How Probate Works in Nevada
Probate is the official way that an estate gets settled under the supervision of the court. A person, usually a surviving spouse or an adult child, is appointed by the court if there is no Will, or nominated by the deceased person’s Will. Once appointed, this person, called an executor or Personal Representative, has the legal authority to gather and value the assets owned by the estate, to pay bills and taxes, and, ultimately, to distribute the assets to the heirs or beneficiaries.
The purpose of probate is to prevent fraud after someone’s death. Imagine everyone stealing the castle after the Lord dies. It’s a way to freeze the estate until a judge determines that the Will is valid, that all the relevant people have been notified, that all the property in the estate has been identified and appraised, that the creditors have been paid and that all the taxes have been paid. Once all of that’s been done, the court issues an Order distributing the property and the estate is closed.
Not all estates must go through probate though. First, if an estate falls below a certain threshold, it is considered a “small estate” and doesn’t require court supervision to be settled. Click here to find out Nevada’s small estate threshold and procedure.
Second, not all assets are subject to probate. Some kinds of assets transfer automatically at the death of an owner with no probate required. The most common kinds of assets that pass without probate are:
Joint Tenancy assets-when one joint tenant dies, the surviving joint tenant becomes the owner of the entire asset, without the need for a court order. This is called “right of survivorship.” For example, if a house is owned this way, “Jane Sage and John Sage, as joint tenants,” and Jane dies, John owns the entire house.
Tenancy by the Entirety or Community Property With Right of Survivorship-these are forms of property ownership that function like joint tenancy, in that the survivor owns the entire property at the death of the other tenant, but are only available to married couples.
Beneficiary Designations-retirement accounts and life insurance policies have named beneficiaries. Upon the death of the account or policy owner, these beneficiaries are entitled to the assets in the account or the proceeds of the policy.
Payable on Death Accounts/Transfer on Death Accounts-bank and brokerage accounts can have designated beneficiaries, too. The account owner can fill out forms to designate who should recieve the account assets after their death.
Third, if a dececent had created a Living Trust to hold his or her’s largest assets, than that estate, too, won’t go through probate, unless the assets left outside of the trust add up to more than Nevada’s small estate limit. That, in fact, is why that Living Trust was created, to avoid probate after the death of the trust’s Grantor.
But for estates in Nevada that exceed the small estate’s threshold, and for which there is either no Will, or a Will (but not a Living Trust), probate will be required before an estate can be tranferred to the decedent’s heirs or beneficiaries. In Nevada, estates with assets less than $200,000 can petition for a simplifed probate process called Summary Administration. Estates with assets that exceed $200,000 must use General Administration procedures.
The general procedure required to settle an estate via probate in Nevada is the following:
The Will must be filed in the county where the decedent lived.
The Will must be filed within 30 days of the death.
A Petition for Probate must be filed as well. This requests the appointment of an executor. If there is no Will, the Court will appoint someone to serve as the Personal Representative of the estate. Notice must be given to all heirs and beneficiaries, as required by the court.
Once the Peititon for Probate is filed, a notice must be published in a newspaper where the decedent lived. This is to notify potential creditors of the proceeding. Creditors have three months to make a claim.
The Court will issue “Letters Testamentary” to the executor/Personal Representative — this gives the executor legal authority to act on behalf of the estate.
An inventory of the estate’s assets must be filed with the court
Once all of the creditors and taxes have been paid, a Petition to close the probate must be filed with the court.
The Court will issue an Order, distributing the estate’s property to the beneficiaries.
The executor is entitled to statutory fees for their services based on the size of the estate, but since such fees are subject to income tax (which inheritances aren’t, unless Nevada has an inheritance tax), many executors forgo the fees.