Oct 24, 2022
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Selling a car belonging to someone who is deceased can be tricky, in this post we outline how an executor will sell a car belonging to the deceased.
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Have you just been named an estate executor and don’t know where to get started? The estate settlement process may seem daunting, especially if it is your first time going through it. Ultimately, the goal of the estate executor is to honour the wishes of the deceased and ensure their will is validated and followed.
There are a number of common misconceptions that exist regarding the estate settlement process. First-time estate executors must often rely on expensive lawyers, estate accountants, and administrators in search of answers, racking up significant expenses. In many instances, however, there are a lot of items on the estate executors checklist that you can do yourself, saving both time and money. Being prepared as an executor is the first step to settling an estate properly.
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Clear Estate’s mission is to simplify the estate settlement process and make it more transparent. Our goal is to empower estate executors and offer them all the tools and knowledge they need to make the best decision for settling the estate properly. From submitting probate, to developing a clear inventory of all assets and liabilities, we are here to help.
Our automated platform simplifies the estate settlement process, providing estate executors a clear overview on the next steps. Grieving the loss of a loved one is not easy, that’s why we Clear Estate is here to walk you through every step of the estate settlement process, offering you and your family some much-needed closure.
Whether you are a first-time estate executor and are feeling overwhelmed, or are simply looking for a little help, Clear Estate is here to answer all your questions. Our dedicated team of estate administrators will be by your side from the first meeting until the very last asset is distributed and the estate is completely closed.
Settling an estate properly not only provides closure, but also peace of mind preventing any legal and tax complications down the line. Setting your loved one’s estate through Clear Estate will ensure the process is completely seamless and transparent. Here is our complete guide to estate settlement, including a brief explainer on the process, and the seven steps to settling an estate.
Before diving into each individual step of the estate settlement process, it is important to first understand what estate settlement entails. Essentially, the estate settlement process occurs immediately after a loved one passes away, leaving behind assets and debts. This process involves applying for probate, establishing an accurate overview of assets and liabilities, and distributing it accordingly to designated beneficiaries.
Probate refers to the process of validating the will in court and determining whether it is accepted as the last true testament of the deceased before passing. Indeed, the probate process is extremely important, but it can also be avoided. For example, setting up a trust, naming beneficiaries, and liquidating assets before your death are all great ways to bypass the probate process. That’s why the best estate settlement occurs by planning ahead.
Beneficiaries are entitled to assets left behind by the deceased, while estate executors are tasked with a plethora of responsibilities. In some cases, the beneficiary is also the estate executor.
The executor of the estate must ensure that all debts and taxes owed by the estate are completely paid down before closing the estate. This is a crucial step in the estate settlement process and precedes the distribution of assets. In cases where there is no valid will, the estate settlement process usually is dictated by the jurisdiction it operates in.
The national average for the estate settlement process is typically between 14 and 18 months, however, Clear Estate can reduce it to less than a year. It will ultimately come down to a variety of factors, including the complexity of the estate, the assets being distributed, and the jurisdiction.
Validating the will is the first step in the estate settlement process and ultimately guides how the estate will be divided. We recommend locating the will as quickly as possible once your loved one passes. In many instances, the executor of the estate is well aware of the location of the will beforehand, simplifying this step.
Executing the will is an extremely crucial step to the estate settlement process and essentially contains your loved one’s wishes regarding their funeral and other important affairs that need to be addressed after their death. Indeed, the will also outlines the deceased’s beneficiaries and what they’re entitled to. This makes the estate settlement process much easier, preventing confusion and beneficiary drama.
Our beneficiary portal also helps in this respect, eliminating potential disputes between estate executors and beneficiaries. Our portal offers a clear overview of all the assets in the estate and keeps a consolidated record of all the communications throughout the estate settlement process.
Submitting the will to the probate court will kickstart the estate settlement process, where it will then be authenticated. Once the probate court validates the will, the executor of the estate has the authority to act on the estate’s behalf and begin the estate settlement process. Simply put, the sooner the will is authenticated in the probate court, the faster the estate will be settled.
