On March 31, 2012 the Massachusetts version of the Uniform Probate Code (“MUPC”) went into effect. The MUPC changes the entire process for probating an estate here in Massachusetts. Not only did it overhaul the type of Court proceeding used to probate an estate, but it also alters who inherits property for those people who die intestate (without a Will). Below are a few examples of the changes created by the new law.
Changes in Intestacy Laws: For anyone who dies without a Will, the distribution of his or her assets are determined by the laws of intestacy. The MUPC made some drastic changes to this distribution determination. The ultimate answer of who inherits depends upon who is living at the time of death, but here are a couple of examples:
a. Under the old law, if you died with a surviving spouse and children from the marriage, a portion of the estate would go to the surviving spouse and the remainder of the estate would go to the children. Under the new law, in this same scenario the entire estate now goes one hundred percent to the surviving spouse. Children are excluded.
b. Under the new law, if you die with a surviving spouse and children from a prior marriage, the first $100,000 goes to the surviving spouse. The remaining property (after the first $100,000) goes one-half to the surviving spouse and one-half to the children from the prior marriage.
c. Under the new law, if you die without a surviving spouse but with surviving children and grandchildren, the MUPC now distributes the estate through a system of “per capita at each generation”. The old law of distribution was “per stirpes”. To illustrate the difference, consider the following example:
Assume you have an estate worth $1,000,000. At the time of your death, you have two living children (“A” and “B”) and two children who predeceased you (“C” and “D”). Child “C” had one child and child “D” had two children. Under the old system of “per stirpes” distribution, child “A” and “B” each receive $250,000, the one grandchild from child “C” receives $250,000, and the two grandchildren from child “D” split the remaining $250,000 and receive $125,000 each. Now, under the new system, child “A” and child “B” still receive their $250,000. However, the grandchildrens’ distributions change so that all three of them split equally the amount that would have gone to children “C” and “D”. In this situation each grandchild receives $166,167, a very different result from the old “per stirpes” system.
Terminology: The term Executor, Administrator, etc. are no longer used. All fiduciaries appointed by the Court for estates are now referred to as Personal Representatives.
Choice of Proceeding: The MUPC has implemented a system where the Personal Representative can select the type of probate proceeding he/she wants to pursue. The available options are: Informal Probate, Unsupervised Formal Probate, or Supervised Formal Probate. Which option is most appropriate depends on a number of case specific factors. Informal Probate is designed to allow for a much quicker, less costly probate proceeding with minimal court involvement. A Supervised Formal Probate is more in line with the prior system where the process takes more time and there is more direct court involvement. An Unsupervised, Formal Probate is somewhere in between. In deciding which proceeding is appropriate, the Personal Representative needs to balance the speed and efficiency of the Informal Probate with the added protections the Court provides in a Formal Probate proceeding.
Statue of Limitations: Under the new MUPC, wills must be probated within three years of death. Failure to probate the will within three years means the Court will handle the probate as though the decedent died without a will and the intestacy rules described above control who inherits. Under the old law it was possible to probate a will for up to fifty years after death.
The most important thing to remember is that nothing replaces good planning. Some of the most significant changes brought about by the implementation of the MUPC impact people who die intestate (without a Will). With proper planning, you can not only simplify the probate process, but you may be able to avoid it altogether.