MN

Starting the Informal Probate Process in Minnesota

Posted on by jlawyer

Minnesota probate processIf you want to probate a simple estate involving limited property, ask your lawyer if you can initiate the informal probate process. An informal probate is a fairly straightforward approach.

As for the general requirements, you’ll need to first check with your lawyer or county probate court because some Minnesota counties allow you to initiate the probate process online while others insist you do so in person. Here’s a quick review of what you and your attorney must include in the application to begin probate in this manner.

Information That Must Be Included in Your MN Informal Probate Application

  • Clear statement about your identity. You must tell the court what your interest is in the proceedings – whether you’re a spouse, child, personal representative or another party;
  • Specific data identifying the decedent. Be sure to include this person’s birth and death dates, along with the county and state s/he was living in at the time of death;
  • Provide contact data for all close relatives. In other words, list the names and addresses of the deceased person’s spouse, as well as his/her children, heirs – or other people named in any Will that may have been found. Also, if any of the children are minors, you need to list their ages;
  • Note where the decedent was living if his/her formal domicile was not MN at the time of death. This informs the court of the proper venue for probating the estate;
  • Identify the personal representative, if you have this information. Be sure to provide this individual’s address, too;
  • Include information about other related filings. If you know or believe that there’s been another probate or “appointment proceeding concerning [the] decedent” in MN or somewhere else – be sure to include this data, too.

In cases where the decedent left behind a Will, you must also include the following information in your application to initiate a probate.

  1. The location of the Will must be described. You need to state whether the Will is already in the court’s possession, is attached to your application or if you’re providing an authenticated copy of a Will that’s been probated in another jurisdiction;
  2. Reference if the Will has been properly executed. Check to be sure all proper parties signed the Will and that it was duly witnessed and notarized;
  3. Validity of Will statement. You must be able to truthfully state that you have no knowledge (after checking) – that the Will has been revoked;
  4. Statement that you’re filing the application in a timely manner.

Keep in mind that, in Minnesota, applications for both informal and formal probate “must be initiated within three years after the decedent’s death.” Always check with your Minnesota probate attorney when you believe that there could be a challenge to the timeliness of filing the application.

Response to Your Application

You should be able to quickly learn if the probate registrar views your application as complete. Once this decision has been made, the registrar will issue a statement of probate and appoint a personal representative.  After you have successfully filed an application for the informal probate of an estate, the registrar will allow the personal representative to pay debts and inheritances, and complete all of the other required tasks without court supervision. Be sure to ask your lawyer what other rules or procedures may apply if the personal property involved in your Minnesota estate is worth less than $75,000.

Should you need to review the types of documents often required during the probate process, please visit an earlier article of ours entitled, “The Most Useful Minnesota Estate Planning Documents.”

Free Initial Consultations

Contact the Flanders Law Firm today.  The firm offers free consultations to all potential clients.  Call (612) 424-0398.

Minnesota Probate Law | Second marriages, Surviving spouse, and Children

Posted on by jlawyer

Minnesota Probate LawIn many Minnesota probate consultations that my office handles, there are often instances when a person who has died leaves behind many different people who may have a legal interest in that person’s estate.

People Who Have an Interest in the Deceased Person’s Probate Estate?

Common persons you may have an interesting deceased person’s estate, whether they had a Will or died without a will, are:  a surviving spouse, children, heirs, distributees, grantors, grantees, and other interested parties (creditors).

Furthermore, a common situation is when the person who died had children from a prior marriage but was remarried. Other times, the person may have been estranged from her spouse for multiple years but never divorced the person. These situations can create complicated issues with the deceased person’s probate administration. Often times, the result can be unfair to the surviving beneficiaries.

The major problem with surviving spouses and second marriages is that, if the person did not have a Will, and sometimes even if they did have a Will, the surviving spouse and second marriages is that the surviving spouse is entitled to benefits above and beyond what anyone else may receive. These estate benefits can include right to a portion of the deceased person’s homestead and what is called elective share of the probate estate.

