Natalia Vander Laan
Filing an account is a crucial step in the probate administration of a deceased person’s estate. This process ensures that the personal representative properly manages and distributes the estate’s assets according to the deceased person’s wishes and the state laws. Proper accounting is vital for transparency, accountability, and legal compliance.
Probate accounting provides a detailed record of how the estate’s assets are being managed. The account includes identifying and valuing assets, recording income received by the estate, tracking expenses and paid debts, as well as documenting distributions to beneficiaries.
This transparency is intended to protect the personal representative from potential disagreements and ensures that the beneficiaries receive their due inheritance.
The first step involves the inventory and appraisal of assets. The personal representative should create a comprehensive list of the decedent’s assets, including real estate, personal property, bank accounts, investment accounts, retirement accounts, stocks, and any other valuable items. Next, the personal representative should obtain appraisals for non-cash assets to determine their fair market value at the time of the decedent’s death. Finally, the personal representative should file an Inventory with the probate court accounting for all the probate assets and their value.
The personal representative should maintain detailed records of all financial transactions throughout the probate process. The personal representative should record all income generated by the estate, such as interest, dividends, or rental income, and keep track of all expenses paid, such as funeral costs, taxes, or debts. The personal representative should retain receipts of all transactions.
The personal representative should open a bank account in the estate’s name using the EIN obtained for the estate. This will ensure that all the estate transactions are kept separate from personal finances. All financial transactions should be clearly designated and categorized to show their relationship to the probate estate.
The personal representative should prepare, file with the court, and mail to the interested parties the account of the probate estate. The account should include all the financial information required by the applicable statutes.
Typically, first, annual, and final accounts are required. In Nevada, the first account is due within 6 months from the appointment of personal representative by the court unless ordered sooner by the court. The final account is due once all the assets and debts are addressed. The court may waive the requirement of account if all interested persons, such as heirs or beneficiaries of the probate estate, consent in writing.
The account is subject to court approval. If the court finds it complete and accurate, it will approve the accounting.
Any interested person has the right to review the account and raise questions or objections if they believe there are discrepancies or mismanagement.
Keeping detailed and ordered records from the beginning of the probate process along with understanding legal requirements and regularly communicating with the interested parties throughout the probate process can ensure that the account is accurate and sufficient when it is due and can minimize the risk of disputes and misunderstandings. Consequently, using an accounting software or professional services may be necessary.
Filing an account in probate is a crucial aspect of estate administration, ensuring that the personal representative manages the decedent’s assets responsibly and transparently.
Natalia Vander Laan is a Minden attorney.
