Personal Property in Estate Proceedings

Ancient Arches

Ancient Arches

Many people have heard about the “small estate affidavit” but in fact it’s not an estate at all.  It’s an affidavit that can be completed by a successor of the decedent in order to collect probate assets which do not exceed $64,000.  (This is the 2014 year of death amount.)  A successor can be a surviving spouse, a child or other family member, and also a personal representative named in a will. Besides the limitations on the amount which can be collected using an affidavit, it cannot be used if there is real property involved.  The Colorado State Judicial website has the form and instructions here.  You can’t use an affidavit and also have an open probate for a decedent.  The Colorado probate code sections applicable to the affidavit are found at Colo. Rev. Stat. 15-12-1201 and 1202.  An affidavit can be used to simplify the collection of probate assets, or those assets titled solely in the name of the decedent.  Ten days must pass before the affidavit can be signed.  There are good public policy reasons for this waiting period.  The time period for an application for informal probate with a will, however, is only five days after the decedent’s death.

Okay, I mentioned “probate” property . . .  what’s the difference between probate and nonprobate property?  In a nutshell, nonprobate property passes automatically to a survivor by the way the asset is titled (as in joint tenancy) or if it is an asset that has a beneficiary designation.  Probate property, very broadly, is property that was held by the decedent that didn’t pass to a survivor via nonprobate means (or those means failed) or was titled solely in the decedent’s name.  There are many assets now that are commonly held that are nonprobate assets like IRA accounts, real property held in joint tenancy, and so on.  The lines that distinguish between probate and nonprobate property or assets can change or be modified by the asset’s owner – either by action or inaction.  When people come in to talk to me about estate planning and we draft a will, it is after a process of identifying assets and categorizing them as probate (which typically pass via a will) or nonprobate.

So back to the affidavit . . . the person making the affidavit, known as an affiant, is treated much like a personal representative in their presentation of the affidavit to third parties.  The personal representative is the person who is in charge of administering a decedent’s probate estate.  The challenge here is that the statutory language is silent on how someone goes about recovering property that was improperly distributed by an affiant.

Sometimes it is best, given all the circumstances at play, that an estate not be opened for a decedent.  The affidavit to collect assets can be very helpful in this regard.  But remember that the Colorado DMV prefers that you use their form available here and not the one in the state judicial website if a car is involved in these circumstances.

So, what about your personal property,- your stuff – in the probate context when there is a will and an estate opened? Colorado law, like that of many other states, provides something called a “memorandum disposition of tangible personal property.”  Okay, so what’s the difference between tangible and intangible personal property?  When you think tangible, think stuff – like china cabinet contents, mementos that hold emotional value (many people tend to fixate on the financial value of the item.  Intangibles are things like digital assets, and those are a bit more complicated.  The nice thing about the memorandum disposition is that is a document that can be easily changed and updated and can be incorporated by a person’s will be reference to it.  This allows for flexibility in deciding to whom your personal property will be given as what you have, get rid of, and acquire changes over time.

In addition to the memorandum disposition, there are creative ways in a will to divide up personal property.  Personal property can of course be mentioned specifically in a will as a devise of a particular thing to a particular person, and it can be given as a gift to a class of people like children or grandchildren, and there are many other ways of dividing the property if a division isn’t made prior to the person’s death.  These could include a private or a family auction, depending on the nature of the property and considering the emotional value of the items in relation to the financial value.  Many people writing an estate plan focus on the financial value of  the property when it is more often the emotional value that is most dear to the surviving loved ones.  Just another reason for a person to share the stories that go with those mementos, so that the stories get handed down along with the particular item.

Making plans for the disposition of your personal property can make a personal representative’s and your surviving family members lives much easier.  Don’t forget to include those plans as part of a comprehensive estate plan.

©Barbara Cashman  2014


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