The will, however, can only be submitted to the probate court of the province or territory in which the estate holder passed away. In some cases, the probate court can be bypassed altogether by following a few simple steps.
If there is no valid will, the estate will be settled according to the jurisdiction of the deceased. In any case, Clear Estate will walk you through every step of the way, offering expert advice from start to finish. From submitting the will, to navigating the estate settlement process without one, we have you covered.
Being an estate executor also means being in constant communication with the deceased’s loved ones, family members, and of course, beneficiaries. The next step in the estate settlement process is notifying all relevant parties about the death of their loved one and managing expectations. The estate settlement process can take between 14 and 18 months, and beneficiaries should be aware of this timeline. Every estate is treated on an individual basis depending on the jurisdiction and complexity of assets, however, Clear Estate can reduce this timeline.
Once all concerned parties have been informed of the death, the executor of the estate must notify the relevant governing bodies. This can be done with an official pronouncement of death, which is a crucial document in the early stages of the estate settlement process. If the deceased passed away in a hospital, for example, the doctor or nurse present at the time will issue the executor of the estate this pronouncement and create the death certificate.
In addition, the estate executor must also get in contact with government officials to inform them of the death. This only applies if the deceased was receiving government benefits, which now must come to an end. Other considerations to make for the estate executors are any regular payees the deceased had. Whether it was a monthly gas, electricity, car or phone payment, these must also be stopped as soon as possible. Keep in mind that creditors and insurers must also be notified to cease their business relationship with the deceased. Otherwise, unnecessary payments may go through well after their time of death.
More importantly, personal retirement accounts such as IRAs, TFSAs, and RRSPs should also be dealt with in the early stages of the estate settlement process. Typically, the deceased has already named beneficiaries for these accounts, ensuring the transfer of ownership goes smoothly. Once their personal holdings have been dealt with, any financial institution that your loved one had an account with, be it a chequing, or investment account, should also be contacted.
Finally, it’s time to contact any subscription services the deceased may have had. This can include magazines, newspapers, and streaming services.
At this stage, the will has been submitted to the probate court and has been validated by the appropriate jurisdiction, giving the executor of the estate the green light to settle the estate. The next consideration to make, however, are the deceased’s assets. This includes their home, valuables, and possessions such as their car, laptop, phone, and any other important items. We recommend locking these possessions up at a safe location of the estate executor’s choosing to avoid any potential disputes or drama. This will also guarantee that the assets can be appropriately distributed when the time comes.
The deceased’s mail is another important part of the estate settlement process. Simply forward any mail for your loved one to your address and ensure you don’t miss out on any important letters or documents. The deceased’s mail contains sensitive personal information, including bank statements and accounts, and should be handled with the utmost care. Receiving their mail will also shed light on any institutions the deceased conducted business with that you may not have been previously aware of. If possible, liquidating assets or distributing possessions before death is a good option and will simplify the estate settlement process.
Funeral arrangements are usually discussed beforehand and in many cases, are clearly outlined in the deceased’s will. Honouring the deceased’s wishes is at the heart of this step and should be treated with great responsibility. If your loved one has already made their own arrangements and picked a specific funeral home, this step will be relatively easy and is simply a matter of coordinating with funeral directors.
If there is no specific plan in place, it is up to the executor of the estate to choose a funeral home and make arrangements accordingly. Typically, the deceased will have made their wishes clear beforehand, informing their loved ones on whether they wish to be buried or cremated, where the body or ashes will be laid to rest, as well as where they wish to have the memorial service held. If this is not the case, consulting with family members is a smart option, ensuring the deceased’s wishes are well represented.
Funeral arrangements also include planning other important details, including the eulogy, informing friends and distant family members of the memorial, as well as the itinerary. In most cases, funeral arrangements are made within a week of the death of your loved one, but can be extended depending on if there are family members that must travel longer distances.
