How to Probate a Small Estate in Alabama

 

Small estates don't have to go through probate to be distributed. Find out what Alabama's limit is for this small estates procedure.

ADVERTISEMENT -

.
 

Small Estate Limits for Alabama

In Alabama, you can't use the Affidavit procedure that's available in some states. Instead, if the estate's value doesn't exceed $34,611, you can use Alabama's summary probate procedure after waiting 30 days. The $34,611 limit only applies to estates without real property. This limit is adjusted annually for inflation, pursuant toAla. Code §43-2-692(b)(1),

For 2010 $25,410
For 2011 $25,791
For 2012 $26,616
For 2013 $27,175
For 2014 $27,583
For 2015 $28,024
For 2016 $28,052
For 2017 $28,417
For 2018 $29,014
For 2019 $29,710
For 2020 $30,245
For 2021 $30,608
For 2022 $32,047
For 2023 $34,611

Ala. Code 43-2-690.

What's Included in valuing the estate?

Not everything a person owns is part of their "Estate" for probate purposes.

If you're wrapping up the estate of a Alabama resident who died with an estate that's worth less than a certain dollar amount, you won't have to go through a formal probate court proceeding. 

It doesn't matter whether or not the deceased person left a will; what matters is the value of the assets left behind. If the estate's value is under the "small estates" limit in Alabama, you can take advantage of a simplified probate procedure, often called a "summary probate." Instead of having a court hearing in front of a judge, you may need only to file a simple form or two and wait for a certain amount of time before distributing the assets.

In some states, it can be even easier: Inheritors can use a simple affidavit to claim assets. (An affidavit is a statement you sign in front of a notary, swearing something is true.) If you live in one of those states, you just have to wait a required period of time, then sign a simple, sworn statement that no probate proceeding is happening in your state and that you are the person entitled to inherit a particular asset--a bank account, for example. 

Adding it up, what's in, what's not

When you are trying to determine whether or not an estate's value is below the Alabama small estates limit, the first thing to do is make a list of the assets. A simple spreadsheet or list will do.

Not everything a person owns counts, though.

Include only the things that pass to heirs and beneficiaries by will or, if there's no will, by Alabama intestacy laws, which determine who inherits if there is no will.

Don't count:

  • assets that are held in joint tenancy,
  • retirement plans,
  • payable-on-death (POD) bank accounts,
  • real estate transferred by a transfer-on-death deed, or
  • transfer-on-death brokerage accounts.

These assets don't count towards the small estate limit because they pass to the named beneficiaries regardless of what a will (or state intestacy law) says. If a person had a life insurance policy with a named beneficiary, the insurance proceeds won't count either.

Loans on the property?

Some states also don't count the amount of money owed on a car, or a house, while others count the fair market value of an asset, even it is subject to a loan or a mortgage.

For example, say Donald died in Alabama and owned the following assets:

  • A checking account with $2,345
  • A savings account with $2,567
  • A car with a blue book value of $6,500 (and no loan)
  • An IRA with $32,000, naming his son and daughter as beneficiaries
  • A life insurance policy worth $15,000, naming his son and daughter as beneficiaries

To figure out whether Donald is above or below Alabama's small estate limit, only the bank accounts and car would be counted, for a total of $11,412.

His IRA and the life insurance proceeds aren't counted towards the limit because they will go to his beneficiaries directly. The value of the car is included because he doesn't owe money on it.

That means the value of Donald's estate is under the Alabama small estates limit. His son and daughter, who inherit his assets under Alabama's intestacy laws because Donald had no will, would follow the small estates procedure.





Jurisdictional relevance: ST

There are versions of this article for each State.