Not all estates must be
probated. One way that probate may be avoided involves what are known as "small estates." In these cases, Minnesota law allows an heir or personal representative to collect property such as bank
accounts, vehicles, investment accounts, safe deposit boxes, and other estate
assets by use of an Affidavit for Collection of Personal Property.
The person attempting
to collect property must complete the affidavit certifying that he/she
is
legally entitled to the property, and must also provide a certified copy of
the
death certificate. The person brings the affidavit and death certificate
to the person or business who holds the property or owes money to the
decedent. If the decedent left a Will, the personal representative can
sign the certification stating the beneficiary is entitled to the
property.
There are some requirements
for using the affidavit:
- The total probate estate value must be under $75,000 (total value, minus debt).
- There is no real property in the probate estate, regardless of its value. If the decedent left real property and the total value of the estate is still under $75,000, the estate nevertheless must be probated.
- The property is listed only in the name of the decedent (i.e., no joint tenant or named beneficiary).
- Thirty days have passed since the death of the decedent.
- No jurisdiction has granted or is considering any application or petition for the appointment of a personal representative.
- You have legal standing to submit the affidavit, either by being named as a beneficiary in the decedent's Will; or if the decedent left no Will, you are entitled to the property under the law as a surviving descendant or are otherwise entitled to the property under the Probate Code.
Medical Assistance claims can be made against an estate by using the affidavit, but not when a request for appointment of a personal representative is pending.
While it's often an advantage to avoid probate, there are some disadvantages of small estate administration:
- An estate worth up to $75,000 is still significant. Without the probate court to oversee the administration, there is room for improper distribution, either by mistake or misappropriation. Drafting an affidavit is not always a good DIY project.
- A personal representative could unwittingly distribute property before creditors are paid off. With probate the court provides checks and balances and requires the PR to satisfy valid debts before any property can be distributed to beneficiaries.
- An unscrupulous or careless family member may take estate property without the knowledge or approval of the personal representative.
- It's not uncommon for financial planners or other non-attorneys to try to help by drafting affidavits on behalf of clients. A poorly-drafted affidavit can create more harm than good, not to mention that it may constitute the unauthorized practice of law. The drafting of an affidavit is best left in the hands of a licensed Minnesota attorney.