The process of administering and settling an estate after one person dies is known as probate. The specific probate procedure varies from state to state, in Arkansas it generally comprises the following actions:
1. File the Will and Petition
With or without a will, someone must request permission from the probate court to be appointed as an “administrator” of the decedent’s, (person who died) estate. The person appointed is known as the executor or personal representative.
2. Collect Assets
After being appointed and gathering all of the decedent’s assets, you must file a list, known as an “inventory,” with the probate court. You must also notify the decedent’s heirs and creditors.
3. Pay Bills and Taxes
A federal estate tax return is generally needed if the estate exceeds $1 million. This tax return must be filed within nine months of the date of death, if applicable. Heavy fines and interest rates may apply if you fail to meet this deadline, and the estate is taxable. If you don’t have all the information by the deadline, you can file for an extension and pay your best estimate of the funds owed.
4. File Income Tax Returns
Arkansas does not currently have an estate tax, but a federal income tax return may be required for the estate if it holds any assets and earns interest or dividends. If the estate does earn income during administration, it will need a tax ID number to account for all earnings.
5. Distribute Property to Heirs and Legatees
Generally, executors do not pay out all of the estate assets until the period runs out for creditors to make claims, which can be a year or more after the date of death. Once the executor the received court approval to address the claims, they can distribute most of the assets, and prepare for closing out the estate.
6. File a Final Account
The executor must provide the probate court with an in-depth account of any income the estate has received since the date of death and all expenses and distributions. Once the court has approved this final account, the executor may distribute whatever is left in the closing reserve and conclude their duties.
If you are responsible for wrapping up an estate, please know that you are not alone. The probate process can be daunting, but with the help of an experienced attorney, it doesn’t have to be. Please fill out the form below to start a conversation about what needs to happen next. We’ll do everything in our power to help make this difficult time a little bit easier for you.