The purpose of this outline is to provide an overview of concepts germane to the subject. None of the information contained herein should be relied upon as legal advice nor should it be relied upon to resolve an individual legal problem.

The probate court supervises the administration of decedent’s estates, including the payment of expenses, taxes and claims, and the distribution of the remaining assets to those who are legally entitled to receive them.  The following is an overview of the procedures to be followed in connection with the probate court and an executor’s or administrator’s duties regarding a decedent’s estate.

 

Wills and Codicils

 

Within thirty (30) days after a person’s death, an executor who has possession of a will or codicil must file the will and codicil, if any, for probate with the court of probate in the district where that person was domiciled at the time of death.  If another person has knowledge of the decedent’s will or codicil, they must deliver the will and codicil, if any, to the executor or to the court of probate in the district where the decedent was domiciled at the time of death, again, within thirty days after learning of the person’s death.

 

Responsibility of a Fiduciary

 

A person who is appointed an executor or an administrator of a decedent’s estate takes on the duties and responsibilities of a fiduciary.  A fiduciary is responsible for carrying out the intentions of the Testator or Testatrix and holds property in a position of trust for other persons.  The law charges the fiduciary with certain responsibilities in handling estate assets, and the fiduciary can be held personally liable if those assets are managed improperly.

 

Preservation of assets should be the fiduciary’s primary goal.  The fiduciary is under a duty of keeping personal affairs and fiduciary responsibilities separate.  This means that the fiduciary must not mingle estate funds with his or her personal funds and must never use estate funds for personal use. The fiduciary must act fairly and impartially in carrying out the terms of the will and should never favor one creditor or beneficiary over another.

 

The fiduciary is responsible for filing all documents necessary in connection with administration of the estate on a timely basis.

 

The fiduciary is under the continuing supervision of the court of probate.  This means that in certain situations the fiduciary must obtain authority from the court of probate to enter into a proposed transaction.  Even in situations where the fiduciary is not required to obtain court approval, the fiduciary may ask for permission from the court to act in order to protect himself or herself against potential liability.

 

Professional Assistance

 

It is often advisable for the fiduciary to obtain professional assistance in connection with the administration of an estate.  The clerk of the court or perhaps the judge of probate may provide limited assistance by helping a fiduciary to complete required forms and reports.  It is the fiduciary, however, who is primarily responsible for completing these forms and reports and for taking all other steps necessary to settle the estate.

 

Professional assistance should be obtained if circumstances of a decedent’s estate are such that extensive help may be required.  An example of such circumstances are as follows: (1) if there are unusual assets or circumstances in connection with the administration of the decedent’s estate, (2) if there is a significant likelihood that an interested party could object to the admission of the will or the administration of the estate assets,  (3) if the filing of Form 706, U.S. Federal Estate Tax Return is necessary, (4) various taxation problems exist, or (5) if the fiduciary is unable to understand the nature of his or her responsibilities.

 

If the fiduciary must be represented before the court of probate, an attorney authorized to practice law in Connecticut must be retained.  An attorney’s charge will be based upon time spent, the complexity of the work performed, and other criteria.  Attorney’s fees are subject to approval of the court of probate at the time of the hearing on the final account.

 

Procedures in the Administration of an Estate

 

Application for the probate of the decedent’s will and appointment of the executor named in the will should made to the court of probate within 30 days after a person’s death.  If the decedent died intestate (without a will), an application should be made for the appointment of an administrator.

 

After the application is filed, the court of probate may set a date for a hearing on the application or may “streamline” the procedure.  If the court determines a hearing is necessary, notice of the time and date of the hearing will then be given by the court of probate, by mail, to persons who are entitled to the decedent’s property under the laws of intestacy (the “heirs-at-law”), whether or not the decedent left a will, to give them the opportunity to raise objections to the admission of the will or appointment of the executor or administrator proposed in the application.  Under the streamline procedure, notice is sent to the heirs-at-law informing them that, unless a hearing s requested, the court will automatically approve the application.  If all persons entitled to notice waive notice of hearing by signing a waiver of notice, the court of probate may proceed with the appointment of the executor or administrator without any notice.

 

A person objecting to the will or to the proposed appointment of the executor or administrator should appear at the scheduled hearing, represented by an attorney, to state his or her objections.  The court will consider any objections raised, and if there is no successful objection raised and the court finds the will duly executed, it will admit the will to probate and approve the appointment of the executor, or if there is no will, appoint an administrator. 

 

When one or more of the decedent’s heirs or beneficiaries named in the will are minor(s) or are otherwise legally incapable, the court will appoint a guardian ad litem to represent such heirs and protect their interests.

 

Probate Bond

 

Once a fiduciary has been appointed, the court of probate will order that any necessary bond be posted.  In all instances in which a bond is required, there must be a surety on the bond.  The purpose of a bond is to provide a fund for the indemnity of the creditors and beneficiaries in the event that the fiduciary mishandles the property in the estate.  If the will directs that no bond is required of the executor, the court of probate will typically not require a bond.  The court may, however, require a bond if cause is shown or if an objection is filed.  The amount of the bond in such a case is usually equal to the estimated value of the liquid assets (i.e., cash, bank accounts, and investment assets) in the estate.

