How Much Does Probate Cost? | Minnesota Estate Law

How Much Does Probate Cost?The Costs of Probate

If you have failed to take early action and pass away without an estate plan in place, it’s likely that those you live behind will be forced to deal with probating your remaining assets. For obvious reasons, this might not matter much to you. However, it may matter a great deal to your loved ones. Beyond being time-consuming, bureaucratic and complex, probate can also be expensive. And who gets stuck paying the bill? You. The assets that you left behind are diminished to cover the costs associated with the probate process, leaving less to distribute amongst your heirs. To learn more about some of the costs of probate, keep reading.

Probate Fees and Court Costs

First, let’s make an important point about the costs of probate: everything is relative. Though some fees apply across the board, such as court costs, most vary depending on the size and extent of the underlying estate. The greater the value of the probated property, the more expensive probate will be; something worth keeping in mind.

Speaking of court costs, these fees represent one unavoidable aspect of the probate process. Thankfully, it’s also one of the cheapest expenses that you’re likely to incur. Though there’s no uniform amount to budget for, fees typically vary between a few hundred dollars to more than a thousand. Though it isn’t cheap, court fees aren’t usually responsible for eating up estates.

Personal Representative Fees

The next big category of expense is personal representative fees. These fees are dictated by state law. In some places, like Florida, all personal representatives are entitled to a flat 3 percent of the value of the estate. In Minnesota, things aren’t so simple. Minnesota law (Minnesota Statute Section 524.3-719)  says that personal representatives are entitled to a “reasonable” fee for their work. How much that amounts to depends on how much time and energy the probate case takes. The size and complexity of the estate will likely figure into this calculation. If it’s a large estate that requires a significant commitment of time (which isn’t unusual), then the personal representative’s fee may prove quite costly. If your personal representative is feeling generous, he or she is also allowed to waive the fee.

Costs of Administration

Beyond the personal representative, probate attorneys and accountants can also request a share of the estate to help pay for their work. In both cases the amount of the fee will depend on the value of the estate and the complexity of the estate management and distribution. Both accountants and lawyers will keep track of their time and submit bills to the court asking for reimbursement of their work on behalf of the probated estate.

A final category of fees paid out during probate falls under the “miscellaneous” heading. You need to keep in mind the cost of mailing notices and other documents to the court and to heirs of the estate. There’s the cost of moving, storing and insuring probated property to ensure it isn’t damaged while waiting for the estate to be divided. If a house is involved, the costs can really start to add up, with the personal representative being forced to use estate funds to pay for home upkeep and repair as well as any bills associated with keeping the property in good condition.

Though the amount of money varies widely, experts say that if your estate ends up in probate court it is possible that between 3 and 8 percent of the total value of the estate could be lost due to payment of fees. Though it may not sound like much, adding up all the money that won’t be going to your heirs, but will instead go to paying courts, accountants and attorneys, might be enough to make you rethink creating an estate plan.

Minnesota Probate Lawyers

An experienced Minnesota estate-planning lawyer can help walk you through the complicated process of establishing a workable estate plan. For more information on estate planning in Minnesota, along with a variety of other topics, contact Joseph M. Flanders of Flanders Law Firm at  (612) 424-0398.

 

Source: “How Much Does it Cost to Settle a Trust After the Trustmaker Dies?”, by Julie Garber, published at TheBalance.com.

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