1. What happens, legally, when someone dies?
The handling of a deceased person's estate is called estate administration.
2. What is an estate administration?
Upon the death of an individual, decisions involving the decedent's burial arrangements and the disposition of his or her property must be made by someone. Usually, such decisions are made by family members. If the decedent had a valid Last Will and Testament (the Will), that document normally names the person(s) who will handle the decedent's affairs. If the decedent died without a Will, the law directs who can handle the estate and who will receive the decedent's property.
Contrary to popular belief, where there is no Will, the state will not receive the decedent's property unless there are essentially no living relatives who can be located. Whoever is designated by the decedent's Will, or an appropriate individual, in the case of intestacy (death without a will), may handle the decedent's estate, but only after the individual(s) is appointed by the Court and given proper legal authority to do so.
Who should be appointed to manage a decedent's estate, how to do so, who will inherit the decedent's assets, and what steps are required to properly administer an estate are all legal questions that should be explored with an attorney who is very knowledgeable in such matters. James M. Boyd, at the Law Offices of Boyd & Boyd, P.C. will be glad to discuss these questions with you and will do so preliminarily without charge, to guide you in answering these important questions.
3. How are fees charged for the handling of estates?
There are several ways fees may be charged for the administration of an estate. Whoever serves as executor (one who is appointed in the decedent's Last Will and Testament) or administrator (where there is no last will and testament) is entitled to a fee for handling the estate. That fee is generally in the range of four (4%) to five (5%) percent of the gross value of the estate.
The proper administration of an estate is a complex matter. It involves decisions such as locating and notifying the proper heirs of the estate, properly locating, liquidating, and handling the assets of the estate, reporting to the heirs and the Commissioner of Accounts, the filing of appropriate state and federal tax returns, and the resolution of any claims or disputes which may arise involving the decedent's estate. Importantly, the executor/administrator serves in a fiduciary capacity in administering the estate. This means that the individual who assumes this responsibility may have personal liability if the estate is not properly handled. For these reasons, it is advisable to seek expert legal advice to ensure that the executor/administrator becomes knowledgeable about the many legal requirements of an estate administration.
At our firm, the law offices of Boyd & Boyd, P.C., we provide guidance to executors and administrators for which we charge a fee on an hourly basis. Typically, the executor/administrator will meet with us for one to two hours to review the estate assets and the particulars of how to administer the estate. Following that consultation, we will stand by ready to answer any questions that may arise.
Alternatively, at times, the decedent, in his or her Last Will and Testament, or the decedent's family members, will decide to ask us to serve as the executor or administrator of the estate. In these instances, typically, legal fees are not charged. Our fee would be paid as part of the fee a non-professional would receive, generally, a fee of four (4%) to five (5%) percent of the gross value of the estate is considered a reasonable fee for seeing the estate through a complete administration.
For larger estates, exceeding $500,000 in value, the percentage charged on the value of the estate for its administration is reduced according to guidelines determined by the Virginia State Supreme Court. Should you desire, we will be pleased to discuss the details of the applicable fee schedule for the administration of any size estate with you.
4. Avoiding Probate
With proper estate planning, in advance, individuals and families can structure their estate so that probate of the estate through the Court, along with the complexities, expense, and delays associated with that process can be eliminated. By setting up a Trust during an individual’s lifetime, when the time comes to administer the estate, the assets of the decedent can be administered by a Trustee of the decedent’s choosing. The administration of the estate can be handled without resorting to the Court, without the estate incurring probate fees, and at a reduced fee for the administration services provided to the estate. We will be pleased to discuss that process with you, should you desire.