Elective share of the probate estate

An elective share of the surviving spouse in addition to other benefits that the surviving spouse may receive, is based largely on the number of years in which the couple was married. Minnesota law is cited below for reference:

524.2-202 ELECTIVE SHARE.

(a) Elective share amount. The surviving spouse of a decedent who dies domiciled in this state has a right of election, under the limitations and conditions stated in this part, to take an elective-share amount equal to the value of the elective-share percentage of the augmented estate, determined by the length of time the spouse and the decedent were married to each other, in accordance with the following schedule:

If the decedent and the spouse were married to each other: The elective-share percentage is:
Less than one year Supplemental amount only
One year but less than two years Three percent of the augmented estate
Two years but less than three years Six percent of the augmented estate
Three years but less than four years Nine percent of the augmented estate
Four years but less than five years 12 percent of the augmented estate
Five years but less than six years 15 percent of the augmented estate
Six years but less than seven years 18 percent of the augmented estate
Seven years but less than eight years 21 percent of the augmented estate
Eight years but less than nine years 24 percent of the augmented estate
Nine years but less than ten years 27 percent of the augmented estate
Ten years but less than 11 years 30 percent of the augmented estate
11 years but less than 12 years 34 percent of the augmented estate
12 years but less than 13 years 38 percent of the augmented estate
13 years but less than 14 years 42 percent of the augmented estate
14 years but less than 15 years 46 percent of the augmented estate
15 years or more 50 percent of the augmented estate

(b) Supplemental elective-share amount. If the sum of the amounts described in sections 524.2-207,524.2-209, paragraph (a), clause (1), and that part of the elective-share amount payable from the decedent’s probate estate and nonprobate transfers to others under section 524.2-209, paragraphs (b) and (c), is less than $50,000, the surviving spouse is entitled to a supplemental elective-share amount equal to $50,000, minus the sum of the amounts described in those sections. The supplemental elective-share amount is payable from the decedent’s probate estate and from recipients of the decedent’s nonprobate transfers to others in the order of priority set forth in section 524.2-209, paragraphs (b) and (c).

(c) Effect of election on statutory benefits. If the right of election is exercised by or on behalf of the surviving spouse, the surviving spouse’s homestead rights and other allowances under sections 524.2-402,524.2-403 and 524.2-404, if any, are not charged against but are in addition to the elective-share and supplemental elective-share amounts.

(d) Nondomiciliary. The right, if any, of the surviving spouse of a decedent who dies domiciled outside this state to take an elective share in property in this state is governed by the law of the decedent’s domicile at death.

Children and Heirs of the deceased person

The heirs of a deceased person are often upset to find out that a second spouse, who is the surviving spouse, will receive significant benefits from the estate. This is true even if the surviving spouse may have been estranged from the deceased person and the deceased person may have even contemplated divorce.

There are some exceptions to this rule, as there always is, and a qualified probate attorney should be consulted if you have questions.

Surviving Spouses, Probate in Minnesota

If you have specific questions about a deceased person’s estate, whether yours a surviving spouse or a child of a deceased person, please contact the probate attorneys and lawyers at Flanders Law Firm LLC to discuss your specific situation.  Another good resource is the Minnesota attorney general.

There may be a remedy that you are unaware of or had not considered. The firm offers free consultations to all potential clients. Call the law firm at 612-424-0398.

Minnesota Probate | What to bring to initial meeting with a lawyer?

Posted on by jlawyer

Minnesota Probate Medical AssistanceClient are often concerned about what exactly they need to bring to an initial meeting with a Minnesota probate attorney.

This post will hopefully provide some answers to the above question.  While the information in this post is for information purposes only, it should give you a good idea of what a probate lawyer would be looking for.

