Probate vs. Non-Probate Assets in Ohio

Under Ohio state law, probate assets are property titled solely in the name of the decedent, the person who died. Probate property is distributed according to the decedent’s will. If the decedent died without a will, probate property is distributed according to Ohio intestacy laws.

Non-probate property is property owned by the decedent which the decedent did not own as an individual. For example, real estate that the decedent and their spouse owned jointly is non-probate property. Real estate that was only in the decedent’s name is probate property.

Examples of probate assets include:

• Real property or partial interests in real property.
• Personal property such as motor vehicles, boats and other items with legal title issued by a state agency in the decedent’s name.
• Items of personal property like paintings and jewelry.
• Stocks, bonds and other securities.
• Bank accounts and other financial accounts.
• Business interests, such as a third ownership in a business.

Ohio is an equitable distribution state, not a community property state. An item acquired by the decedent and their surviving spouse during the marriage will be marital property. But the exception to this rule is if the decedent inherited property or received it in their name alone as a gift. If this is the case, the property will be separate property and will count as a probate asset.

Non-probate assets include any property in which the deceased person had an interest but was not titled solely in their name. Non-probate assets include:

• Real property or partial interests in real property with joint owners.
  
• Personal property such as furniture.
• Life insurance policies.
  
• Bank accounts, including payable on death (POD) accounts and transfer on death (TOD) accounts.
  

Note that a TOD account is often used to transfer funds or stocks, bonds and other securities to a beneficiary after the decedent dies. A POD account is a bank or credit union account that pays out to a named beneficiary without a requirement to go through the probate process.

A fiduciary, a person that acts on behalf of the estate for the benefit of the beneficiaries, is required to create a list of non-probate assets and their values. Alternatively, an attorney for the fiduciary can perform this task. The list should be filed with the court under seal.

The creator of the list should create a separate list for joint and survivorship property passing to persons other than the decedent’s surviving spouse. Survivorship property is property that was jointly owned by two or more people and has a right of survivorship designation.

This means the property passes immediately to the surviving party or parties without going through the probate process.

The fact that the decedent created a valid will does not avoid the probate process. The probate process involves the appointment of an executor if there was a will, or an administrator if there was not.

This individual gathers the assets, pays debts and costs such as funeral expenses and distributes the remaining assets to the beneficiaries who inherit under the will or per the intestacy statutes.

The decedent’s death is the event that triggers the probate process. There is a fee to probate an estate. The amount of the fee depends on the county in which the probate case was filed and the value of the estate. Typically, the fee is calculated by an algorithm on the county probate court’s website. The executor or administrator electronically files the case.

An attorney who is skilled at estate planning can help a decedent draft a will or assist an executor or administrator to determine what is probate property. In Ohio, an executor or administrator is not required to hire an attorney to go through the probate process.

An executor or administrator cannot request legal assistance with the probate process from the court’s attorneys.

An executor, administrator or other fiduciary may be able to get answers to common questions regarding probate assets from a lawyer at the probate court’s resource center. The lawyer at the resource center is allowed to answer questions such as “What is a probate asset?”

Small estates – estates that are not worth a large amount of money – can be handled outside of the traditional probate process. A small estate is eligible for a release from administration, or skipping the probate process, if:

• Surviving spouse inherits the entire estate, and the decedent's estate is worth less than $100,000.
• Person other than the surviving spouse inherits the estate, and the estate is worth less than $35,000.

There are fees for a release from administration, which vary by county. In order for a small estate to be released from administration:

• Monetary limits for the estate must be met.
• All probate assets of the estate must be reported on the application filed with the court.
• All interested parties, including next of kin, beneficiaries under the will, and creditors must be given notice of the filing of the application for release from administration and any hearings set on the matter.
  
• Decedent’s creditors must not be prejudiced by approval of the application.

To apply for release from administration, an individual must submit certain documents to the probate court:

• Government-issued photo ID card.
• Original will of the decedent.
• Complete packet of the forms required for the specific type of process requested.
• Certified copy of death certificate.
• Proof of funeral home payment in full.
• If value of estate assets is over $35,000, surviving spouse must provide certified copy of marriage abstract if there is no will.
• Verification of the existence of assets in the decedent’s name, including bank statements, and copy of Ohio certificate to vehicles, including mobile homes, trailers, boats and motorcycles.
• Deed to real property.
• Decedent’s last paycheck.
  
• Stocks, bonds and other securities in the decedent’s name.

A small estate may be eligible for real estate transfer only if the decedent died more than six months ago, no creditors have filed claims, and the decedent died owning only real estate.