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Please Note: The following information is not intended to be legal advice or create a Hawaii attorney client relationship. It is general information about Hawaii probate law, and should not substitute for hiring an attorney in Hawaii. It does not cover all information regarding Hawaii probate. Thank you.
PROBATE IN HAWAII:
What is Hawaii probate?
Very simply, Hawaii Probate is a procedure in the Hawaii Circuit Court that allows for administration of the decedent’s probate estate (the decedent is the person who has died). It is the process that allows for the decedent's assets to be distributed to the beneficiaries of the decedent's estate.
After the death, it must be determined what property, if any, has to go through probate. Not all of the decedent's assets will be part of the probate estate. For example, a life insurance policy usually designates a beneficiary. That life insurance policy isn't part of the probate. The life insurance proceeds go to the named beneficiary of the policy. A bank account that is a payable-on-death account with a named beneficiary would not be part of the probate estate. The contents of the account go to the named beneficiary of the account.
On the other hand, if the decedent owned Hawaii real property and his or her name is listed on the Deed as the sole owner, then that real property has to go through probate.
Hawaii Collection by Affidavit: it may be the case that a probate is not necessary. Collection by Affidavit is a simpler process than probate. If the decedent’s probate estate in total is worth less than $100,000 (not including vehicles owned by decedent) and does not include real property, and no probate petition has been thus far filed, then you may be able to use this process instead of opening a probate if you are the successor to the decedent, meaning you are entitled to the property as a matter of law. But how? The successor executes an affidavit that has language dictated by Hawaii Revised Statutes section 560:3-1201(a). The bank where the account is held might have an affidavit form as well. The successor will also need a certified copy of the death certificate. The 3rd party, such as a bank, will have limited liability in relying on the affidavit.
But what about the decedent’s motor vehicles in Hawaii? They may be transferred by affidavit and the Hawaii DMV has an affidavit form. This is a link to instructions regarding the decedent’s vehicle: https://www.honolulu.gov/rep/site/csd/Ownership_Transfer_-_Death_of_Owners_5.14.21.pdf
Hawaii Small Estates Administration: This method can be employed instead of a Hawaii probate in the case where the value of the decedent’s property doesn’t exceed $100,000—even if the property is real property. The clerk of the court is appointed to assist with the administration of the estate.
Hawaii Summary Administration: This is a streamlined probate process. When the total value of the estate does not exceed the debt, including the statutory allowances, then there is a summary administration process under Hawaii Revised Statutes 560:3-1203 allowing the Personal Representative to distribute the assets without notice to the creditors before closing out the decedent's estate.
Hawaii Informal Probate Proceeding: Most Hawaii probates can be opened as an informal proceeding. Generally speaking, this kind of proceeding is just like it sounds: informal. The Personal Representative will be appointed by a court registrar, not a judge, and no court appearances will likely be necessary. It is initiated by an Application and can be started as soon as 5 days after the date of the death of the decedent. An informal proceeding requires less filing of paperwork and is less expensive. It is the favored approach when no formal proceeding appears necessary. If a parent, spouse, reciprocal beneficiary, a decedent of the parent of the decedent, or a corporate fiduciary submits the Application, then no advanced notice required to the interested parties or creditors. How quickly are the Letters Testamentary or Letters of Administration issued by the Court? It depends on the registrar but less than two weeks is not abnormal. This is one reason why it is faster than a formal probate.
If an issue arises, the proceeding could be converted to a formal proceeding by the Personal Representative or another interested party to the probate. Another way an informal proceeding may be converted automatically to a formal proceeding is if there is an objection to the informal probate.
Disadvantages of informal probate: No certainty to cut offs to liability. There is no adjudication regarding the validity of the Will. The estate will remain open for contests to the Will for either 90 days after receiving notice of the Personal Representative's appointment in the informal proceeding, or if no notice is received, then it is 12 months from the date the Will was informally admitted to probate, or 30 days from the entry of a formal order approving the accounts and settlement of the estate, if that takes place, whichever of those time period expires first. However if notice was not received, the court can still allow a Will contest up to 5 years from the date of death. See Hawaii Revised Statutes section 560:3-108 for the law regarding these time periods.
