ARE THE DIFFERENT FORMS OF BEQUESTS IN A WILL?

Gifts or bequests in your will can take various forms.  They can be cash or personal and real property. They can be given outright or in a trust.  Here are four generally accepted ways to make a bequest. 

  • Specific Bequest – This is a gift of a specific item to a specific beneficiary. 
  • General Bequest – This is usually a gift stated sum of money.
  • Contingent Bequest – This is a bequest made on condition that a certain event must occur.
  • Residuary Bequest – This is a gift of all the “rest, residue and remainder” of your estate after debts, taxes and bequests have been paid.

9. WHAT IS PROBATE?

Originally, probate referred to the court process for determining the validity of a deceased person’s will.  Over time and through custom and practice, probate now refers to the entire process of settling an estate. The term estate administration is also used to refer to the entire process of settling an estate.

10. WHAT IS THE PROCESS FOR PROBATE?

In general, here is the process:

  • Collecting and safeguarding of assets and the documents showing the value of the assets.  
  • Paying proper claims.
  • Filing tax returns.
  • Managing investments and other property.
  • Distributing estate assets according to the terms of the will.

11. WHY DO I NEED TO PROBATE AN ESTATE?

The process of probate is intended to protect and direct the distribution of property according to your will.  Not all assets go through probate.  Some assets such as life insurance policies and retirement plans where beneficiaries are named; assets you own jointly with rights of survivorship; and assets owned by a revocable living trust are some examples of assets that do not require probate. 

Although the loss of a loved one is difficult, often it is especially challenging for the person who has been named as Executor. 

12. WHO CAN I CONTACT FOR HELP TO PROBATE AN ESTATE?

Contact Ann-Margaret Alexander at Alexander & Doyle, PA to assist you during this time.  We will work with you to know what documents you need to locate; what type of notice needs to be provided to any creditors; and how to properly account for the assets, debts and proper distributions to beneficiaries.