Ancillary Probate: Owning Property in Several States

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 What Is Probate?

A person who owns any significant amount of property should consider creating a “last will and testament” document before they pass away. That document in particular helps ensure that the people whom they wish to inherit the property receive it. Otherwise, if a person dies without a will, i.e., intestate in legal terminology, then the probate courts distribute their property in accordance with the relevant state’s laws of intestate succession.

Before the estate of a deceased person can be distributed, however, the law requires confirmation that the will was created in a way that makes it valid and legally enforceable. For this purpose, a will must go through what is known as the “probate.”

After the testator, i.e., a person who prepares a will passes away, the probate process is used to manage the estate of the testator, including such issues as the following:

  • Determining whether the will was properly drafted, signed, and witnessed.
  • Ensuring that the taxes and debts owed by the estate are identified and paid off in full.
  • Identifying all of the property of the decedent.
  • Distributing property and or assets to the beneficiaries who are entitled to receive it.
  • Resolving any conflicts between interested parties, e.g., heirs, beneficiaries, and those who may have been intentionally left out of the will or excluded, etc.

Where Does the Probate Process Take Place?

Generally speaking, the process known as “probate” is started in the county’s probate court in which the deceased person had their permanent residence or their “domicile.” After a petition for probate is filed, the probate court in that county becomes the primary probate court for overseeing all related matters, including personal property, bank accounts, and other assets.

However, if the deceased owns real property, such as a plot of land or a house in a different state, that property must go through probate in the court where it is located.

Ancillary probate may also be necessary for property other than real property, e.g., such items as a car or boat that is registered and titled in another state. The livestock, oil, gas, or mineral rights attached to an out-of-state property may necessitate an ancillary probate. Again, the distribution of the property would be governed by the law of the state in which it is located, rather than the law of the state where its owner resides.

What Is Ancillary Probate?

Ancillary probate is a supplemental probate proceeding that starts after the initial probate proceeding has begun in the domiciliary state of the decedent. Again, an ancillary probate is necessary if a decedent owns property where they do not normally reside, e.g., a vacation home in a state where the decedent was not a full-time resident.

Ancillary probate takes place in the state where the additional property is situated. If there is an ancillary probate proceeding, the main probate is referred to as the “domiciliary probate” because it takes place where the decedent was domiciled.

Suppose the deceased permanently lives in a house located in Delaware but owns a vacation home near a ski resort in the state of Vermont. In that case, the vacation home must be distributed to the beneficiaries in accordance with any valid will and the applicable laws of Vermont.

As noted above, ancillary probate is required for secondary real property holdings for the same reasons that regular probate exists. Probate is required to clear the title to the property and pay any debts and taxes owed to creditors before the property can be distributed to heirs or acquired by the named beneficiaries.

What Are the Requirements for Ancillary Probate?

In some states, the executor of an estate can file their executor authorization from the probate court in the first state and a copy of the will, if there is one, in the probate court of the ancillary probate. They would do this instead of petitioning the second court for authorization.

In some places, the executor’s authorization is referred to as their “letters.” If the executor is able to avoid starting a new ancillary probate, they are often known as a “foreign executor.”

Generally, a second court accepts a will that has already been accepted by the first court. It would not require that the executor present evidence of the will’s validity. The court of the ancillary probate then refers to the will that was accepted by the domiciliary state as a “foreign will.”

There is no benefit to ancillary probate proceedings. An executor would need to pay additional court costs and attorneys’ fees. However, sometimes ancillary probate cannot be avoided if a decedent left certain property in another state that must pass through probate before it can be distributed.

How Can I Avoid Ancillary Probate?

Most people would prefer to avoid probate as there are costs associated with it, and it can be time-consuming. Like the standard probate process, ancillary probate can be avoided in many of the same ways.

One way to avoid ancillary probate for property located in another state is by holding the property in a joint tenancy arrangement with another person. If one of the owners dies, the other owner automatically becomes the owner of the other joint tenant’s interest in the property. Thus, an ancillary probate proceeding would not be necessary because one owner would have become the owner of the property in a perfectly legal manner.

Another way to avoid ancillary probate is by placing any property that is situated in other states into a revocable living trust. This type of trust must be set up while the owner of the property is still alive. The property owner appoints a trustee to oversee the trust.

The trustee also becomes the person responsible for distributing the trust property to the proper beneficiaries according to the provisions in the trust document. Thus, instead of going through the ancillary probate process, the property simply passes to the beneficiaries outside of probate and in accordance with the directions set forth by the provisions of the trust agreement.

Yet another option is to use a “transfer on death deed.” A death deed is a type of deed that permits a real property owner to transfer property to an assigned beneficiary at their death and without the need for the probate process. However, it is important to note that transfer on death deeds is not accepted in every state.

Do I Need a Lawyer for Help With My Ancillary Probate Issue?

It is essential to make sure that your property is distributed in the way that you intend upon your passing. Undoubtedly, you would also like this to be done in a timely manner.

Therefore, if you own property in one or more states, you want to consult a local probate lawyer for further assistance. An experienced estate lawyer can aid you in drafting a will and taking other measures that are necessary to help avoid ancillary probate if that is your wish.

If a person has already passed away and left property in more than one state, then an estate lawyer can help initiate an ancillary probate or take whatever other steps are needed to deal with the issue.

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