When someone passes away in Iowa, their estate may or may not need to go through probate, depending on different factors. Probate is a process that allows for the transfer of an estate to the deceased’s heirs or beneficiaries. The probate process includes a mandatory four-month period to allow time for creditors to file claims against the estate, meaning heirs and beneficiaries will not receive their shares of the estate immediately. As a result, many people attempt to avoid probate altogether. One of the main factors determining whether your estate must go through probate is the value of your assets at your death.
Probate Value Requirements
Probate administration is the process of identifying assets, paying debts, and distributing the remaining assets to the appropriate heirs/beneficiaries. For example, an estate with a value of more than $50,000 must go through probate to distribute assets. Additionally, if the deceased had real property in Iowa and the property wasn’t owned in joint tenancy, their estate must go through probate.
In Iowa, not all assets are used to calculate the value of an estate. When determining an estate’s value, life insurance policies and retirement accounts not distributed to the estate are not part of the valuation of probate assets.
Additionally, jointly owned assets will not go through the probate process. This is because those assets automatically transfer to the other owner. So, for example, if you own property as a joint tenancy with another person, that property is not considered a probate asset.
When you have assets that do not qualify as probate assets, it can lower your estate value and help avoid probate. On the other hand, if your estate must still go through probate, the non-probate assets will not go through that process. As a result, any non-probate assets can transfer to the named beneficiary immediately rather than waiting for probate.
What Happens if Your Estate Is Under the Probate Threshold?
If your estate is under the probate threshold, Iowa law allows the distribution of your assets using a small estate affidavit. This affidavit is usually used by heirs and beneficiaries to claim their inheritance without going through the probate process. This affidavit cannot be utilized until 40 days have passed from the date of death. For the affidavit to be valid, it must be paired with a copy of the death certificate and include certain information, which includes:
- A general description of the assets to be transferred
- The heir’s and beneficiary’s names and addresses
- An affirmation that no other individuals have a right to the property described in the affidavit
Contact the Probate and Estate Planning Attorneys of Telpner Peterson Law Firm, LLP Today
If you are considering estate planning to avoid probate, the attorneys of Telpner Peterson Law Firm, LLP are ready to help. With our experience, we can review your situation and create an estate plan that meets your needs. Our probate attorneys can help if you have an estate that requires distribution.
For a confidential consultation, contact us at 712-309-3738.