When is Probate required in Oregon?

Do I have to file for probate in Oregon?

Probate is not always needed or desirable when someone dies in Oregon.  There are instances when property transfers without having to go to court.  Other times, probate is the only way to transfer the property from the person who died to the heirs.

When is Probate needed?

1. To transfer property or real estate that is titled in the deceased person.  This is most common when there is real estate that is titled only in the name of the deceased person but may also be need when there are bank accounts and investment accounts.

2. To resolve conflicts among the heirs.  The children and family of the deceased person may not agree about the authenticity of the will or may have other issues involving the estate.

3. To collect debts and enforce other rights.  People may owe the deceased person money or have other obligations that can be enforced by the personal representative of the estate.

When is Probate not needed?

1.  There are no assets or the assets are not titled. 

2.  Transfer-On-Death and Payable-On-Death selections were made and the assets were transferred to the beneficiary automatically.

3.  The property was jointly owned and transferred to the co-owner automatically at death.

If you have more questions about the Probate Process in Oregon you can read articles in the blog, visit our Probate practice or ask me a question. 

Compensation of Personal Representative in Oregon

Personal Representative Fee

In Oregon, the personal representative of a probate estate is entitled to compensations for the services provided to the estate.  The personal representative must apply for the fee from the court.  By statute, ORS 116.173, the compensation is based on the value of the estate.

Property subject to the Jurisdiction of the Court (Probate Property)

Probate Property Value	Compensation
Less than $1000	7%
Above $1,000 and not exceeding $10,000	4%
Above $10,000 and not exceeding $50,000	3%
Above $50,000	2%

Property not subject to the Jurisdiction of the Court (Non-Probate Property)

Non-Probate Value	Compensation
All property, exclusive of life insurance proceeds, not subject to the jurisdiction of the court but reportable for Oregon inheritance or estate tax or federal estate tax purposes.	1%

Additional Compensation

The personal representative may be entitled to additional compensation "as is just and reasonable"  that is extraordinary and unusual circumstances.  The personal representative must request the additional compensation from the court.

Special Provisions in the Will

The Will of the estate that is being administered may have made a special provision for the compensation of the personal representative.  In these situations, "the personal representative is not entitled to any other compensation for services unless prior to appointment the personal representative signs and files with the clerk of the court a written renunciation of the compensation provided by the will."   

If you have any questions regarding the administration of an estate or how the probate process works, please search the blog or contact me.  

Probating Joint Bank Accounts in Oregon

Who Gets the Money in the Joint Checking Account?

People often open a joint account with a child or caretaker so that they can help take care of bills and expenses as they age.  This is typically done for convenience but once that person dies determining who owns the money in the account may not be as easy as you think.  

Under ORS 708A.470, the sums remaining in a bank at the death of a party to a joint account are rebuttably presumed to belong to the surviving party.   What this means in is that the child or caretaker on the account owns the remaining money but you may be able to fight it.  Most people assume that the Will determines who receives the money in the account.

The rebuttable presumption under ORS 708A.470 may be overcome by evidence that the deceased party (1) intended a different result; or (2) lacked capacity when the joint account was established.  

Although not as convenient as opening a joint account, there are many other ways to plan your estate so that you can be protected as you age.  I've written about them here.

What Happens to assets if an Estate isn't Probated in Oregon?

Probate is just the court administered transfer of property after their death.  Not all property is subject to the court process and sometimes it doesn't make sense to initiate a probate proceeding.

Non-Probate Property

Beneficiary Designations

Some property doesn't have to be admitted to probate in order to transfer.  Think about your bank, brokerage or life insurance accounts.  Often times these accounts are transferable by the beneficiary designations.  When you initially opened these accounts you were probably asked to select a beneficiary.  Because these accounts are contracts between you and the bank, brokerage or insurance company, the beneficiary designation will direct whoever holds your account to transfer it to your beneficiary after your death.

Below is a snip from the Servicemember Group Life Insurance application.

SGLI Beneficiary

If you read the language carefully it says "If you do not specifically name beneficiaries, your insurance will be paid by law."  What this often means is that if you don't designate a beneficiary the accounts will be paid to the estate and administered by the court.

While this is a quick and inexpensive way to transfer property after death it is very limited.  Like the picture above, most companies will allow you only a few options on how you want to distribute the account.  If you want to split the proceeds in a more complicated way you will need a more involved estate planning.

Keeping Beneficiary Designations up to Date

Using a beneficiary designation is only helpful if it is accurate.  I suggest that you review your accounts annually to make sure the designations are accurate and up to date.  It's not uncommon to find former husbands and wives as beneficiaries on accounts years after a divorce.   That is not a situation anyone wants to deal with your passing.

Transferable on Death Deeds

A few years Oregon adopted a Transfer on Death Deeds.  I believe most states have adopted them at this point.  Much like their name implies, these deeds transfer title in real estate on your death.   TODD are one of the most loved estate planning tools if you have an uncomplicated family.   The primary reason an estate has to be admitted to probate is real estate.  Removing real estate from the equation may let you avoid probate or allow you to settle the estate via the Small Estate process.

I've inserted a snip from ORS 93.975 that provides the form for TODD deeds.

TODD Language

If you only have one heir then a Transfer on Death Deed may make sense for you but anything more complicated and I would be leery of using it.

Abandoning Property

Often times someone will die owing more money than their estate is worth.  When this happens, heirs sometimes decide to just walk away and let the banks foreclose on the property.

If you have any questions about how probate works or what property is included, please feel free to contact me.