kelly0224 - Pennsylvania Estate & Probate

[anteater]

Kelly - You locked your thread.

What is the name of your state (only U.S. law)? Pennsylvania:

My dad just passed without a will. He was divorced. He had been sick for some time and had distributed assets as gifts long ago. He felt he had taken care of everything. I am the eldest of his 3 children. All that is left is:
Bank#1
Bank checking account - approx $1000
Bank money market - approx $2000

Bank #2
Savings - $1000 (to be issued in a check to the Funeral Home)

A vehicle with death insurance benefits that will pay it off and the listed beneficiary is "the estate." FMV = $10,500

A pension death benefit of $4000 to a off the record business partner.

He had given the vehicle to me informally, but my siblings are aware and will not contest it. And then the $3000 at Bank #1 will be distributed equally amongst the 3 children.

Also - we are 100% that there are no outstanding debts.

Questions:
I assume the items listed above are called "the estate"

What exactly is probate? Do we need a lawyer? Is what I described above a "small estate"? What do we have to pay PA estate tax on, what do we have to pay inheritance tax on? Seems like this should be easy; but if a lawyer is necessary is this usually an expensive bill?

Unfortunately PA does not have a true small estate procedure that bypasses the probate court. The closest to it is:

§ 3531. Estates not exceeding $25,000.

When the gross real and personal estate of a decedent does not exceed the value of $25,000, the personal representative, after the expiration of one year from the date of the first complete advertisement of the grant of letters, may present his petition to the court with an annexed account showing the administration of the estate, the distribution theretofore made and suggesting the proper distribution of the estate not theretofore distributed. Thereupon, the court, upon satisfactory proof of notice to all known parties in interest, may approve the distribution theretofore made and order distribution of the assets not theretofore distributed and discharge the personal representative and his sureties from future liability without the expense of proceedings as in a formal account. The court may discharge only the surety from future liability, and may allow the personal representative to continue without surety upon condition that no further assets shall come into the possession of the personal representative until he files another bond, with sufficient surety, as required by the register.

Pennsylvania probate is not terribly complicated. I suggest that you enter something like "pennsylvania probate process" in a search engine. That should find a number of websites that will give you a general overview of the process. Also, try the probate division at the Orphans' Court in the county where you father resided. They may have some materials on hand that would help you.

As small as the estate is, you could probably use the assistance of an attorney. If you are willing to do most the legwork, you should be able to hire one on an hourly basis. Organize all your materials and ask a couple probate attorneys for an initial consultation. Most will give you 15 - 30 minutes without charge.

PA's estate tax is only applicable if a federal estate tax is due, which, in your case, it isn't. PA inheritance tax applies to nearly all transfers to non-spouse beneficiaries. The rate for lineal descendants is 4.5%, 12% for siblings, and 15% for all others.

You have a couple iffy situations where the assistance of an attorney will come in handy. Life insurance benefits are one of the few items exempt form the inheritance tax. Whether the death benefit insurance on the car loan can be wrangled under the definition of "life insurance", I am not certain. I don't want to say with certainty, but I believe that the pension death benefit is subject to inheritance tax.