 

The fiduciary’s primary duty is to prudently manage and distribute the assets of the estate.  Bank books, securities and valuables should be kept in a safe place and adequate insurance should be maintained on the decedent’s real and personal property.  Upon appointment, the fiduciary should open a fiduciary checking account, and an accurate record should be kept of all financial transactions.  Estate income should be deposited in the account and all estate expenses should be paid from the account.

 

A fiduciary has the authority to convert the decedent’s personal property into cash.  However, probate court approval should be obtained for a private sale.  Probate Court approval should also be obtained to sell real property, to disburse money for the support of a spouse or family, to carry on the business of the decedent, or to compromise a claim against or in favor of the estate, where such authority is not authorized by will.  Upon receipt of an application for such approval, the court will schedule a hearing and, if approved, will issue an order authorizing the sale.

 

The fiduciary may not receive a benefit from any transaction nor may a family member of the fiduciary.  If any transaction appears questionable, probate court approval should be obtained.  The probate court should be notified promptly if the fiduciary is a “survivor” of a joint asset with the decedent.

 

Inventory

 

An Inventory of the estate should be filed with the court of probate within two months after appointment of the fiduciary.  The inventory should list all of the decedent’s assets which the decedent owned in his sole name, including all real property and tangible personal property situated in this state and intangible personal property located anywhere.  The inventory should also list life insurance policies payable to the decedent’s estate, any partnership property, and any property owned as a tenant in common. 

 

The inventory should not include property held jointly with right of survivorship, life insurance policies on the decedent payable to a named beneficiary, assets held in trust, or other property that does not pass either under the terms of a decedent’s will or under the laws of intestacy, such as individual retirement accounts, qualified retirement plans and tax deferred annuities.  Such property should not be included in the inventory because its disposition is controlled by the terms under which the property is held, rather than by the decedent’s will or the intestacy laws. 

 

The value of the property stated on the inventory should be its fair market value as of the date of death.  The fiduciary may determine its value from personal experience and inquiry.  If an expert appraiser is used, copies of all appraisals made by experts should be attached to the inventory.

 

Until the final account is approved, any interested party may file a written statement with the court listing objections to the acceptance of the inventory.  The court will then grant a hearing on the acceptance of the inventory, with notice given to the fiduciary and all interested parties.

 

If personal property in the estate is to be sold, in some cases, the fiduciary must file an inventory before selling the property out of the estate, and a copy of the inventory must be sent to each person interested in the estate.

 

Payment of Claims Against the Estate

 

Claims are obligations incurred by the decedent before death.  Within fourteen (14) days after the appointment of the fiduciary, the probate court will place a newspaper notice notifying persons having claims against the decedent to present their claims to the fiduciary whose name and address are shown in the notice.  A creditor has up to the lesser of: (1) the remaining limitation period otherwise applicable to his or her claim under the applicable limitation statutes if the decedent had not died; or (2) two years from the date of death of the decedent, to seek recovery of any claims against the decedent’s estate.  The fiduciary may send a certified mail notice to creditors of the estate, informing them that claims must be presented to the fiduciary on or before a specified date which shall not be less than 90 days from the date of the notice.  By this procedure, the fiduciary may limit to that period the right of the creditor to file a claim.  The fiduciary is under no obligation to send such notice to creditors.  It is the responsibility of the fiduciary to determine the validity of any claim presented and to notify the creditor of claims he or she feels are not proper.  After 150 days from the appointment of the fiduciary, a fiduciary who, in good faith, distributes estate assets will not be liable to the creditors of the estate.  Within 60 days after said 150 day period, the fiduciary must file with the court a return and list of claims with the probate court.

 

If the estate is insufficient to pay all claims, expenses and taxes in full; funeral costs, administration expenses, expenses of the last illness and debts owed the State or Federal government take precedence over other claims.  If the assets of an estate are not adequate to pay all of the decedent’s debts, the estate may be settled as insolvent. 

 

The fiduciary should not pay any claim which he or she may personally have against the estate without filing an application for and receiving approval of such claim by the court of probate.

Return and List of Claims

 

Within sixty (60) days of the expiration of the 150 day claims period, the fiduciary shall file in the probate court a Return and List of Claims and List of Notified Creditors which is a list of outstanding debts owed by the decedent prior to death.  It will also include any creditor who has made a claim within the 150 day period. 

 

Succession Tax Return

 

Within six (6) months after the date of decedent’s death, the fiduciary is required to file, in duplicate, with the court of probate a Form S-1 or Form S-2, Succession Tax Return.  The purpose of this return is to enable the Commissioner of Revenue Services to determine whether the decedent had an interest in property that is taxable for Connecticut succession tax purposes.  Information on this return would include: property that was solely in the name of the decedent, property held jointly with rights of survivorship, joint bank accounts, U.S. Savings Bonds payable on death to a named beneficiary, interests in a trust, gifts made within three years prior to death, pension plans and interests in any trusts.  Although no tax may be due, such as in the case of a transfer to a surviving spouse, a tax return still must be filed.  The probate court forwards a copy of the succession tax return to the Department of Revenue Services.  The Department of Revenue Services will notify the fiduciary of any objections within 120 days of receipt of the return. 

