A common reason people give for creating an estate plan is that they want to avoid their estate going through probate. Part of the concern about probate involves fear that the estate will be consumed by probate costs. What exactly does probate (also known as estate administration) cost in Colorado, and are there any ways to minimize that cost?
The first question is difficult to answer precisely. The cost of probating an estate depends on many factors, including the difficulty of the probate estate. The second question is a little easier to address: there are ways to reduce probate costs, including by reducing the complexity of the probate estate.
Factors Affecting the Cost of Colorado Probate
How much probate costs, and how long it takes, will vary from case to case. All Colorado probate cases vary in cost from start to finish, and can be considerably more costly for a large, complex, contested estate.
Expenses typically associated with a Colorado probate matter include court fees, appraisal costs, personal representatives’ fees, attorneys’ fees, accounting fees, and surety bonds. These expenses are likely to be different in each case, depending on:
- Whether there is a will
- Whether an existing will is contested, or there are other disputes related to probate
- The value of the estate
- The complexity of the estate, including whether the estate owns real property, and whether any real property owned by the estate is located outside Colorado
- Whether the court requests any third parties to perform a service for the benefit of the estate, such as an appraisal.
Fiduciaries, including personal representatives of the estate, are entitled to compensation, as are attorneys and any third parties who perform a service for the estate at the court’s request. Reasonableness isn’t determined by the use of any particular method, such as taking a percentage of an estate, or charging a flat fee or hourly rate, but rather by considering all relevant circumstances. Fees for personal representatives, attorneys, and other professionals are paid from estate funds.
Keeping Colorado Probate Costs Down
There are two primary things that can be done to minimize probate costs. The first is to reduce the size of the estate that must pass through probate. Property can be moved into living trusts in order to bypass probate. Depending on the type of property, it may be able to be transferred outside probate through other means, such as placing funds in a joint bank account. The second way to keep probate costs down is to make one’s wishes clear in an enforceable legal document, to reduce the risk of expensive will contests. Both of these goals–minimizing the probate estate, and minimizing the risk of conflict between heirs–can be achieved through careful estate planning.
Whether you are looking to minimize probate costs in the future, or need to administer a Colorado estate today, a knowledgeable attorney can help. We invite you to contact the experienced estate planning and probate attorneys at Davis Schilken at 303-670-9855 to arrange a consultation at one of our two locations in The Denver Tech Center and Golden, Colorado, to learn how we can help you.