Why Does a Probate Estate Need to be Closed

By Lane V. Erickson, Idaho Business Attorney

As the premier Idaho estate planning and probate law firm, our team of attorneys at the Racine law office have been helping clients create their own customized estate plans for more than 70 years. We have also helped clients complete the probate process when a family member or loved one has passed away. We are knowledgeable and experienced with the probate process and have helped numerous clients complete all the steps necessary to properly probate an estate.

Our team of estate planning lawyers consists of partners Randy Budge, and Lane Erickson, and attorneys Nate Palmer and Dave Bagley. Each of our attorneys has received the highest ratings possible on several legal rating services, including Martindale and Hubbell, AVVO, and Justia. These ratings are earned based on feedback from clients, other attorneys and the judges we work with on a regular basis. Given our experience we believe that we have the ability to assist each of our clients with the probate process.

Once a probate is completed, the personal representative files specific documents verifying that they have completed everything that needs to be done and asking the court to formally close the probate estate. The law does not require that a probate estate be closed in this way. However, when we assist our clients with a probate, we make sure we always close the estate through a verified statement filed by the personal representative. The purpose of this article is to discuss the reasons that we file the documents to close the probate estate once a probate is completed.

Before we talk about the steps involved in closing a probate, we will talk first about the timing of when a probate estate can be closed. According to Idaho’s statutes, a probate must remain open for at least six months after the date of the original appointment of the personal representative for the estate. In other words, the probate estate has to remain open at least 6 months after the order is entered by the court that appoints a person to be the personal representative.

For those of us who do probates regularly this makes perfect sense. Without getting into all the details, because of the statutory scheme involved in the probate process, 6 months is the minimum amount of time necessary to complete everything that needs to be done in a probate including providing notice to all creditors and dealing with creditor’s claims.

When a probate is closed it requires the personal representative to file a sworn statement, which we call a verified statement. This simply means that the personal representative is testifying directly to the court and that his testimony is being notarized so as to make it legally effective testimony the court can rely on.

The sworn statement contains information related to the fact that all creditors’ claims have either been paid, discharged, or have expired. Additionally, the personal representative is testifying that they have fully administered the estate by making all payments, settlements, or distributions necessary including the payment of all inheritance or other taxes. This information goes to all the heirs of the estate.

Prior to making distributions to the heirs, we provide a full accounting from the personal representative to the heirs. This accounting identifies all expenses that have been paid, and the plan for distribution. We then request that each heir sign and return to us a consent and waiver form indicating that they have reviewed the accounting and that they agree with the distributions that will be made.

By accomplishing this, all the heirs are aware of everything that has been done in the estate by the personal representative. Additionally, each heir provides written approval of the actions the personal representative has taken including the proposed distributions.

When a personal representative formally closes at an estate through a verified statement, it acts as a protection to the personal representative. Specifically, Idaho statutes state that “Unless previously barred by adjudication and except as provided in the closing statement, the rights of successors and of creditors whose claims have not otherwise been barred against the personal representative for breach of fiduciary duty are barred unless a proceeding to assert the same is commenced within six (6) months after the filing of the closing statement. The rights thus barred do not include rights to recover from a personal representative for fraud, misrepresentation, or inadequate disclosure related to the settlement of the decedent’s estate.” Idaho Code § 15-3-1005.

In summary, the statute simply means that in most instances, claims cannot be brought against the personal representative unless they are brought within six months of the filing of the closing verified statement. While there are some limited exceptions, closing of a probate estate through a verified statement provides very specific protections to the personal representative.

In addition to providing protection to the personal representative, closing an estate also acts as a protection for the heirs who receive a distribution from the estate. Idaho Code § 15-3-1006 specifically protects heirs who receive a distribution from the estate. No creditors or other distributees can make a claim against any other distributee if it has been longer than 1 year after the estate was closed.

If you are involved in a probate, or have any probate questions, including how to properly close a probate estate, contact us. We have helped numerous clients with these types of issues, and we are confident that we can help you too!

Our team of Idaho lawyers can help you with any of your estate planning or probate needs. Whether you are seeking to create or review an estate plan for yourself or would like to help a loved one, we are available to discuss your options and answer your questions at an initial free 30-minute consultation. Call us toll free at 877.232.6101 or 208.232.6101 for a free consultation. You can also email us directly at lane@racineolson.com or stop by our office at 201 East Center Street, Pocatello, Idaho 83201. We will answer your questions and help you solve your Idaho Estate Planning problems.