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1. What FACTORS should I consider when hiring a lawyer to help with a probate?
The main FACTORS are if s/he can competently, timely and courteously provide all the following services under one roof: 1) file all documents with the court and provide notices to creditors and interested persons; 2) can properly compile an inventory and accountings so as to obtain the best tax effect for the estate and heirs/devisees, and 3) prepare the deceased’s final tax return and fiduciary returns.
THE ONE FACTOR that should scare you away is if s/he jokes, brags or affirmatively states s/he does not do numbers and defers to a CPA to prepare the accountings and tax returns.
Here is why: The focus of a lawyer and an accountant are not connected to the other because they deal with completely different matters. Yet at the same time, all are dependent upon the other to properly probate an estate in a cost and tax efficient way for the Heirs/Devisees (See Qs 5 and 6).
Lawyers are for the most part worried about minimally complying with Nevada statutory requirements to complete a probate. Lawyers also want to cultivate CPA referral sources and do not want to step on their toes.
Accountants are worried about complying with accounting quality control requirements that differ from Nevada statutory and federal tax filing requirements.
Loss in translation between Lawyer and Accountant. A lawyer who jokes or brags s/he does not understand accounting or taxes cannot effectively communicate with an accountant. An accountant cannot provide the lawyer with tax savings if s/he does not understand what is needed from the lawyer. Astonishingly we have two professions who should know the Nevada accounting laws but do not. Simply stated, there is a loss of translation between the two professionals that leads to lost tax savings and properly informing Heirs/Devisees of their share. See questions below about Inventory (See Q7) and Accounting (See Q8) for examples on how a lawyer complies with Nevada statutory requirements WHILE NOT properly keeping Heirs/Devisees informed.
2. What is probate?
Probate is the process that must be followed through the court system to clear and convey title to Probate Property (remember this, it runs through everything in a probate – See Q4) from a deceased to Heirs/Devisees (See Qs 5 and 6). The process includes finding all the assets of a deceased subject to probate, determining creditors and paying just due debts, paying administration expenses, and then finally paying what remains to heirs/devisees. See Qs 16, 17, 19 and 20 describing the four levels of probate in Nevada.
3. What is a Probate Estate?
A Probate Estate is every thing revolving court actions, Probate Property (See Q4), his/her debts and his/her Heirs/Devisees (See Qs 5 and 6).
4. What is Probate Property?
Probate Property is defined by what it is not. Non-probate property is property that transfers to another by “operation of law” (i.e. joint tenancy to real property) or by contract (life insurance proceeds or a beneficial interest in a trust). So, if property neither conveys by operation of law nor by contract, it is probate property.
5. What is a Devisee?
A devisee is someone named in a Last Will and Testament to receive something – cash, stock, jewelry, a car, a percentage of the estate, etc.
6. What is an Heir?
An heir is someone who will take from an estate according to Nevada intestacy statutes if a deceased dies without a Last Will and Testament.
7. What is an Inventory and why is it needed? How lawyers who do not understand important accounting principles fail the Personal Representative and Heirs/Devisees.
What an Inventory is: An Inventory is a document a personal representative files with the court advising Heirs/Devisees (See Qs 5 and 6) of Probate Property and values a deceased left at death.
Why an Inventory is important: It informs Heirs/Devisees of Probate Property (See Q4) the deceased left at death. This gives Heirs/Devisees the opportunity to provide feedback to the Personal Representative. It also provides Heirs/Devisees and accountants a central place to obtain values for tax elections and accountings.
How lawyer fail to file a proper Inventory: This is where a significant percentage of lawyers fail to advise the Personal Representatives to give Heirs/Devisees a breakdown of their share of the estate. Nevada statues only require listing of assets and values. The statutes do not address the most important thing – Heirs/Devisees want to know what is my share of the estate? Failure to provide Heirs/Devisees with their initial share feeds into the natural tenancy of human nature to believe something shady is going on. In turn unnecessary strife among all interested in an estate begins. Another issue lawyers fail to do is disclose values of the Probate Property on the inventory as of a proper date. This too causes significant negative tax consequences to the estate and Heirs/Devisees.