Hawaii Formal Probate Proceeding: The Hawaii formal probate proceeding may be necessary where there is some question surrounding the estate. The formal proceeding results in the court formally deciding whether the decedent had a valid Will or who the heirs are under the laws of intestacy (if there is no Will). The formal proceeding also can resolve an issue if there is a question about who should be the Personal Representative of the Will if that issue is in dispute. It could be supervised or unsupervised. Unsupervised means the Court doesn't oversee the estate after the Personal Representative is appointed until the probate is coming to an end and the Personal Representative wants to make distributions and close the estate. If a formal Petition it stays any informal Hawaii proceeding that has been filed. Formal probates are initiated by a Petition and other documents are filed with the Court. If the Will was not "self-proved" then the witnesses to the Will have to get a statement from the witnesses for the formal probate.
Special Administration: A Special Administrator is appointed for limited purposes, either formally or informally. A person may need to use this process to determine if there are assets that need to be probated but because there is no authority to gather the information. It could be used to file or accept service of a lawsuit because there is no personal representative but the creditor has to serve process on the estate. Also the Special Administrator could be appointed for emergency purposes or handle conflicts of interest.
Ancillary Probate: Ordinarily a probate will occur where the decedent was domiciled (where he or she lived and died). However sometimes the Personal Representative will find out that there is real property in a jurisdiction other than where the probate was initiated. The law that governs real property is the law of the State in which the real property is located. The same goes for tangible personal property. Because of that, another probate may have to occur in a different state than where the decedent was domiciled or where the probate was originally initiated.
In Hawaii there are several ways that this could occur:
If there are no probate assets and no probate was initiated in the state where the decedent died, then a regular (non-ancillary) informal or formal probate could be opened in Hawaii.
If there was a probate opened in another state then the Personal Representative could possibly get an Acknowledgment of Authority issued in Hawaii. Authenticated copies of the Letters Testamentary or Letters of Administration are required for this process. This process acknowledges the authority of the Personal Representative to act in Hawaii with respect to the assets of the estate located in Hawaii.
Ancillary Probate: This process is similar to the regular probate. This process is generally not necessary and an Acknowledgment of Authority would suffice.
The following information is intended to be general and does not create an attorney/client relationship. Please seek legal advice for your particular unique situation.
HAWAII INTESTACY
What happens if someone dies without a valid will in Hawaii?
If a person dies without a valid will in Hawaii, then we call that person the "decedent" and we say that the decedent has died “intestate”. The decedent’s property will pass according to the applicable laws in Hawaii instead of a will.
However, not all of the decedent’s property in Hawaii will pass according to the Hawaii laws of intestacy. Property that has a designated beneficiary will go to the beneficiary, such as in the case of retirement and life insurance policies. Also, property titled with the right of survivorship will go to the surviving beneficiary. This includes Hawaii property titled in joint tenancy or tenants by the entirety and there is a surviving owner.
For example, if two spouses own Hawaii real property as tenants by the entirety and one spouse dies, the other spouse will be the owner of the property, solely. The same is true of reciprocal beneficiaries.
Similarly, if decedent had a living trust and the Hawaii property was titled in the name of the trust, then that Hawaii property will be held in trust, and will not pass to anyone under the Hawaii laws of intestacy.
If the decedent died owning Hawaii property, and it will pass according to the laws of intestacy, the Hawaii property might need to go through probate.
The following information is intended to be general and does not create an attorney/client relationship. Please seek legal advice for your particular unique situation.
GENERAL PROBATE TIMELINE
ONCE APPOINTED AS PERSONAL REPRESENTATIVE:
The following information is intended to be general and does not create an attorney/client relationship. Please seek legal advice for your particular unique situation.
AVOIDING PROBATE
You always hear of people wanting to take steps to "avoid probate". But why? Probate takes a long time and expensive. Taking a long time means at least 6 months in Hawaii and that would be a faster proceeding. That means the heirs or beneficiaries of the decedent's estate won't get their share of the estate for that long. Also, probate is expensive. Along with filing fees that are hundreds of dollars, the notice to creditor, which must be published in the a newspaper of general circulation can cost between $700-$900. Of course there are attorney's fees to be paid as well. The Personal Representative will also likely hire an accountant and maybe other professionals to help administer the estate. Appraisals of property are also very expensive. Appraisals of real property in Hawaii cost around $1,000. Probate takes a long time and it can be expensive, and that is why estate planning attorneys counsel their clients to try to avoid it.
The following information is intended to be general and does not create an attorney/client relationship. Please seek legal advice for your particular unique situation.
