A small estate affidavit is a sworn legal document that may allow an estate to avoid going through probate. Small estate affidavits are permitted in many states, as long as the value of the estate is small enough. Using one can let an heir claim assets of the deceased in days or weeks instead of the months or years it can take for an estate to go through the probate process. Using a small estate affidavit also cost very little or even nothing, while the probate fees can eat up sizable portions of estate’s value.
A financial advisor can help you create an estate plan for your family’s needs and goals.
Small Estate Affidavit Basics
A small estate affidavit is a sworn legal document a person can use to assert a claim to assets from the estate of someone who has died. This can avoid the potentially lengthy and costly probate process. Generally, only family members such as spouses, children, parents, partners or named executors of an estate can use small estate affidavits.
Small estate affidavits are allowed in many but not all states, and rules vary widely. Different jurisdictions may also call them by different names, such as affidavits for collection of personal property or affidavits in lieu of administration.
Standards for small estate value represent one major area of difference. Some states consider an estate small enough for this process only if the value of its assets is less than $10,000. Others allow this streamlined method of administering with assets of hundreds of thousands of dollars.
Most states also require a waiting period after the death before the small estate affidavit can be employed. This varies but is typically about two months.
Another restriction on small estate affidavits is that probate cannot already have begun. Some states also allow small estate affidavits only if there is no will.
Only certain assets count toward setting an estate’s value. These are generally personal items, such as clothing and furniture, as well as bank and brokerage accounts. Assets exempt from probate, such as bank accounts or insurance policies with named beneficiaries, are not included in the small estate value calculation. Jointly owned assets are also left. Any debts owed by the estate are considered and will reduce the value of the estate.
The small estate affidavit normally does not need to be filed with the court. Instead, the affiant – the person who swears the affidavit is true and he or she is entitled to the assets – presents it to the bank, brokerage or other holder of the asset. If the asset holder approves it, the assets will be released to the affiant. A small estate affidavit may also be presented to a state agency, such as motor vehicle division.
There are usually few or no fees to pay when using a small estate affidavit. Court fees, if any, are usually nominal. A notary, often required to validate the signatures on the affidavit, typically costs $20 or less.
A small estate affidavit can be downloaded from the website of the county court where the death occurred. Financial institutions and state agencies such as motor vehicle departments also have them. Affiants can even create their own affidavits.
What Is Summary Administration?
Summary administration is a shortcut to the often lengthy and usually expensive process of administering an estate through probate. It is the form of estate settlement that uses small estate affidavits. Some states require that a petition to employ summary administration in settling an estate be submitted to the court before the small estate affidavit can be used.
Summary administration can be completed in a week or a month, rather than taking months or years as probate can. However, there is usually a waiting period that must be finished before summary administration can begin.
What’s Included in a Small Estate Affidavit?
Most people can fill out a small estate affidavit without an attorney’s help. The form usually needs to state the following:
- The value of the estate
- The completion of the required waiting period
- The affiant’s right to the assets
- That probate has not been initiated
Various attachments may also need to be included, such as:
- Bank statements, vehicle titles or other proof that the decedent owned the assets
- Details such as statements establishing the extent of any debts or claims against the estate
- Death certificate
- Identification papers such as a driver’s license or passport for the affiant
- Proof such as a will that the affiant is entitled to the assets
- A list of heirs such as offspring or spouses, with their signatures agreeing to the use of the small estate affidavit
The affidavit may also need to be notarized.
Pros of Small Estate Affidavit
Small estate affidavits offer some notable benefits, including:
- Reduced time to administer the estate
- Less cost compared to probate
Small estate affidavits can be very helpful when a person dies intestate, that is, without a will.
Con of Small Estate Affidavit
Small estate affidavits are not available in all states. Other limits and drawbacks include:
- The affidavit signer is agreeing to be personally liable for up to the estate’s value, in case a creditor demands payment of a debt.
- Small estate affidavits can’t be used to transfer real estate in most states.
Using a small estate affidavit can require some time and energy. For instance, the affiant is usually required to notify other heirs and interested parties, such as creditors, and get their consent to use the streamlined administration process.
Small estate affidavits can save time and money when administrating estates. They can only be used in some states, and only then when the size of the estate is below the statutory maximum. Small estate affidavits can’t be used for real estate transfers. Presenting a properly completed small estate affidavit to a bank or other asset holder can result in rapid transfer of assets to an heir’s control. However, someone who uses a small estate affidavit can also be exposed to increased liability for any debts owed by the state.
Estate Planning Tips
- A financial advisor can provide expert assistance with estate planning. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- For larger estates, a trust can be used to avoid having to go through probate. Setting up a trust requires forethought and some expense. However, assets placed in a trust go directly to the named beneficiaries without the delay and expense of probate.
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