As an estate planning attorney in Colorado, I’m often asked whether a probate case is necessary when someone passes away. The answer depends on the size of the estate and how the assets are titled. While probate isn’t always required, it is often necessary in specific circumstances. In this post, we’ll explore when you need to officially open a probate case in Colorado and provide examples to clarify common situations.
What is Probate?
Probate is the legal process of administering a person’s estate after their death. It involves proving the validity of a will (if one exists), appointing a personal representative, gathering and valuing assets, paying off debts and taxes, and distributing the remaining property to beneficiaries.
While the process can be time-consuming and stressful, it is necessary in some situations to ensure assets are properly transferred and that creditors and taxes are paid.
When is Probate Required in Colorado?
There are a few key situations when probate is required under Colorado law:
1. When the Estate is Large
In Colorado, estates valued over $80,000 (as of 2024) typically require probate. If the decedent owned property, such as a home or valuable personal items like cars, stocks, or business interests, and these assets are not held in a trust or have beneficiaries listed, probate will be necessary to legally transfer ownership.
Example: Jane passes away and owns a home in Denver valued at $600,000, as well as several investment accounts worth $100,000. Since her estate exceeds the $80,000 threshold and she did not place these assets in a trust or assign payable-on-death (POD) beneficiaries, her family will need to open probate to distribute these assets.
2. If There is No Will
If someone dies without a will (known as dying “intestate”), their estate will likely go through probate. The court will appoint a personal representative (also known as an executor) to manage the estate, pay debts, and distribute assets according to Colorado’s intestate succession laws. Without a will, the state determines how the estate is distributed, typically to surviving family members.
Example: Mark, a single father, passes away without a will. He has two adult children and no other close relatives. In this case, his estate will need to go through probate, and the court will appoint a personal representative to distribute his assets according to state law.
3. Real Estate is Involved
Real estate can trigger the need for probate, especially if the property is solely in the decedent’s name. If there is no co-owner or the property is not held in joint tenancy with right of survivorship, probate is necessary to transfer ownership to the heirs or beneficiaries.
Example: Sarah owned a cabin in Estes Park but did not include it in a trust. She intended for her son to inherit it, but without a trust or joint ownership, the son will need to open probate to legally transfer the property into his name.
4. Debts Must Be Settled
Probate is often required if the estate has outstanding debts that need to be settled. The probate process ensures creditors are notified and given the opportunity to make claims against the estate. If the decedent has unpaid medical bills, taxes, or other obligations, probate provides a structured process for handling these debts before distributing any remaining assets to beneficiaries.
Example: John dies leaving behind substantial credit card debt and an outstanding mortgage. His family may need to open probate to manage the debt payments and transfer any remaining property.
5. Disputes Over the Estate
If family members or heirs disagree on the terms of the will or how assets should be distributed, probate may be required to resolve disputes. The court will oversee the process, ensuring fairness and adherence to Colorado law.
Example: A decedent leaves behind a will that divides the estate equally between two children, but one child feels the other received preferential treatment. In this case, probate will likely be necessary to resolve the dispute through the legal system.
Can Probate Be Avoided?
Yes, probate can often be avoided with proper estate planning! One of the best ways to do this is by establishing a revocable living trust. When assets are transferred into a revocable trust during the grantor’s lifetime, they bypass probate because the trust owns the assets, not the individual. Additionally, by assigning beneficiaries to accounts and using joint ownership for property, you can avoid the need for probate altogether.
To avoid the time, stress, and expense of probate, it’s important to plan ahead. A properly funded revocable trust can keep your loved ones from needing to navigate the probate process and ensure your wishes are carried out smoothly. Contact us today to learn how we can help you create a customized estate plan designed to meet your unique needs!
If you have questions regarding estate planning, probate, or civil litigation contact Chapman Law, PLLC to discuss your situation.
This blog is intended to provide general information and, therefore, should not be treated as legal advice. You should contact a qualified attorney for questions about legal issues.
