What Is Considered an Estate When Someone Dies?

Property

Physical property that was owned by the deceased is considered part of the estate. This includes items such as jewelry, clothing, automobiles, household goods, tools or computers. An estate includes a house and land, intellectual property, cash, bank accounts, retirement accounts, vacation homes, stocks, bonds and other items. These items must be distributed to others or organizations after death.

Dividing up and distributing the property to family or survivors is called "settling the estate." The way an estate is handled depends upon the size of the estate, where the property is and if there is a will. The will lists the beneficiaries of the estate. An estate belonging to a decedent who is not wealthy or who doesn't have much property might be settled in a month or so, while a larger estate may take years, if the will is contested or the estate is particularly large and complex.

The process of settling the estate is called "probate" and is handled by a court where the decedent resided. Probate law varies from state to state. During probate, the decedent's residence is determined and the will is validated. Certain items must go through probate before they are finally released or willed to beneficiaries. Money, life insurance plans, bank accounts and other proceeds may be distributed by the court. Smaller estates, the range of which is determined by the state, may be exempt from the probate process, and instead use the simplified process. Gifting your property before you die is an effective way to avoid the probate process.

The executor of the estate is the person named by the decedent to handle the affairs and administer the estate. This person is usually a trusted adviser or loved one who will ensure that the deceased's final wishes are carried out, and is a time-consuming and important duty. Some of the duties of the executor include notifying beneficiaries named in the will, handling the inventory of property, sending death notices to utilities or credit card companies and filing for Social Security benefits. An executor is usually paid from the estate to handle these duties.