If you’ve been chosen as an estate executor you probably want to know how long it takes to settle an estate. Most estates close within a year, but yours may not fall into that easy category. We’ve worked on cases that dragged on for multiple years, leaving executors exhausted, families in pieces and estates depleted.
What makes the difference between a few months of probate versus years of turmoil? It boils down to complexity and family issues. Here are the five most common causes we’ve seen of extended probate.
1. Complicated Estates
It can take years to unravel a particularly large estate or one that includes a wide variety of assets. For example, if the decedent left behind a private business that controlled multiple limited liability corporations (LLCs), owned foreign property, or held assets that are hard to value, such as a stable of race horses--it could take months of forensic accounting and a cadre of outside appraisers to put a price on an estate like that. And it could take even longer to liquidate assets if they need to be sold.
2. Estates that Owe Federal Taxes
Executors have nine months to file estate taxes, and while filing the taxes doesn’t necessarily take that long, it can be months before the Internal Revenue Service (IRS) gets around to processing the return. In fact, the IRS website asks that filers wait at least four months after filing the return to even request an estate tax closing letter. It could take another four to six months for the return to be reviewed and approved. And if the IRS doesn’t like the math, the agency will kick the whole thing back, and you’ll have to start over.
3. Estates with Many Beneficiaries
Large families may include beneficiaries scattered around the globe. Tracking them down, notifying them and getting their signatures on necessary documents can take a lot of time. We worked with an estate in which one of the beneficiaries had died, so his children became beneficiaries. That’s not unusual, but in this case one of the daughters was estranged from him and the rest of the family. While she didn’t challenge the estate, she simply refused to acknowledge the notifications and ignored documents that required her signature. She managed to drag probate out for an extra six months.
4. Disgruntled Family Members
This is the most common reason for dragging out probate that we see, and it usually occurs when one of the decedent’s heirs isn’t named as a beneficiary. Courts recognize heirs as “interested parties” in the estate, giving them the right to challenge the Will, the executor, and the disbursement of assets. They seldom win, but a constant barrage of petitions, suits and countersuits can hold up the process for months or years.
5. The Wrong Person Acting as Executor
Unfortunately, this is also a situation we see pretty regularly. Despite their best intentions, some people simply aren’t suited to the stress and demands of being an executor. We worked with one man who was so paralyzed by his grief and overwhelmed by the task of probating the estate, he simply shut down. He was so worried about making the wrong move, that he didn’t move at all. In this case, probate dragged on for two years, which simply prolonged everyone’s pain unnecessarily.
Once the process hits any of these speedbumps, there’s not a lot an executor or the probate court can do to speed it up. The best strategy is to try to anticipate any potential problems and give beneficiaries a head’s up so they know what to expect. Open and honest communication is your best option for ensuring a smooth probate process—no matter how long it takes.