What is Considered a Small Estate in Michigan?
When a person dies, the property they leave behind must be distributed to their beneficiaries. The law dictates the correct procedures to follow through probate administration. There are provisions for large and small estates alike.
If the decedent’s estate doesn’t have much property, it is considered a small estate, depending on its value. The dollar limit can change annually, with the value being $27,000 or less as of 2023, compared to 2022, when small estates were valued at $25,000 or less. Kendal Law Group, Bloomfield Hills business and estate planning lawyers explain how to handle a small estate.
Small Estate Processes in Michigan
When a decedent’s estate is small enough, various processes can be used to distribute it as follows:
Petition and Order for Assignment
The law allows a small estate to be handled using an expedited process. In this case, there’s no need to appoint a personal representative or take a notice of will, resulting in a court order to assign assets. This method is applicable if the balance of the gross estate after the funeral and burial expenses payment doesn’t exceed the cost-of-living adjustment.
The estate’s contents may be distributed to the beneficiaries using the Petition and Order for Assignment (PC 556). A description and value of all the property within the decedent’s estate must be availed. Any mortgages, encumbrances, or liens on real estate can be used to reduce the property’s value.
Filing the Petition
With the help of small estate planning attorneys in Bloomfield Hills, you can file the petition by submitting the following documents:
- Petition and Order for Assignment
- Death Certificate
- Will, if the decedent had one
- Funeral and burial bills
- A filing, certification, and inventory fee, depending on the value of the assets
Working with skilled lawyers can help ensure you capture all the necessary details in the petition, such as the decedent’s bank accounts, stocks, shares, and bonds.
Transfer by Affidavit
A small estate that doesn’t include real property can qualify for transfer by affidavit. The affidavit eliminates the need for court involvement. The person who completes the affidavit may receive the property after providing the decedent’s Certificate of Death and affidavit to the institution or individual who owns the property.
Before you can start the affidavit process, you must be an heir entitled to the property and know the following:
- The property the decedent owned
- The decedent’s other heirs
- Names and addresses of other heirs entitled to receive the property
However, you may not use the affidavit process if the probate court has appointed a personal representative. In addition, some financial institutions will not accept a transfer of assets via the affidavit process. Consult skilled small estate planning lawyers in Bloomfield Hills to help you evaluate your options.
Money Due from an Employer
Another small estate process entails receiving money due from the decedent’s employer. If you use the Affidavit Process or Assignment of Property process and the decedent’s employer owes them money or benefits, you should receive the money when you present a certified copy of the Certificate of Death and the Order for Assignment or Affidavit.
You don’t need a court order to claim wages or benefits from the decedent’s employer. Check with the employer if they have a contract or plan stipulating how and to whom employer wages should be distributed upon death.
Transferring a Vehicle
Michigan’s fourth small estate probate process entails transferring the decedent’s vehicle, which can be done using a form from the Secretary of State. You can use the process under the following conditions:
- The estate is not being distributed through the probate court
- The car to be transferred is worth less than $60,0
- There’s no lien to the car, or it can be paid in full at the time of transfer
The beneficiary must complete a certification from the heir to a vehicle form. You also must present a certified copy of the vehicle’s title and Certificate of Death. One or more heirs may have equal rights to the car, and those who wish to give up their rights must sign a form stating they have given up the interest.
You must pay use tax if you’re not a spouse or heir to the decedent, and the vehicle is transferred to you. Consult experienced Bloomfield Hills small estate attorneys on how to proceed in this case.
Who Inherits a Small Estate in Michigan?
After deducting the funeral and burial expenses, whatever remains is divided among the heirs. The inheritance formula determines who inherits what and how much of it. In the case of a small estate with a surviving spouse, they inherit all the property. If there is no surviving spouse:
- The property will be given or paid out to direct descendants of the decedent, starting with the children.
- The decedent’s grandchildren will split the share equally if a decedent’s child died before the decedent.
- If the decedent had a grandchild who should inherit, but they die before the decedent without children, the line of inheritance ends. The remaining descendants share the property equally.
- If the decedent has no surviving descendant, the property is split between the decedent’s surviving parents or siblings if the parents are not alive.
Small estate planning lawyers in Bloomfield Hills can provide more insights into the inheritance line depending on your case circumstances.
An Experienced Estate Planning Attorney Helping You Handle a Small Estate
There are various ways of administering an estate after the owner dies, and the rules vary depending on the value and size of the estate. Small estates with a value of $27,000 or less can be administered through four methods. The processes can be complex if you don’t understand Michigan laws, but Bloomfield Hills business and estate planning lawyers can help.
Kendal Law Group P.C. has skilled and knowledgeable estate planning attorneys who can guide you in distributing your loved one’s small estate. We understand how difficult this moment is for you after losing your loved one, and we want to provide you with the support you need as you mourn your loved one. Call us at 248-609-1718 to schedule a FREE case assessment.