DOCUMENTS FOR THE CLIENT TO BRING TO THE MEETING

  • Original copies of the will and all codicils
  • A list of names and addresses of heirs and will beneficiaries
  • The death certificate (if available)
  • Real estate tax statements and title papers for real estate (registered or abstract?)
  • All available information about assets and their values
  • The last income tax return of decedent
  • A list of questions the client may have

Items to Bring to Initial Meeting with the Probate Lawyer

Questions for heirs:

  • Did the decedent leave a will?
  • If so, where is the original? If the original is not available, is a copy available?
  • Who is nominated in the will as personal representative?
  • Is the nominated person willing and able to serve?
  • If there is no will, determine the same facts as in the determination of heirs (below):
  • Was the decedent survived by a spouse?
  • If not, did the decedent have any children who survived the decedent?
  • Is there a surviving spouse?
  • Did the decedent ever have, or adopt, any children?
  • If so, what are the names, ages, and addresses of the children, and issue of a deceased child, who survived
  • the decedent by 120 hours?
  • If there are no living issue or spouse of the decedent, the heirs are determined in the order set forth in
  • Minnesota Statutes section 524.2-103 – parents, their descendants, grandparents and their descendants,
  • and then next of kin.

Minnesota Probate Assets & Jurisdiction:

  • In what state was the decedent domiciled?
  • In what state(s) did the decedent own property that was not disposed of by a will substitute (such as joint tenancy or a living trust)?
  • Is the total value of the estate, including life insurance and retirement plans, likely to exceed $1,000,000?
  • Did the decedent own any real estate in Minnesota, or elsewhere?
  • What was the decedent’s occupation?
  • What property is registered in the name of the decedent? (If the decedent was survived by a spouse, was
  • the title in both names?)
  • Bank accounts
  • Automobiles
  • Securities
  • Life insurance
  • Retirement plans (including IRAs and annuities)
  • Businesses
  • Other valuable items

Free Initial Consultations

Contact the Flanders Law Firm today.  The firm offers free consultations to all potential clients.  Call (612) 424-0398.

Personal Representative Liability for Failure to Pay Probate Estate Taxes

Posted on by jlawyer

MN Probate TaxesAn important case was issued recently out of the Western District Court for the Western District of Pennsylvania, United State v. Stiles, No. 2:13-cv-00138.

This case provides and excellent explanation for why people should not administer estates (especially large ones) without the help of a lawyer.

Facts of the Case

Julia Stiles died in 2002.  Her son was appointed executor (personal representative) of her estate (it is not clear whether he did so with the use of an attorney or not).

The tax return for the estate was not filed until June of 2008. On June 9, 2008, a representative of the Secretary of the Treasure Internal Revenue Service of the United States (IRS) assessed federal income taxes, interest, and penalties against the estate in the amount of $2,093,091.  That is a lot of money in taxes.

The real property in the state of Delaware was sold in August 2002, for $379,000.  Once the property was sold, the proceeds were distributed to the heirs shortly after the sale.  The IRS did not receive any proceeds from the sale of the property.

Between 2002 – 2005, the son distributed approximately $775,000 from the estate to himself, and $425,000 to each of his two sisters.  At the start of April 2008, the estate’s investment account was worth $1,787,660.  In April of 2008, David Stiles distributed $110,635 from the estate to the Delaware Division of Revenue.

The IRS can Charge Interest on Late Payments

The IRS presented evidence to the court that interest was owed on unpaid income taxes.  Interest on the income tax assessments is assessed under 26 U.S.C. 6601(a) and (b) from the date that the Stiles’ tax liabilities became due at a rate set forth in 26 U.S.C. 6621(a).  Penalties are also allowed by federal law.

The law on failing to pay estate taxes

The IRS in this case filed for a summary judgment.  In essence, this means that the IRS felt that the Stiles had not cognizable defense.  The court agreed.

In seeking to foreclose its tax lien on the estate, the IRS argued in its summary judgment motion that there was a prima facie assumption of tax liability.  Therefore, since the government had arguably met its burden, the Stiles had to file a responsive statement of facts.  They did not do so – ostensibly because they did not appear to be represented by counsel.

