Claiming Inherited Property With a "Small Estate" Affidavit

In many states, if the total value of property left by a deceased person is under a certain amount, the people who inherit that property can claim it without conducting a probate court proceeding. All they need to do is prepare a simple affidavit (sworn statement) and present it to the institution that has custody of the asset. This “small estate” procedure generally can’t be used for real estate, but works very well for assets such as bank accounts.

Compared to probate, the affidavit process is far easier, quicker, and less expensive for the inheritors. If you’re the executor, you’ll want to encourage inheritors to use it.

Which States Offer a Small Estate Affidavit Procedure

These states allow inheritors to claim assets with an affidavit, under certain circumstances:

Who Can Use an Affidavit

An inheritor who wants to use an affidavit to claim inherited property must state, on the affidavit, that the estate qualifies as a “small estate” under state law. The rules about which estates are small enough vary widely from state to state.

For example, in Illinois, a small estate is one that has a total value of $100,000 or less. To add up the value of the estate, Illinois law states that you must include the gross value of all of the deceased person’s personal property that passes under a will or by state law. That means you don’t include the value of:

• real estate, or
• anything that passes outside the will, such as retirement accounts, payable-on-death bank accounts, property held in a living trust, or jointly owned accounts.

Because only assets that would otherwise go through probate are counted, even large estates may qualify as small ones for the purposes of the affidavit. (Small estates may also use simplified probate procedures.)

Every state has its own rules. Some states add restrictions, such as:

• making the procedure available only to certain surviving relatives
• severely limiting the kinds of property that can be claimed (to bank accounts or vehicles, for example), or
• not allowing the procedure if the deceased person left a will.

How the Process Works

Basically, if the estate qualifies for the affidavit procedure, all an inheritor needs to do is:

• prepare an affidavit that meets state law requirements, explaining why he or she is entitled to the property and that no probate proceeding is being conducted
• sign the affidavit in front of a notary public, and
• present the affidavit and a certified copy of the death certificate to whomever is in possession of the asset.

Most states impose a waiting period of a month or two before an inheritor can claim assets with an affidavit. Banks and other institutions are familiar with the forms and should cooperate without a fuss.

Where to Get Affidavit Forms

Some state court systems (Utah, for example) and counties (Sacramento and others in California, for example) make fill-in-the-blanks affidavits available online. Some institutions, such as banks and government pension agencies or motor vehicle departments, may also provide their own forms for inheritors to use.