8. What is an Accounting?
An Accounting is a summary of income and expenses over a specified period of time (i.e… January 1, 20XX to December 31, 20XX).
Examples of Income are dividends, interest and rental income. Typical Expenses are for appraisals of property, costs to maintain property, burial expenses, etc.
Application of proper accounting principles will go a long way to keeping Heirs/Devisees (See Qs 5 and 6) informed and eliminate or reduce their mistrust and facilitates effective tax deductions. This is another place where a significant number of lawyers advise accountants on complying with Nevada statutes, but not adequately informing Heirs/Devisees of increases and reductions to their estate share. A big loss of translation many times negatively affects estates and its Heirs/Devisees. Frequently the tax savings of a proper accounting will outweigh the costs of the accounting. The costs of providing an accounting is mitigated because they are a tax deductible on the applicable fiduciary tax return (Form 1041).
9. In Nevada, is probate necessary if someone left a Last Will and Testament?
The mere existence of a Last Will and Testament does not determine whether a probate is required. What determines whether a probate is required is if the deceased left Probate Assets. (See Q4).
10. Is a probate necessary if a deceased did not leave a Last Will and Testament?
If someone dies and did not leave a Last Will and Testament, s/he died intestate. Preset default statutes (legalese – intestacy statutes), each state in the Union assumes the most likely individuals a deceased would have provided for will inherit what remains after a probate (i.e.. a surviving spouse and children). What determines whether a probate is required is if the deceased left Probate Property. (See Q4).
11. If I have a revocable living trust, is a probate required?
What determines whether a probate is required is if the deceased left Probate Property. (See Q4).
12. Does all property of a deceased person need to be probated after death?
What determines whether a probate is required is if the deceased left Probate Property (See Q4).
13. If a deceased leaves a Last Will and Testament not written in Nevada, will a Nevada court accept it?
Generally speaking, yes because of the Full Faith and Credit clause of the US Constitution. Nevada, however, requires a Last Will and Testament from another states be executed according to the state law in which it was signed.
14. How do I determined whether a probate is needed?
A process of elimination is performed on all property a deceased left at death. Property that neither conveys by operation of law nor by contract must be probated. (See Q4 for the definition of Probate Property).
15. Does Nevada have a time limit to file a probate?
16. Is there a way to avoid a probate where a deceased left property worth less than $25,000 or $100,000 for a surviving spouse?
Yes. Where the deceased leaves personal property the sum of ALL deceased left totaling $25,000 or less for Interested Persons (See Q18.) not a surviving spouse, or $100,000 or less for surviving spouses. Personal property is stuff you can pick up and move, including cash, and securities. All that is needed is to sign what is commonly known in Nevada as an Affidavit of Entitlement or Affidavit of Small Estate. Values of motor vehicles and military benefits do not count toward determining the $25,000 or $100,000 thresholds. If a deceased left real property (house or vacant land) worth less than $25,000 or $100,000, an Affidavit of Entitlement will not work. Nevada law requires a higher level of probate called Set Aside (See Q17).
17. What is a Set Aside?
A Set Aside Probate is a one-court-appearance procedure for estates worth $100,000 or less (after deducting encumbrances like a mortgage). This procedure is required where the deceased leaves real property, or if someone is not a surviving spouse but is an interested person (See Q18.) in the property worth up to $100,000 but greater than $25,000. A Set Aside requires the filing of a formal document usually called a “Petition for an Order to Set Aside Estate.”
18. What is an “Interested Person”?
Generally, an Interested Person is someone related (like a surviving spouse, a child, a parent, or a sibling) to the deceased, or who was named in a deceased’s will as a devisee or nominated as a personal representative.
19. What is a Summary Administration?
A Summary administration is a formal probate for estates with Probate Property (See Q4) worth greater than $100,000 but less than or equal to $300,000 (after deducting encumbrances).
20. What is a Full Administration?
A Full Administration is a formal probate for estates with Probate Property (See Q4) worth greater then $300,000 (after deducting encumbrances).
