It can be a financial lifeline when a loved one leaves you money in their will. However, because of Pennsylvania probate rules, it could take months or years to receive your inheritance.
The good news is that you have other options. Instead of waiting for probate to conclude, you can receive funding early with Rockpoint Probate Funding. We provide cash advances on pending probate cases, allowing you to skip the waiting period.
To decide whether this option is right for you, you may want to learn more about how probate works in Pennsylvania.
What Is Probate?
Probate is the legal process of distributing a deceased person’s assets to heirs and creditors. It typically starts with appointing a personal representative, who is responsible for cataloging assets, paying off outstanding debts, and distributing the rest of the estate to the legal beneficiaries.
If a will names a personal representative, that person will administer the estate according to the decedent’s wishes. If there is no will, the court will appoint one to administer the estate according to state laws of intestate succession. That means the decedent’s closest relatives will inherit the estate in the order and amount dictated by law.
Does Pennsylvania Require Probate?
Pennsylvania requires probate in most cases, both for estates governed by a will and those without a will. This process can be long and complex. Fortunately for beneficiaries, not all assets must go through probate to transfer ownership.
In addition, simplified probate is available for estates worth $50,000 or less (excluding real estate). A small estate affidavit allows heirs to claim their inheritance without formal probate. If the decedent owned real estate, however, Pennsylvania requires the initiation of formal probate.
Do All Assets Require Probate?
Assets that the deceased person owned alone typically must go through probate. Other assets automatically go to the beneficiary upon the owner’s death without the need for probate. These include the following:
- Property in a living trust
- Jointly owned real estate with rights of survivorship
- Life insurance policies or retirement accounts with named beneficiaries
- Accounts with payable-on-death or transfer-on-death provisions
- Bank account funds up to $10,000
- Up to $10,000 in compensation paid from the decedent’s employer to the surviving spouse or other close family member
How Does Pennsylvania Probate Work?
The Pennsylvania probate process involves the following steps:
- Opening probate: The estate executor files a petition (and the will, if one exists) with the court where the deceased person lived.
- Appointing the executor: The court appoints the personal representative named in the will or another person if there is no will.
- Notifying heirs and creditors: The executor notifies beneficiaries and creditors of the probate process.
- Cataloging assets: The executor inventories and values all assets in the estate.
- Settling debts: The executor pays all creditor claims and outstanding bills, including filing tax returns and paying taxes.
- Distributing assets: The executor distributes the remaining assets to legal heirs and petitions the court to close the estate.
Does Pennsylvania Have an Inheritance Tax?
Pennsylvania is one of a handful of US states that impose an inheritance tax. This means that the state taxes beneficiaries on their inherited assets rather than taxing the deceased person’s estate.
Heirs must pay this tax within nine months of the decedent’s death or apply for an extension. A 5% discount is available for those paying their inheritance tax within three months.
The Pennsylvania inheritance tax rate varies by the heir’s relationship to the decedent.
- 0%: Transfers to a surviving spouse or a parent from a child aged 21 or younger
- 4.5%: Transfers to direct descendants and lineal heirs (grandmothers, grandfathers, mothers, and their children)
- 12%: Transfers to siblings
- 15%: Transfers to other heirs (except charities, government entities, and other exempt institutions)
What Happens If Someone Dies Without a Will?
Careful estate planning can determine which assets go to which heirs when a person dies. When someone dies without a will in Pennsylvania, the laws of intestate succession control the distribution of assets.
For example, Pennsylvania law specifies the following if the decedent had:
- Children but no spouse: Each child receives an equal part of the estate.
- Spouse but no children: The decedent’s spouse inherits the entire estate.
- No spouse or children: The decedent’s parents receive everything.
- No spouse, children, or surviving parents: Each sibling receives an equal part of the estate.
- None of the above: The estate goes to extended family members in a specific order, with nieces and nephews, grandparents, aunts and uncles, and cousins all potentially in line for the inheritance.
What Is a Personal Representative?
A personal representative, often referred to as the executor or administrator, plays a crucial role in the probate process in Pennsylvania. This individual is responsible for managing the decedent’s estate, which includes gathering and valuing assets, paying debts, and distributing the remaining assets to beneficiaries. If a will exists, the personal representative will follow the stipulations outlined within it, while in the absence of a will, the court appoints someone based on state laws.
