Sign Maryland Banking Living Will Online

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Hi, my name is Frank Gray. I'm an attorney with Chesapeake Wills and Trusts. We're going to talk about everything you need to know about the Maryland probate process in seven minutes or less. If you're watching on YouTube, make sure to like this video, if you enjoyed the content, make sure to subscribe to the channel, hit the notification bell. So you're informed when we push more content, your way that'll help you with your estate planning needs. First of all we got to talk about. What is probate? Probate is the court supervised process of validating a will, paying off valid debts and distributing property. At its essence, that's it. Now it's much more complicated than that. And before we get into the actual process, we got to define a couple of things to make sure we're speaking the same language. First of all, we have to define what is a probate asset and that's as opposed to a non-probate asset, a probate asset is an asset titled in the name of the decedent alone when they died. Here's the classic example. Mom had a bank account in just her name or dad had a house in just his name. Now the opposite of that is a non probate asset. A non-probate asset is an asset not titled in the name of the decedent at the time of their death, but that the decedent had control over at the time of their death. Let me give you a couple of examples. I might have a 401k in my name, but I have a beneficiary designated. So although I own it during my lifetime, the second I die, it goes to whoever I've designated as my beneficiary. It could also be a life insurance policy or a POD account payable on death. In other words, in the first example I used of a probate asset: mom had a bank account and just her name. Well, what if mom had a bank account in her name that had a POD mean payable on death or TOD transfer on death to one of her kids. Now it becomes a non-probate asset because as soon as she passes away, The bank is instructed to give it to whoever she's designated as her beneficiary. All right. So now why do these definitions matter matters for two reasons? Reason number one is that probate assets go through probate non-probate assets. Guess what? It doesn't go through probate. It also matters a little later when I explained the process. Probate assets plus non-probate assets equals what's called the gross estate, which is going to matter for a couple of different reasons at the end. All right. So let's talk about the process of Maryland probate. This only applies to the state of Maryland. Every state law is different. Louisiana probate is going to be a lot different than Maryland probate. Louisiana probate is going to be different than California probate, California probate is going to be different than Maryland probate. Every state is individualistic. I want you to think of probate in Maryland in three simple phases: opening the estate, the administrative phase and the distributions phase. First of all, opening the estate. Remember we have another video where I explained to you what to bring with you, the paperwork that you're going to need in order to open the estate, make sure to watch that video, I'll have a link down below so that you can see it. So you know exactly what to bring with you. When you go in to open an estate, you can expect it's probably going to take an hour and a half give or take, depending on how busy the register of wills is. So let's talk about opening the estate. That first stage I talked about. You're going to fill out some paperwork in order to open the estate. You're going to establish who the personal representative is going to be. Hopefully there's a, will that names you as the personal representative, if there's not, then that's going to be a separate problem that we're going to address because it can become pretty complex. But what you need to know is if there's not a will. There a preference in the law, the law already sets who the personal representatives can be. And basically it gives preferences to spouse and kids after we've established who the personal representative is going to be. The probate court is actually going to give the personal representative letters of administration. That's the court order that allows them to go do what they have to do after you have the letters of administration. And it can move on to the second phase. You're going to do the administrative stuff. You're going to end up identifying and valuing assets. You're going to end up using your letters of administration after you identify bank accounts, to transition them into a state account. In other words, bank accounts in the name of the estate of the decedent, you're going to unlock those bank accounts. That's going to be important because you need to use that money in order to continue to preserve the asset, to make insurance payments, to make mortgage payments, things like that in the administrative phase, we're also going to notify creditors that can happen either through a general notice. Or by notifying specific creditors with specific paperwork and along the way, we're going to pay valid claims. There may be funeral expenses. There may be other claims that are valid, but remember, we're only going to pay valid claims. Not everyone who comes knocking on the door has a valid claim. During the administrative phase, we're also going to pay fees and taxes. Those are two different things. There's a fee chart, and we're going to have a link down below that you can click on. And it depends on the value of the gross estate. Remember when I define those terms early on. Probate assets, plus non-probate assets, everything that the decedent owned at the time of their death, whether it's going through probate or not makes up the gross estate based on the value of the gross estate, there's going to be a fee that's going to be paid to the register or wills. The probate fee. We're also going to have to take care of some taxes. There's going to be a possible inheritance tax. An inheritance tax is a state tax of 10% based on the relationship of the person who inherited the property. You may or may not have to pay an inheritance tax. If you're a next door neighbor and you inherit property, you're going to pay an inheritance tax. If you leave property to your kids, your kids aren't going to have to pay an inheritance tax because of their relationship to you. We're also going to have to deal with the state taxes that happens on both the state and the federal level two different taxes. The state taxes paid to the controller of the treasury. The federal taxes paid to the IRS. Finally, at the end, we're going to get to the third phase. That's the ultimate distributions we're going to distribute. What's left the will, is going to tell us who gets what, when and how they get it. If there's not a will, that's called dying intestate and the government has a provision about who's going to get what it really depends on whether or not you're married, whether or not you have kids who your heirs are. If you were to come in right now and tell me who your heirs are, I would say. Great who your air is going to be when you pass away, because that's the important question. And you don't know that until you pass away. I want you to click down below to get a copy of our different guides we have available. We have a probate guide that's available if you're watching this, because you're thinking about avoiding probate. You may want to click on our book where you can learn more advanced the state planning techniques to avoid probate. Thanks for watching.