21. What are “Letters Testamentary” and who issues them?
Letters Testamentary or Letters Administration (“Letters”) is a document a court issues granting a person authority to act on behalf of an estate. A court generally issues Letters after an interested person petitions the court requesting an Order (See Q27) to issue the Letters. Letters Testamentary are issued where deceased left a Last Will and Testament; Letters Administration where the deceased died Intestate (See Q35).
22. How long does a probate take in Nevada?
A Set Aside (See Q17) takes about two months – the time to draft the Petition (See Q26), and appear in court. A Summary Administration (See Q19) takes about five months if everything goes well. A Full Administration (See Q20), takes about six to seven months if everything goes well. All times described in this answer is applicable to court action. There are still other matters to be addressed outside court matters like filing the deceased’s last tax return and the estate’s fiduciary tax return. As of 2019, time for a the Clark County Courts to place a Petition (See Q26) on its calendar are between 5 to 6 weeks.
23. What are the Costs and legal fees of a probate in Nevada?
First costs are separate from legal fees. Cost varies depending upon the type of probate. Each have their own court filing fees and publication amounts. Legal fees vary depending upon the size of the estate. Fees can range anywhere from a flat fee for a Set Aside of two to three thousand dollars, to several thousand dollars for Summary and Full Administrations. Summary and Full Administrations fees are typically calculated on an hourly or percentage basis according to the Nevada Revised Statutes. See our ebook on Probate In Nevada for a fuller discussion of determining when to accept an hourly vs a percentage. We at Crest Key charge a FLAT FEE (that is right we do not charge hourly or percentage) for matters in the Ordinary Course (See Q25) in a Summary Administration (See Q19) and a Full Administration (See Q20) probates.
24. What costs and fees in addition to legal fees are typical in a Probate in the Ordinary Course?
Court filing fees, publications in a local news paper for certain hearings and/or to unknown creditors. Law firms also typically charge for copies, postage, runner fees, recording of documents in the applicable recorder’s office, etc. Estates typically incur additional accounting and tax fees for preparation of accounting and tax returns for the deceased’s final return and any fiduciary income tax returns, and obtaining appraisals of property.
25. What is a probate in Ordinary Course?
a probate in the Ordinary Course typically involve filing pleadings (documents filed with the court) necessary to open, administer, and close an estate. Ordinary Course also involves giving notice to and tracking known and unknown creditor claims, and advising the personal representative of possible payment of the same. Typical pleadings filed are to open the probate and issue Letters Testamentary/Administration (See Q21), publish notice to creditors, track creditor claims, filing inventory (or waiver when applicable) of discovered assets of the deceased, and then filing pleadings to close the estate and show proof of compliance with court orders (See Q27). Attendance at the hearing on pleadings are also included. (See Q29 for fees for services outside the Ordinary Course.)
26. What is a Petition?
A petition is a document filed with the court that complies with the requirements under the Nevada Revised Statutes, Nevada Rules of Civil Procedure and local court rules advising the court of facts and applicable laws the court needs to support a request for a certain result in an Order (See Q27).
27. What is an Order?
An Order is a court ruling containing supporting facts and applicable law on a specific issue(s) brought to the attention of a court through the filing of a Petition (See Q26).
28. What do Extraordinary Services typically include?
Extraordinary Service include sale of personal and real property, operation of deceased’s business, participation in litigation, securing a loan to pay debts of the estate, preparation of taxes for the deceased and estate, and ALL other matters outside the scope of services in the Ordinary Course (See Q25).
29. What are typical legal fees for matters outside the Ordinary Course?
Typically, law firms charge by the hour (typical hourly rates in 2019 are noter of $300/hour) in Summary and General Administrations. Common examples of matters outside a Probate in the Ordinary Course (See Q25) is the sale of personal or real property, requesting for additional time to publish an inventory of Estate assets, accountings; petitions to operate the business of the Deceased, litigation, and income tax preparation.
30. What rights do I have to read the Last Will and Testament of a family member?
In Nevada, the individual who has possession of the Last Will and Testament of a deceased has a general obligation to file it with the court within 30 days after the date of death of the deceased or finding out of the death of the deceased, whichever is later. If s/he does not file it, Interested Persons (See Q18) have a right to recover damages if they are injured. For example, assume there is no property to be probated, if the person in possession of the Last Will and Testament does not file it with the Court, there is no damage. Sorry, hurt feelings are not an injury.