Being a personal representative is a significant responsibility that requires thorough knowledge of the probate laws and an ability to make sound financial decisions. The appointed representative must remain impartial and strive to act in the best interests of all beneficiaries. This responsibility often means a considerable time investment, as they are required to keep clear records and potentially outline their actions to the court to ensure transparency and compliance with Pennsylvania laws.
Understanding Intestate Succession in Pennsylvania
Intestate succession is the legal process that dictates how an estate is divided when someone dies without a valid will in Pennsylvania. The law specifies a clear order of inheritance based on familial relationships, which often results in assets being distributed to surviving children, parents, or siblings in predefined proportions. This prevents disputes among surviving relatives by providing clarity on who inherits what, though it may not reflect the decedent’s wishes.
For example, if an individual dies leaving behind children but no spouse, each child will share the estate equally. In cases where there are no immediate family members, the law outlines extended family members who may inherit, such as nieces, nephews, and even cousins. The intestate succession laws serve to streamline the inheritance process, but they underscore the importance of having a will, as individuals often prefer to have specific wishes carried out rather than have state laws dictate the terms of their estate distribution.
Probate Fees Explained
Probate fees in Pennsylvania can accumulate throughout the administrative process of settling an estate, making it crucial for heirs to understand these costs. Common expenses include filing fees for initiating probate, attorney fees if legal representation is utilized, and executor compensation, which is defined by Pennsylvania law as reasonable compensation for the executor’s work. Additionally, professional fees for appraisals and assessments may also be needed, not to mention costs related to any potential litigation if disagreements arise among beneficiaries.
It’s essential to note that while probate fees can seem daunting, they are typically paid from the estate funds before beneficiaries receive their inheritances. Transparency in these fees enables heirs to better prepare for the eventual distribution of assets and may influence their decisions regarding the necessity of probate funding options, such as cash advances that can help mitigate the financial burden while waiting for the estate to settle.
The Role of Executors in the Probate Process
Executors have several critical duties throughout the Pennsylvania probate process, starting with filing the necessary petitions to initiate probate proceedings. Their responsibilities extend to nominee tasks such as identifying and securing estate property, settling debts, and ensuring that tax returns are filed. Throughout this process, executors must act in good faith, prioritizing the interests of the estate and beneficiaries while adhering to the law.
Communication is a vital aspect of the executor’s role, as they often need to keep beneficiaries informed about the estate’s status and any decisions made. Balancing these responsibilities requires a considerable amount of organization and integrity, as executors are often under scrutiny from beneficiaries who may have differing opinions on how the estate should be managed. Executors must also be well-versed in relevant state laws to effectively navigate potential challenges that may arise during the probate process.
How Much Does Pennsylvania Probate Cost?
Probate costs depend on the estate’s size and complexity. Common Pennsylvania probate fees include the following:
- Filing fees and additional probate court fees
- Legal fees, if a lawyer works on the case
- Executor compensation, which Pennsylvania law requires to be “reasonable”
- Professional fees for property appraisals, accounting services, land surveyors, etc.
- Fiduciary bonds, which courts may require to protect the interests of the beneficiaries
- Extraordinary fees in cases of pending litigation, hidden assets, or contested wills
Probate fees and related expenses typically come from the estate funds.
Can I Access My Pennsylvania Inheritance Instantly?
Now that you know more about Pennsylvania probate, you may wonder when you’ll receive your inheritance. Rather than waiting months or years for your funds to clear, you can receive cash through Rockpoint Probate Funding as soon as today!
Unlike traditional loans, our probate cash advances don’t require a credit check or income verification. We also don’t control what you spend it on. It’s your inheritance, after all. You can use it to pay for living expenses, school tuition, car repairs, or even a much-needed vacation.
Where Can I Find Rockpoint Probate Funding in Pennsylvania?
Rockpoint Probate Funding provides probate funding in counties across the state, including the following:
- Philadelphia County
- Allegheny County
- Bucks County
- Delaware County
- Lancaster County
- Montgomery County
- Berks County
- Chester County
- Cumberland County
- Dauphin County
Apply for an Immediate Inheritance Advance Today!
Why wait for your case to clear Pennsylvania probate if you need money today? Call Rockpoint Probate Funding at (888) 263-8588 for more information about borrowing against your inheritance advance immediately.