Personal Representative Liability Law

The personal representative of the estate also argued that the estate was now insolvent and therefore the IRS could not foreclose in its tax lien.

The IRS argued that, because the personal representative of the estate was a fiduciary that it could hold him personally liable for the tax debt.  The IRS cited law which provided that:

“Personal liability can attach, to the extent of the distribution, if the government establishes three elements: (1) the fiduciary distributed assets of the estate; (2) the distribution rendered the estate insolvent; and (3) the distribution took place after the fiduciary had actual or constructive knowledge of the liability for unpaid taxes.” United States v. Tyler, No. 10-1239, 2012 WL 848239, at *10 (E.D. Pa. Mar. 13, 2012). “

The court agreed with the IRS’s argument and found the personal representative liable for a tax debt in the amount of

What is even more confounding is that the personal representative admitted that he knew about the tax liability:

David Stiles admitted, through testimony, that he knew in 2002 about the estate’s federal tax liabilities. (ECF No. 35 ¶ 17); see Estate of Stiles, 2011 WL 5299295, at *6 (“[David] Stiles testified at trial that he knew as of 2002 that estate taxes would have to be paid in addition to the yearly fiduciary income taxes, but he made no affirmative efforts to pay those taxes or learn of the deadlines by which they should have been paid.”). On June 18, 2003, during a telephone call with his lawyer, David Stiles was informed that the estate’s tax returns were late. Estate of Stiles, 2011 WL 5299295, at *6. Based on the record before the court, David Stiles knew about the estates’ tax liability, at the latest, on June 18, 2003. David Stiles continued to distribute assets out of the estate through 2006.3 (ECF No. 35 ¶ 19.) The record before the court shows that David Stiles had knowledge of the estate’s tax liability and continued to distribute assets out of the estate rendering it insolvent. See Tyler, 528 F. App’x, at 200-02.

Finally, it appears that the personal representative was relying on a defense of bad legal advice.  The court also did not find this argument compelling, providing that:   “Relying on the poor advice from an attorney is not a defense. It is unfortunate that the Stiles received poor legal advice; however, poor advice does nothing to mitigate their liability for the decisions David Stiles made in managing the estate.”

Seek out competent legal counsel

Having experienced, competent probate attorneys for a Minnesota probate is a must.  Personal liability is very real and must be taken seriously by all potential personal representative.

For further information, contact Joseph M. Flanders at 612-424-0398.

Minnesota Probate | Inventory of Estate

Posted on by jlawyer

Minnesota Living Trust

In every probate administration, the personal representative will be required to gather all assets and debts and compile a document called an Inventory.

While “inventory” is the correct legal word to use, the legal basis for drafting the document and filing it with the court is that an accounting of the assets and debts of the estate must be done.

Inventory and assets and debts of the probate estate

The Inventory will be sent to all interested parties in the estate. Interested parties include:  heirs, descendants, surviving spouses, specific devisees, and all creditors of the estate.

People often understand that heirs of an estate are entitled to something.  However, it has been my experience that people may not understand that creditors are also entitled to review the inventory.  Creditors include credit card companies, mortgages, contracts of the deceased person, or any other party to which the seas personal money too. If the deceased person owed money to someone, it is logical to see why that person would be entitled to a review an estate Inventory.

We have talked about what the legal meaning of assets and debts are in many pretty previous posts. We have also discussed what probate estate exemptions may apply in Minnesota. Please click on the prior posts for further information on those two topics. If there are exempt assets, this means that creditors may not get paid. If you have further questions about what may or may not be exempt, talk with a probate lawyer.

The Personal Representative’s Responsibilities

The personal representative of the estate, is required to draft an inventory, send copies to all interested parties, and file the document with the proper county court where the deceased person died. We’ve also discussed what the proper county court is in the state of Minnesota and prior articles.

