Colorado Probate 101
For some people, the idea of “probate” conjures up images of a warring family or a Dickensian court fraught with traps and procedures seemingly designed to drain estates of assets. The reality is that probate is simply a court-based process after a person’s death to collect his or her assets, pay off any debts, and distribute what remains to the person’s heirs or devisees. The process itself is administrative in nature. While heirs and devisees can contest the will or the actions of a fiduciary, which transform the proceeding from administrative to combative or adversarial, when there is nothing to dispute, the process can (and often does) proceed with very little court involvement.
In Colorado, a probate case must be opened when a deceased person owned real estate or more than $88,000 in probate assets (adjusted annually) in his or her individual name. Probate assets are assets owned in the individual’s name and which did not have a joint owner or beneficiary designation. Assets owned in a trust are not owned in the individual’s name, and therefore would also not be counted as a probate asset. If there is no real estate and the person owned less than $88,000 in probate assets, then the estate may qualify for collection by affidavit, which avoids opening a probate case.
If probate does need to be opened, then the court is responsible for appointing a personal representative and can do so informally or formally. The personal representative is then responsible for gathering assets, giving notice to interested people, addressing creditor claims, paying expenses, and distributing the remaining property to the proper beneficiaries or heirs. The personal representative can take all of these actions without the oversight or intervention of the court. The personal representative is, however, a fiduciary and has legal duties to act in the best interests of the beneficiaries and should keep careful records (the nature of a fiduciary’s duties is a significant subject on its own!).
Depending on the assets that need to be probated, the process can take as few as six (6) months. It is not uncommon, however, for probates to be open for 9-18 months. Personal representatives then have the option to formally close the estate, informally close, or allow the court to administratively close the estate after 3 years of inactivity. In an uncontested case, this is only the second time the court is involved, having previously appointed the personal representative.
In sum, these rules apply should someone die without making other plans: many of these rules and procedures can be avoided with a properly designed and executed estate plan.
