Over the past 17 plus years of working with many Louisiana families to complete the succession of a deceased loved one, I have encountered numerous questions. I will go through some of the more common questions in this blog post.
- What is a succession? A succession (sometimes referred to as probate) is the process for the distribution of the deceased person’s assets and payment of estate debts and expenses. A succession is the transmission of the estate of a deceased person to his successors, the people inheriting the assets. The successors must obtain proof that they are the legal owners of the decedent’s assets. The proof is necessary to identify the new owner(s) to third parties in order to sell, lease, mortgage or otherwise use the property of the estate as the owner. A primary function of a succession is to determine the identity of the deceased person’s successors and to re-title and place them into possession and ownership of the estate assets. For example, financial institutions will not release funds and investments to the successor until proper documentation of a succession is provided. Likewise, a buyer of real estate will require proof of good title to property a successor inherits. A Judgment of Possession rendered at the conclusion of a succession provides the buyer with proof of the transfer to the successor. In addition, a succession provides an orderly process to pay the outstanding debts owed by the decedent.
- How long does a succession take to complete? The length of time depends on the complexity of the estate and how long it takes to gather the information required to complete the succession documents. As a practical matter, it typically takes two to six months to complete a succession. Some successions remain open for years due to complexity, litigation between the heirs, or a number of other reasons.
- If someone dies with a will is a succession necessary? Yes, a succession is necessary whether the decedent died testate (with a will) or intestate (without a will). A will allows you to override the Louisiana intestacy laws which determine who inherits your assets if you do not have a will. We recommend a will or a revocable trust (to distribute your assets without going through a succession) to allow you to retain control of who inherits your assets.
- Do we have to pay taxes on the assets we inherit? Louisiana repealed its inheritance tax, so no taxes will be due to the State of Louisiana. If your estate’s value is in excess of $5,340,000 (2014), the estate is subject to federal estate taxation. If your estate exceeds or is approaching the exemption limit, contact us for a consultation to discuss how to avoid the estate tax.
- The will left everything to me, so why did I not inherit the retirement accounts? Certain assets are non-probate assets and are not controlled by the will or the Louisiana intestacy laws. Retirement accounts (IRAs, 401(k)s, 403(b)s, 457 plans, etc.) are distributed by its beneficiary designation. Likewise, life insurance and annuities are distributed by its beneficiary designation. The people listed as the beneficiary will be the new owner(s) even if the will provides that the entire estate goes to someone else. Beneficiary designated assets do not go through probate and are not controlled by the will unless the estate is the beneficiary.
If you have questions about successions or need to open a succession in Louisiana, contact John Sirois in Houma at 985-580-2520 or by email at . He is also available by appointment in Metairie.