Guiding You Through Colorado Probate
Managing a loved one’s affairs following their death is never easy. Not only are you dealing with the loss, but you may also need to navigate the probate or trust administrative process, which can certainly feel overwhelming.
Probate is a process under which a court appoints an individual, known as a personal representative, to administer and distribute the estate. It only applies to assets titled solely in the name of the deceased. If the property is held in joint tenancy or has a beneficiary designation such as an IRA or life insurance policy, then that property will pass outside of probate, regardless of the terms of a will or trust. There is also a simplified process for probate estates under $82,000.
If the deceased has a will, the personal representative distributes the property in accordance with its terms. If there is no will, distributions are made in accordance with the Colorado Probate Code. In either case, a personal representative needs to be appointed by the court. Duties of the personal representative include:
- Gathering estate assets
- Preparing an inventory
- Liquidating or retitling estate assets
- Notifying and paying creditors
- Preparing final tax returns
- Distributing assets to beneficiaries
- Filing accountings
- Closing the estate
The entire process involves the preparation and filing of several documents with the court.
Although the use of a trust may avoid probate, many issues still need to be addressed in administering and distributing trust assets following the death of the deceased grantor.
What Is Medicaid Estate Recovery?
Medicaid Estate Recovery is a process through which states seek reimbursement for long-term care services provided to Medicaid recipients after their death. The acceptance of Medicaid assistance creates a debt that is enforceable after the death of the client. This recovery applies to those Medicaid clients who were age 55 or older at the time the services were received or who were institutionalized.
Colorado’s estate recovery program is administered by a third party, not the state’s Medicaid program itself. The Colorado Department of Health Care Policy & Financing (HCPF) contracts with Health Care Management Systems, Inc. (HMS) to administer the Colorado Estate Recovery Program. Estate recovery is accomplished in two ways: either a lien is placed on the client’s property or a claim is filed against the client’s estate when the client passes.
There are measures an elder law attorney can employ to avoid or limit estate recovery. Colorado limits Medicaid estate claims to property in a “probate” estate. In Colorado, “estate” is legally defined as the property of the deceased whose affairs are subject to the Probate Code. Certain properties may be exempt from the program. A home may be exempt from the estate recovery program if a spouse, sibling, or, in some instances, a child is living in the home.
Frequently Asked Questions About Probate In Colorado
Below are answers to some of the most common questions we receive about probate in Colorado.
How long does the probate process typically take?
The Colorado probate process generally takes between six months and one year to complete for most estates. This timeline includes the mandatory creditor claims period of four months from the date of publication of notice to creditors. More complex estates with multiple assets, contested wills or tax issues may take longer to resolve. Smaller estates that qualify for simplified probate procedures may be completed more quickly. The court's caseload also affects the timeline.
What are the responsibilities of an executor or personal representative in probate?
The personal representative has numerous legal responsibilities during the probate process. These duties include locating and gathering all assets of the deceased, creating an inventory of these assets and determining their value. The representative must notify creditors of the death and pay valid debts from estate assets. They must file final income tax returns and possibly estate tax returns. Throughout the process, the personal representative must keep detailed records of all financial transactions. Finally, they must distribute the remaining assets to beneficiaries according to the will or state law and provide a final accounting before closing the estate.
Can probate be avoided, and if so, how?
Yes, probate can be avoided through proper estate planning techniques. Creating a revocable living trust and funding it with your assets during your lifetime allows those assets to pass to beneficiaries without going through probate. Jointly held property with rights of survivorship passes directly to the surviving owner. Assets with beneficiary designations pass directly to named beneficiaries. Beneficiary deeds for real estate can also avoid probate. For smaller estates, Colorado offers simplified probate procedures for estates valued under $82,000 with no real property.
What are some common mistakes to avoid during the probate process?
Several missteps can complicate probate administration and should be avoided. Missing court deadlines for filing inventories, accountings or other required documents can cause delays and potentially lead to removal of the personal representative. Failing to properly notify all potential creditors may extend the time needed to close the estate. Distributing assets prematurely before all debts and taxes are paid can create personal liability for the representative. Incorrect asset valuation can cause tax issues, while improper distribution that does not follow the will or state law may result in litigation.
Guiding Families Through The Probate Process
We have years of experience guiding families through administering and distributing their loved ones’ estates. Let us relieve you from some of the worry and stress associated with probating the estate. Fees for services on uncontested cases are typically charged on a fixed flat-fee basis. For more information regarding probate, we invite you to contact us at one of our offices to schedule an initial appointment. Call 303-500-5859 in Englewood or 303-720-7260 in Boulder County. Alternatively, you can reach out to us online. All communications are held in complete confidence.