 

Any succession taxes due must be paid to the Department of Revenue Services within 6 months of the decedent’s date of death.  If the payment is late, interest will be charged.  If the tax cannot be paid on time, an extension of time may be requested from the Department of Revenue Services.

 

After-discovered property must be reported to the Commissioner of Revenue Services if the property exceeds $500 in value.  The court of probate must also be notified of such after-discovered assets.

 

Federal and Connecticut Estate Taxes

 

Federal.  The payment of federal income and estate taxes is part of the fiduciary’s duties.  Within 9 months after a decedent’s death, if the total value of the decedent’s assets, considering and including certain gifts made by the decedent during his or her lifetime exceeds the applicable exemption under the federal estate tax credit, the fiduciary is required to file Form 706, U.S. Federal Estate Tax Return.  This return must be filed even though available deductions will reduce the decedent’s estate to less than the applicable exemption amount.  The applicable exemption amount was increased to $1,000,000 effective January 1, 2002, and, under current law, is scheduled to increase in stages over a nine year period before reverting back to $1,000,000 in 2011.

 

Connecticut.  In addition to the succession tax, some estates may be subject to payment of a Connecticut estate tax.  The estate tax will usually be payable only in those estates of resident decedents that include a substantial amount of property which is not taxable for Connecticut succession tax purposes but is taxable for federal estate tax purposes.  A Connecticut estate tax return should be filed in every estate in which the tax might be payable.

 

Federal and Connecticut Income Taxes

 

Federal.  The fiduciary is also required to file a final Form 1040, Individual Income Tax Return, for the decedent for the tax year in which the decedent died if his or her income in that year exceeded applicable personal exemptions.  In addition, the fiduciary may be required to file, for that same year and for subsequent years, a Form 1041, Fiduciary Income Tax Return for the estate.

 

Connecticut.  The fiduciary is also required to file a final Connecticut income tax return for the year in which the decedent died if the decedent was subject to such tax.  In addition, the fiduciary may also be required, for the period in that same year after the decedent’s death, and for subsequent years, to file a Connecticut income tax return for the estate.

 

Compensation to Fiduciary

 

A fiduciary is ordinarily entitled to reasonable compensation for managing and settling the estate of a decedent.  Requests for such compensation are made in the fiduciary’s accounting which is filed with the probate court.  The probate court passes upon the reasonableness of the request at the hearing on the account.

 

Fees to the Court of Probate

 

Each estate which is administered must pay a fee to the court of probate.  The fee is used to compensate the judge of probate and to offset the costs of operating the court and statewide administration of the probate court system.  The basis for costs is the greater of:  (1) the gross

estate for succession tax purposes; (2) the gross estate for estate tax purposes; or (3) the inventory, plus all damages recovered for injuries resulting in death after payment of the costs and expenses of such recovery.  If the court appoints an executor or administrator, the minimum fee is $150.00.

 

Final Account/Distribution/Division of Assets 

 

When all of the decedent’s property has been collected, and all debts, expenses and taxes have been paid, the fiduciary must file a final account.  The purpose of this account is to inform the court and the beneficiaries of all property received and all expenses paid during the settlement of the estate and to indicate the amount remaining to be distributed to the beneficiaries.  After the account is filed, the court of probate will order a hearing to be held on the account.  Notice of the hearing will be sent by the court to the beneficiaries of the estate.  The purpose of the hearing is to allow the beneficiaries, the judge of probate, or any other interested person to object to the manner in which estate funds were used or to the proposed schedule of distributions.  When the final account has been approved, the court will order the fiduciary to distribute the assets of the estate.  After the property has been divided and distributed, an Affidavit of Closing must be filed with the court.

 

If the Executor is also a beneficiary of the residuary estate, a Statement in Lieu of Account may be filed in lieu of Final Account.  The Statement in Lieu of Account is basically a simplified and more generalized version of a Final Account.  It does not provide details concerning the receipt of interest, dividends or other items of interests, not does it reflect gains or losses incurred or accrued during the administration.  A Statement in Lieu of Account must be accompanied by waivers, signed by all beneficiaries, indicating they have received a copy of the Statement and have no objection to its allowance.  The Probate Court may approve a Statement in Lieu of Account without any further notice or hearing.

 

Generally speaking, after the distribution of all estate assets and the filing of the Affidavit of Closing, the fiduciary has no further responsibility.  At that time, the fiduciary is entitled to receive a certificate from the court of probate certifying that the fiduciary has complied with all orders of the court relating to the settlement of the estate.  The certificate received by the fiduciary may be used to terminate any probate bond.  The fiduciary, however, retains his or her status as fiduciary even though all duties have been discharged.  A fiduciary can be called upon after all assets of the estate have been accounted for and distributed to take further action on behalf of the estate or to administer after discovered assets of the estate.