31. Can the courts in Nevada probate property located in another state?
The answer depends upon the type of property and the state in which the deceased was a resident at the date of death. First, real property (a residence, building, dirt) is always probated (if Probate Property – See Q4) in the court in the state in which the property is located. States always have the right to determine how real property within its borders is conveyed. So, Nevada courts cannot probate real property located in, say Maine; only the courts of Maine can probate the real property. Personal property (if Probate Property), no matter the location – like Italy or the moon, on the other hand, is generally probated in the court of the state where the deceased died a resident.
32. If a probate is started in another state, is a probate also required in Nevada?
Maybe. All depends upon state of residency of the deceased at death and if real property subject to probate (See Q4) of the deceased is located in Nevada.
33. How do I know what state an individual died a resident?
This question is usually not hard to determine because every Interested Person (See Q18) likely knows the home where deceased regularly returned to seek shelter and privacy. Where residency is a question, here are some factors to consider where:
- Did the deceased spend most of her/his time,
- Was deceased registered to vote,
- Was residential real property located the deceased regularly returned to,
- Motor vehicles were registered,
- Taxes were paid,
- His/Her children regularly attended school, and
- Did the deceased regularly attend church, etc.
34. Is an attorney required to be hired to probate an estate in Nevada?
The answer is no. A person who is nominated in a Last Will and Testament to serve as Personal Representative (See Q40), or who has priority under Nevada Revised Statutes may file papers (a Petition – Q26) with the court in pro per to be confirmed as Personal Representative. While a lay person (a non attorney) could figure out how to file all the documents with the court, notice creditors and address claims, coordinate filing of an inventory, calculate the accountings, and file closing pleadings, figuring all out could turn out to be very time consuming. If you are retired or are unemployed, and no family fusses arise, this may be a viable option.
35. What does it mean when someone died Intestate?
When a deceased dies without a Last Will and Testament, s/he died “intestate.” When that happens, Nevada Revised Statutes exist to direct who will serve as Personal Representative (See Question 40) and who will take after a Probate (See Question 2) is complete. If a deceased died with a Last Will and Testament, s/he died “Testate.” Now to dispel a mistaken belief: The state of Nevada DOES NOT automatically get/take all the deceased property if the deceased died without a Last Will and Testament. The deceased must die without any heirs. Then, and only then will Nevada get/take the deceased’s property. When the state of Nevada gets the deceased’s property it is called escheats.
36. What is an Independent Administration of Estates?
An Independent Administration of Estates releases a Personal Representative from the requirement of obtaining court confirmation–like the sale of property. The court can allow a full or limited independent administration.
37. What are the advantages of probate?
The main advantage is court supervision of the Personal Representative. Another is resolving disputes between or among family member as to the disposition of property the deceased left behind. Finally, to obtain a court Order (See Question 27) that could provide a tax advantage – like ordering property status was community property between the deceased and the surviving spouses.
38. What are the disadvantages of probate?
Public airing of private matters, publication of deceased’s property in public records, delay in distributions to Heirs/Devisees, legal fees and court costs.
39. What rights do “Interested Persons” have under Nevada probate law?
Except to the extent granted to a Personal Representative (See Q40) under the Independent Administrations Act (See Q36) to not provide notice, Interested Persons (See Q18) have a right to be notified of actions the Personal Representative takes while administering a probate estate.
40. What is a Personal Representative?
A Personal Representative is an individual who the court confirmed to act on behalf of an estate (i.e… like gather assets, notice creditors, sell property after court confirmation). A person named in a Last Will and Testament to serve as personal representative or who possesses priority under the Nevada Revised Statutes of an estate IS NOT a personal representative until a court confirms the individual. In other words, any one named in a will or who possesses priority under the Nevada Revised statutes is a nomination only. Once the court confirms an individual as personal representative, that is when s/he possesses authority to act on behalf of an estate. A Personal Representative is either nominated in a Last Will and Testament, or if a deceased dies intestate (See Q35), according to priorities outlined in the Nevada Revised Statutes.
