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My brother lived nearly all of his adult life in a foreign country. He passed away recently. Because his death was not unexpected, he had already arranged for all of his belongings and property in his country of residence to be gifted as a sanctuary to the little town that had welcomed him.
All his estate in this foreign land has been distributed appropriately, according to his wishes. I have been assisting him with his banking in the U.S. for the last 3 years. A very modest amount is left in this banking account — definitely not enough to go through probate court.
He honestly believed the power of attorney was also the beneficiary of this account, so a beneficiary was not listed. I have the ability to access his account, but also know doing so would not be considered legal. No family member would contest using these funds as a contribution to the sanctuary he established.
How do I go about withdrawing the money without a will?
The Sister
Dear Sister,
Probate would probably be excessive for such a small amount of money.
You will most likely be able to submit a “small-estate affidavit” or “affidavit of voluntary administration.” Each state sets a level at which you will have to file for probate; assuming the money in your late brother’s account does not reach this threshold, you can fill out the paperwork to distribute the money to your brother’s heirs and, hopefully, to his charity.
This streamlines and simplifies the distribution of assets. In New York, for example, if your brother died with less than $50,000 of personal property, it’s considered a small estate and you can carry out a voluntary administration. In California, the threshold is higher ($184,500). In Ohio, it’s $100,000 for a surviving spouse or $35,000 for a non-spouse heir.
If you go this route, you may not even need an attorney, says Diane K. Roskies, a principal attorney at Offit Kurman in New York who advises U.S. and multinational citizens on U.S. trust and estate matters. “In many probate courts, a court clerk will meet with you and help you to complete the required documents,” she says.
Voluntary administrator
Roskies says you should bring the following documents to the court clerk: an original death certificate; an English translation of the death certificate, and a signed certification by the translator and a notary public; an original recent bank statement, which includes the address of the bank; the POA your brother signed, preferably the original; and photo identification.
The Surrogate’s Court appoints a voluntary administrator. If there was a will, the executor of the will is appointed the voluntary administrator. As there is no will, the closest relative is named the voluntary administrator. As his sister and the person who held power of attorney, which ceased upon your brother’s passing, you would be an obvious choice.
If there was a will, the executor of the will is appointed the voluntary administrator.
The lesson, of course, is to always make a will. Studies show that people with less money and younger Americans tend to not bother writing a will. For those 50 and older, less than half of household heads have a will, but that figure rises to 67% by age 70, according to this survey carried out by the Center for Retirement Research at Boston College.
Those percentages are much lower for less wealthy households and for Black and Hispanic households, the survey found. The three main reasons why people got a will: They had a child (20%); they had a close family member or friend who passed away (11%); and/or their parents, family or friends recommended that they write a will (11%).
Trust versus will
California’s Attorney General says that, when it comes to people with larger estates, it “must be given notice of any matter involving a gift to charity, assets held in charitable trust, disposition or gifts of assets to an unnamed charitable beneficiary, or property that may escheat to the State of California.” Similar laws exist in other states. You can read more here.
For those who want their estate and their wishes to remain private and confidential, a trust will serve them better than a last will going through probate court. When the will is filed with probate court, it becomes part of the public record, and family members, extended family members, friends, next-door neighbors and old high-school classmates can access it.
The grantor, the person who sets up the trust, can also act as the trustee during their lifetime, and they have the freedom to change the terms. They can leave instructions to distribute the assets held by the trust according to their wishes. Those wishes may change over their lifetime. They can also retitle their home, bank accounts and other assets into the trust.
My condolences to you. Your brother was very fortunate to have you.
You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com. Check out the Moneyist private Facebook group, where we look for answers to life’s thorniest money issues. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.
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Previous columns by Quentin Fottrell:
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