HAWAII PROPERTY LEFT OUT OF TRUST
In many cases, decedent set up a trust to avoid probate. They title all their property into the name of the trust. Then later they buy a piece of real property in Hawaii, which they forget to title into the name of the trust. In that case, the trustee will find that the Hawaii real property has to go through probate in Hawaii because all real property must be probated in the state where it is located. In this situation a probate would be opened in Hawaii in order to distribute the Hawaii property to the appropriate beneficiaries. If the decedent had a will that had a "catch all" provision to leave all property to the trust (known as a pour over will) then the beneficiary will likely be the trustee. If you are in this situation, don't despair! I can help with your Hawaii probate.
The following information is intended to be general and does not create an attorney/client relationship. Please seek legal advice for your particular unique situation.
HAWAII PERSONAL REPRESENTATIVE'S RESPONSIBILITIES
You are named the personal representative in the decedent's will and you are not sure what to do. Seek the advice of an attorney, but here are some things to think about:
The primary duties of a personal representative are to inventory all the decedent's assets, pay his or her legitimate creditors, and distribute the remaining assets to the heirs or beneficiaries.
A personal representative for a decedent's estate is also a fiduciary of the estate and must act in the best interest of the estate. This means that the personal representative cannot act in a way that would harm the estate or try to gain a benefit from the estate that he or she is not entitled to. As soon as possible you will want to open the probate so you can act officially on behalf of the estate.
Take inventory and control of the estate. Where do you find information about the estate? In the decedents papers, files, mail, and safe deposit box. The bank should let you have access to the safe deposit box in order to look for the decedent's will.
Forward the decedent’s mail to you. You can do this online via USPS. See https://moversguide.usps.com/mgo/disclaimer or you can pick up a change of address form at the post office. This will be important as you are required to find creditors and close the decedent’s various accounts.
The estate includes real estate, stocks, mutual funds, jewelry, furniture, cars and basically anything that is valuable. These items will be sold or distributed later. This means making a list of what the decedent owned that is valuable.
· Determine the value of the assets as of the date of death. The value is what the item would sell for, not the amount for which the item was purchased. You may need to get items appraised.
· Make a list of the decedent’s debts prior to death. Debts of the decedent are things like mortgages, utility and credit card bills and taxes, including the decedent’s income taxes and property taxes.
The personal representative could be personally liable for any unpaid taxes of the decedent.
· It may surprise you to learn that you do not have authority to write checks from the decedent's account. Even if you had power of attorney, that is no longer valid upon the decedent's death.
· You will need to open a bank account to distribute the assets of the estate. You will be named as the personal representative of the estate on the account. You will need the letters testamentary or the letters of administration plus the federal EIN number to do this. That is why one of the first things to do as a personal representative is apply for a federal EIN for the estate. You should apply for this number as soon as possible because you need to enter this number on returns, statements, and other documents you file concerning the estate. You can get a federal EIN by applying online at IRS.gov/EIN. Generally, if you apply online, you will receive your EIN immediately upon completing the application. You can also apply using Form SS-4, Application for Employer Identification Number. If you apply by mail, it can take a month to get the EIN.
· Begin an assets distribution plan before making any distributions. You must determine who will get assets and in what order before you start distributing. Certain creditors will have to be paid, but taxes may have priority over those claims.
· Determine the priority of the claims against the estate.
· Think about negotiating creditor’s claims down before you pay them in full. You can try to negotiate with a creditor to pay less.
· During the administration of the estate, the personal representative has an obligation to protect the assets of the estate. If the personal representative fails to pay insurance premiums on real property, that could be harmful to the estate if there’s a theft or fire, etc. The personal representative should act in the best interest of the overall estate. So be sure to protect the assets. As stated above, don’t give anything away or forgive any of the decedent’s debts.
· If you haven’t done so already, you should notify the VA if the decedent was a veteran.
. The Personal Representative needs to notify the social Security Administration about the decedent's death, by calling 800-772-1213. The funeral director may very well do this for you. In any case, you will need the decedent’s social security number.
· Any social security checks for the month in which the decedent died, or later months, must be returned or repaid. If the decedent had been receiving Medicaid benefits, the SSA can seek reimbursement from the estate. Refer to this publication: https://www.ssa.gov/pubs/EN-05-10008.pdf for more information.
· Firearms: there are Hawaii state laws related to firearms, so be sure to keep that in mind if the decedent had any firearms.
This is really a 30 thousand foot view of what it is like to administer an estate. There are many considerations.
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