With the probate process well underway, the next step is determining the value of the estate. This is done by submitting an inventory of all the deceased’s assets, which will then be independently evaluated. These assets can include but are not limited to, bank and investment accounts, insurance policies, real estate holdings, safety deposit boxes, and any personal possessions such as cars, electronics, jewelry, artwork, and heirlooms.
Many of these assets and their appropriate inheritors are usually stipulated in the will. However, in cases where the assets are not in the will, distribution to appropriate beneficiaries can become tricky and requires some detective work.
This step of the estate settlement process can prove to be an emotionally exhausting one, especially if beneficiaries are applying pressure. Clear Estate understands this challenge, and is here to help. Our inventory service helps track assets and liabilities in real time, offering a convenient overview to executors and beneficiaries alike. In addition, our platform gives you access to a wide range of estate professionals and administrators, armed with the experience necessary to safely navigate through even the most complex estates. Once the inventory of assets is completed, it will then be submitted to the probate court for further review.
Two things are certain in life: Death and taxes. An estate executor is tasked with dealing with paying down all relevant taxes before officially closing the estate. This includes filing any outstanding tax returns the deceased may have had as well as dealing with the estate tax rate. Indeed, this rate fluctuates depending on jurisdiction.
In addition, the executor of the estate must also remember to file an estate income tax return if any assets earn income during the probate period. This typically applies to investments and should be closely monitored.
Finally, there are also probate taxes that exist in certain states, provinces and territories. In all Canadian provinces except Québec, a tax must be paid to the provincial government when the estate executor applies for probate. Typically, the tax is calculated based on the value of the estate.
For example, in Ontario, probate costs $15 for every $1,000 of an asset’s value over $50,000. For reference, the calculation is slightly different in California, where probate courts charge 4% of the first $100,000 of the estate. Alternatively, states such as Arizona’s Maricopa County, charge between $266 to $320 for court filing fees. These numbers should offer a quick insight into the types of fees the executor of the estate should be expecting. In any case, our estate experts are here to help and offer a better understanding of your probate fees depending on the jurisdiction of the estate.
With the probate fees and outstanding taxes paid, the final step in the estate settlement process, naturally, is closing the estate. The estate executor can now petition the court to distribute the remaining assets to beneficiaries and begin settling the estate once and for all. The probate court, however, requests a detailed list of every financial transaction that has taken place on behalf of the estate throughout the probate process. Clear Estate’s automated platform helps in this respect, keeping a comprehensive record of all transactions, including taxes paid, and any running costs incurred throughout the estate settlement process.
Managing beneficiary expectations is an important responsibility for estate executors in this step, ensuring they don’t feel left out of the loop. The executor of the estate may encounter obstacles throughout the estate settlement process and should be ready to clearly communicate these to beneficiaries. Beneficiaries will appreciate the transparency, simplifying the settlement of the estate. This can prove tricky, especially in cases where there are multiple beneficiaries.
In any case, our beneficiary portal provides complete transparency and a detailed timeline for the distribution of assets. Our portal helps them view the progress of the estate settlement process and gives them a clear view of what they can expect to inherit when the time comes.
This eliminates confusion, builds in an overall difficult process, and offers beneficiaries peace of mind. After all, probate proceedings can take several months to a year, and could potentially cause friction with over-eager beneficiaries.
Once the assets are distributed, the estate can be officially closed. ClearEstate is nonetheless here to support estate executors every step of the way and will guarantee the estate is closed properly, avoiding legal and tax implications down the line.
We understand that the estate settlement process can seem daunting, especially while grieving the loss of a loved one. You can always book a free consultation with Clear Estate or visit our blog before embarking on this process to arm yourself with all the knowledge you need to settle the estate efficiently and affordably. Ultimately, we’re here to speed up the process, saving you time, money, and most importantly, offering closure throughout a difficult time for your family.
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