41. Does anyone have the right to be a Personal Representative?
No. The deceased in a Last Will and Testament can nominate a personal representative, or only those individuals who have preferential status under the Nevada Revised Statutes. A court still has to confirm an individual as Personal Representative (See Q40). The person asking to be confirmed must meet certain minimum requirements (i.e.. not convicted of a felony, not a drunk, is of sufficient age, etc.).
42. Can more than one Personal Representative serve at the same time for an estate?
43. What are the main duties of a Personal Representative in Nevada?
A person who a Nevada court confirms as Personal Representative (See Q40) has a duty to:
- Find and protect during the probate of all property of the deceased,
- Keep heirs/distributees informed of progress and significant events,
- Determine and pay debts deceased rightfully owes,
- Provide an inventory of assets found, liquidate property if necessary,
- Pay administration expenses,
- Provide an accounting of financial transactions, and
- Distribute the balance to heir/distributees.
44. If I am a Personal Representative, can I be required to personally pay the debts of the deceased?
Yes and No. If you personally guaranteed a debt of the deceased, then yes you will because of a prior commitment. Also, if you did not pay creditors before distributing money to Heirs/Devisees, you will be personally responsible. If you get court confirmation to pay creditors, you are not responsible if there is not enough to pay all the deceased owed.
45. Does the Personal Representative have to tell the Heirs/Devisees what s/he is doing?
Generally a Personal Representative (See Q40) must keep Heirs/Devisees (See Qs 5 and 6) informed of significant matters. For example Personal Representative must give notice of an Inventory, Accounting, sale of property, and payment of creditor claims.
46. Are Personal Representatives required to file an inventory and accounting of Probate Property?
Yes. Personal Representatives must file an inventory and accounting and send them to Heirs/Devisees (See Qs 5 and 6). There is one exception where all Heirs/Devisees agree to waive the filings. Regardless, we suggest creating an Inventory and Accounting and give it to Heirs/Devisees. This keeps Heirs/Devisees informed and eliminates or reduces their concerns. Also an inventory and accounting will provide support in preparation of the deceased’s last tax return and fiduciary returns. We have seen many times where a Personal Representative did not produce an accounting and lost significant tax deductions. This caused tax dollars be paid that should have gone to heirs/devisees.
47. Can the Personal Representative delegate his or her power to someone else?
Yes, but delegate carefully.
48. Who decides if Probate Property is to be sold or kept and passed to the heirs?
Language in the applicable Last Will and Testament may provide guidance. If no such language exits, then Nevada law gives the Personal Representative (See Q40) authority to dispose of Probate Property. We generally advise the Personal Representative to give Heirs/Devisees (See Qs 5 and 6) the opportunity to acquire the property.
49. What can I do if I don’t agree with the decisions of the Personal Representative?
Tell the Personal Representative (See Q40) and/or file a Petition (See Q26) with the applicable court stating your concerns.
50. May the Personal Representative be a creditor of the estate?
Yes, but s/he is subject to closer court scrutiny to determine if the claims are appropriate.
51. Can the Personal Representative be removed?
Yes, for breaching her/his duties.
52. Does Nevada law require a Personal Representative to give notice to creditors; if not, why should notice be given?
Nevada law does not require a Personal Representative (See Q40) to give notice to creditors. If no notice is given, creditor claims remain, and no Probate Property remains, then the Personal Representative is personally responsible.
53. How is notice to creditors given in Nevada?
For known creditors, direct mailing of a notice to file a claim. For unknown creditors, by publication. Whether a creditor is known or unknown, the notice must contain proper statutory language.
54. Is an appraisal required for real estate before it can be sold?
Yes because Nevada law requires it, and to determine the basis in calculating income taxes to the estate.
55. What happens if there is not enough money in the estate to pay probate expenses, creditors, and Heirs/Devisees?
Probate expenses attorney and personal representative fees are paid first. Then last illness expenses of deceased, federal taxes, creditors, and if any money is left over, to the Heirs/Devisees.