Probate and Estate Administration in New York State
After a person passes away, if they have assets that pass to their heirs through a will (generally, assets held in the individual name of the decedent), then a will is probated in the Surrogate’s Court in the county where the deceased person lived. Generally, the greater the amount of assets the person had when they passed away, the more complex the estate administration and the more complex the tax issues. To probate a will, a probate petition and other documents must be filed in court and the closest next of kin must be notified of the will, even if they are not named in the will.
If an individual passes away without a will, their "probate" assets will pass to their heirs through an estate administration, also in the Surrogate's Court in the county where the person lived. The assets will pass to the decedent's closest next of kin, as set forth in New York State statute.
When a loved one passes away, it is important to keep in mind that potentially three different kinds of tax returns may need to be filed: the deceased's final personal income tax return for the last calendar year they were alive; an estate tax return (if the deceased's taxable estate exceeds $3,125,000 and died before April 1, 2016, or exceeds $4,187,5400 and died on or after April 1, 2016); and a fiduciary income tax return (if estate assets earn more than $600 in a year). For these reasons alone, it is wise to at least consult an attorney after a loved one dies, to understand the parameters of what needs to be done to settle the person's estate and whether taxes will be owed.
If estate taxes are to be owed, (in 2016, to New York state, as per the numbers stated above, and to the federal government, if an individual's estate is worth more than $5,450,000 [or $10,900,000 for a couple after the second spouse dies, with portability]), important post-death estate tax planning may need to be done. Making the proper decisions after death potentially can drastically reduce estate taxes owed. These decisions need to be made soon after a person dies, so if you think estate taxes may be owed, you should consult an attorney.
If an individual dies and owns personal property with a gross value of $30,000 or less, their estate may be settled in Surrogate's Court through a small estate administration. (If the decedent is survived by a wife or child or children under 21 years of age, the law allows certain property to be exempt from the $30,000, including household appliances and furniture; a computer and books; a motor vehicle not exceeding $15,000 in value; and cash not exceeding $15,000.) A small estate administration is much simpler and less costly than a regular probate. It's possible for a family to do this on their own, without consulting an attorney. The family should consult the Surrogate's Court in the county where the decedent lived.