What Is Probate in Arizona: AZ Probate Laws
You spend your entire adult life building up money, property and assets. Since “you can’t take it with you,” what happens to your assets after you die? The heart of estate planning.is passing on your assets to your chosen beneficiaries after you die through wills, trusts, and other instruments, to the extent that Arizona probate rules give you a choice. Think of estate planning the process of you making the decisions now on paper so that the Court does not have to decide for you when you pass on.
What Does Probate Involve?
Many things must be done when someone dies, including arranging a funeral, obtaining a death certificate, locating the will, paying off debts, and distributing the remainder of the assets to beneficiaries selected by the deceased or mandated by law.
Probate in Arizona is governed by specific probate laws. These laws are designed to prevent the distribution of assets to beneficiaries from becoming a free-for-all that could lead to theft or even violence. It is possible to resolve many simple and undisputed cases electronically, although you have to go to court in some cases.
Court appearances are particularly likely if the decedent died without a valid Will, or if a dispute arises among potential beneficiaries. Hiring a skilled estate planning lawyer is your best chance of avoiding court.
How Do Arizona Probate Laws Work?
Probate laws in Arizona don’t apply to every estate. Not all estate assets have to go through probate, and some estates lack any assets that are subject to probate. In fact, in many cases, it is possible to avoid probate altogether through the clever exploitation of the Arizona rules of probate procedure. You will need an experienced estate planning lawyer to do this properly.
So how does probate work in Arizona?
- The court appoints an executor.
- The executor (also known as the personal representative) inventories the estate and notifies all creditors and debtors of the estate of the probate process.
- The executor will collect estate assets and pay estate debts (including taxes) under the supervision of the court.
- The executor distributes all remaining assets as directed by the Will and the court.
At this point, the court will close the probate.
Examples of Probate
Following are some examples of assets that are typically subject to probate:
- Real estate that the decedent solely owned (not in joint tenancy, for example);
- The decedent’s share of assets held as tenants in common;
- High-value personal property such as automobiles and artwork;
- Assets held by a testamentary trust (not a living trust);
- Accounts that are not transferable or payable on death.
Even assets such as these can be restructured so that they do not pass through probate. The assets of a testamentary trust, for example, can be transferred to a living trust.
When Is Probate Required in Arizona?
Arizona requires probate unless the decedent’s assets are all owned by a living trust or they have designated beneficiaries. Perhaps the best way to identify assets that must go through probate is to list the assets that are not subject to probate. These assets include:
- Small estates, with personal property valued at less than $75,000 and real property valued at less than $100,000;
- Property held in a living trust;
- Life insurance policies with a named beneficiary;
- Property held in joint tenancy;
- Joint bank accounts;
- Community property with right of survivorship (for married couples);
- Payable-on-Death (POD) bank accounts; and
- Survivor’s benefits for retirement plans.
This is an incomplete list. Speak with your attorney if you are unsure whether a particular item should go through probate.
What Are the Types of Arizona Probate Proceedings?
Arizona offers three types of probate to account for varying needs. These types of probate include:
- Informal probate. You use informal probate if there is a valid Will and nobody disputes its provisions. Informal probate involves minimal court supervision.
- Formal probate: Formal probate occurs when some kind of dispute arises–over who should be the executor, how a provision of the will should be interpreted, etc.
- Supervised probate: Supervised probate is the strictest form of probate in which the court supervises everything that happens. The executor, for example, can do almost nothing without the permission of the court.
Which form of probate applies depends largely on the court’s discretion.
Arizona Probate Process
Following is a general step-by-step guideline of the probate process in Arizona. The specifics may vary from case to case.
- Someone (typically the named executor) files the Will with the court.
- The court formally appoints the executor. This persona is usually, but not always, the person appointed in the decedent’s Will if there is a valid Will.
- The executor publishes notice of probate to all potential estate creditors.
- The executor inventories the estate pays estate bills, collects estate assets, sells assets, and distributes assets to beneficiaries, typically tinder some form of court supervision.
- The executor files a closing statement to formally close the estate.
Once the estate has been closed, the executor’s job is finished.
Arizona Probate Law Frequently Asked Questions
How long does probate take in Arizona?
How long is the probate process? The answer to that question depends on many factors. Typically, the process takes between several weeks and several months. Some of the major deciding factors include:
- The value of the estate;
- The complexity of the estate (how many creditors and beneficiaries, how many different types of assets, etc.);
- Whether the beneficiaries dispute the distribution of assets; and
- Whether the Will is in dispute.
An experienced estate lawyer can help you expedite the probate process.
How much does probate in Arizona cost?
Probate in Arizona can cost thousands of dollars, and the larger your estate is, the more it is likely to cost. Probate costs vary by state, so remember this cost differential if the decedent’s property (particularly real estate) is located in different states. Probate costs include:
- Filing fees;
- Executor compensation;
- Creditor notice fees;
- Probate bonds; and
- Attorney fees.
In most cases, the estate itself pays these costs. Total fees range from 3% to 8% of the total value of the estate.
Do all estates go through the probate process?
No. In fact, a very high percentage of estates never go through probate. This is because an estate planning lawyer can set up an estate so that it is not subject to probate. This can save you a lot of trouble down the road. There is a very simplified probate procedure for small estates with less than $75,000 and real property under $100,000.
How can I avoid probate in Arizona?
There is more than one way to avoid probate. Some of the tools you need to avoid probate include:
- Create a living trust and transfer your assets into the trust.
- Keep your money in retirement accounts with named beneficiaries.
- Keep your cash in payable-on-death accounts or joint bank accounts.
- Hold property in joint tenancy.
- Hold your property with your spouse as community property with the right of survivorship.
When you die, these assets will go directly to your beneficiaries or your survivor with no need to probate.
How long do you have to file probate after death in Arizona?
Under Arizona Code 14-3108, you must file for probate within two years of the person’s death. Be careful, however, because there are a few exceptions to this deadline. Consult with your lawyer if you have any questions.
How We Can Help
If you’d like to avoid the probate process, then contact our estate planning attorneys to help create a customized estate plan for you.
However, if your loved one has passed away and they did not have an estate plan and now you and the family are facing the confusing probate process, we may be able to still help. Call our offices and book your Probate Consultation to see how we can help you navigate this for you.
Estate planning could be critical to the financial futures of your loved ones. You shouldn’t wait until you are terminally ill to begin the estate planning process. Call the Law Office of Brandon White at 602-237-6772 or contact us online to schedule a consultation where we can discuss your options.