There may be an informal, unsupervised administration or a formal supervised administration.  How something is filed will dictate many of the required court filings and how the court supervises the personal representative’s actions. Again, for further questions on what unsupervised and supervise more formal and informal administrations mean, a probate lawyer should be contacted.

In essence, it is been my experience that personal representatives may not understand the requirement of reviewing all of the deceased person’s debts and assets, compiling those that information in an Inventory, and sending that Inventory to all interested parties. This, in essence, defines the why the probate process is necessary and it is very important function of the Minnesota probate court system.

For Further Information on Probate Inventories

Flanders Law Firm LLC has Minnesota probate attorneys waiting to answer your questions.  For further information on probate inventories and probates in Minnesota, contact the law firm at 612-424-0398.

What are the fiduciary duties of a Minnesota personal representative?

Posted on by jlawyer

fiduciary duties of a Minnesota personal representative? In any Minnesota probate, a personal representative will be appointed to run the estate.

If there are over $75,000 in probate assets, the estate will need to be probated by the personal representative. The assets of the estate will be distributed to the heirs of the deceased person.   Distribution can be effectuated by the deceased person’s Will or via an intestate administration.  An intestate administration means someone died without a Will. Typically, a person will work with an attorney to follow the law and understand what they must do according to the law.

We often discuss the legal concept of “fiduciary duties” with out clients.  The personal representative must serve as a “fiduciary” for all heirs, creditors, and other interested parties.

Fiduciary duties of a Minnesota personal representative?

In a typical probate, the personal representative will have a fiduciary duty obligation to the heirs.

A typical situation my office sees is where the children of the deceased person are the only heirs.  In this scenario, the eldest child is often “nominated” by the deceased person to be the personal representative.

The personal representative must pay expenses of the estate and then distribute assets and money to their siblings.  While working on the estate, the personal representative owes fiduciary duties to their siblings – whether they like them or not.  Sibling rivalry can often get in the way of a proper administration.

It is also important to remember that the personal representative has a difficult job and that the money in the estate does not belong to them.

The personal representative is serving the estate. There are many instances of probate litigation (lawsuits) where the personal representative may not be doing what they are supposed to be doing. When thinking about the term fiduciary duty, please try to remember that it means to be honest and fair with the deceased person’s money.

Duties owed to creditors in a Minnesota probate estate

The personal representative will also owe a fiduciary duty to creditors of the estate.  If there is over $75,000 in probate assets, the personal representative is required to distribute assets and pay creditors.

Commonly, the debts of the estate include a mortgage on home, credit-card bills, utilities, and other contractual debts of the deceased person. Sometimes, the estate has very little debt because, as people age, they often pay off the home and other debs.

There are also certain probate asset exemptions which we discussed in previous articles.  Exemptions include:  the homestead of the decedent, $10,000 of personal property, and one automobile.  Life insurance is also an exemption.  This means that assets will not be collectible, in most instances, by creditors.

Paying creditors claims is relatively simple.  If the personal representative has knowledge of money owed to any person or business, those debts should be paid out of the estate. However, there are also instances when a personal representative does not have knowledge of debts owed by the deceased person.  In these instances, the notice of publication – which is published in the newspaper –  will be published so that unknown creditors have four months in Minnesota to file a claim against the estate.

It is very important for the personal representative to work hard to discover debts that need to be paid.  After payment of debts (minus exemptions), the remaining money will then be distributed to heirs.

As a warning to people who may be considering serving as a personal representative – not paying estate debts is where liability of the personal representative most often arises. This is because, at times, the personal representative may not be diligent in discovering otherwise known creditors.  Obviously, this can be a very large problem.  The court may hold the personal representative liable for not doing their job correctly.

An personal representative may want to speak with a probate attorney

For further information about the meaning of personal representative duties, and fiduciary duties, contact Joseph M. Flanders, a Minnesota probate lawyer, at 612-424-0398.

The firm offers free initial consultations in all cases.