What happens to a\nperson\u2019s property after death? The decedent\u2019s assets comprise his or her\nestate, and become subject to a legal process called probate. Titles 3A and 3B\nof the New Jersey Revised Statutes govern probate in the state.<\/p>\n\n\n\n\n\n\n\n
Probate is the court-supervised\nprocess of settling a decedent\u2019s estate and transferring the remaining assets\nto devisees or heirs according to the provisions of the decedent\u2019s will, if any.\nThe Surrogate Court of the county in which the decedent resided at the time of\ndeath has jurisdiction in New Jersey probate proceedings.<\/p>\n\n\n\n
Testacy refers to the\nstatus of a decedent\u2019s will. When a decedent dies with a will, the estate is\nsaid to be testate. The decedent can specify the disposition of separately\ntransferrable interests, such as real property titled in the decedent\u2019s name\nindividually or as a tenant in common, in his or her will; these assets are\nsubject to probate. Property not devised by will (i.e., intestate property) passes\naccording to New Jersey laws of intestate succession, as established at N.J.S.A. 3B:5-3<\/em> through N.J.S.A. 3B:5-14<\/em>.<\/p>\n\n\n\n Certain assets transfer\noutside of probate, regardless of the testacy status of the decedent. These include\nproperty held in a survivorship interest. In the example of two spouses holding\ntitle to realty as tenants by the entirety, upon the death of the first spouse,\nthe title devolves to the surviving spouse by process of law. In a joint\ntenancy, title passes to the remaining joint tenants. Assets held with a\nbeneficiary designation or in a trust are also exempt from the probate process.\nNote that an inheritance tax waiver or supplemental documentation, such an\naffidavit of surviving spouse, may be required to evidence the passing of\ntitle. In some cases, recording a new deed to reflect the retitled property may\nbe preferable.<\/p>\n\n\n\n In New Jersey, a\ndecedent\u2019s property devolves to devisees (beneficiaries of a testate estate) or\nheirs (beneficiaries of an intestate estate) upon death, subject to the rights\nof creditors and to administration (N.J.S.A. 3B:1-3). To prove a transfer of\nproperty and appoint an executor of the estate, however, wills must be admitted\nto probate (3B:3-18). <\/p>\n\n\n\n The court grants\nletters authorizing a personal representative (PR) to \u201csettle and distribute\nthe estate of the decedent in accordance with the terms of any probated and\neffective will and applicable law, and as expeditiously and efficiently as is\nconsistent with the best interests of the estate\u201d (3B:10-23). For intestate\nestates, an heir or any other person desiring letters can apply for\nadministration in the court (3B:10-13). A renunciation may be required if\napplication is made by someone who does not have priority administer the estate\n(see N.J. Ct. R. 4:80-3). <\/p>\n\n\n\n Letters testamentary\nevidence the appointment of an executor named in a will; letters of\nadministration authorize an administrator when the decedent dies intestate, or when\na named executor cannot serve. N.J.S.A. 3B:10-2 establishes the priority for\npersons to be appointed administrator of an intestate estate. Once appointed,\nthe PR has the same power over the title to the decedent\u2019s property that an\nabsolute owner would have, and may exercise such power \u201cwithout notice,\nhearing, or order of court\u201d (N.J.S.A. 3B:10-30). The PR must send notice of a\nprobated will, however, to all beneficiaries under the will, and any surviving spouse,\nheirs, and next of kin, pursuant to N.J. Ct. R. 4:80-6.<\/p>\n\n\n\n Among the PR\u2019s initial duties\nis marshalling the assets and taking inventory of the estate. Before an estate\ncan be distributed, the PR must pay creditors\u2019 claims on the estate. Depending\non the size of the estate, New Jersey estate tax may also apply. The estate tax\nis based on the total value of the decedent\u2019s estate.<\/p>\n\n\n\n In addition to the\nestate tax, New Jersey has a transfer inheritance tax for transfers valued at\n$500 or more [1]. Also called a \u201cbeneficiary tax\u201d because it is based upon who\nspecifically receives the decedent\u2019s property, all residents are subject to the\nNew Jersey inheritance tax unless the estate is wholly distributable to Class A\nbeneficiaries. This class includes the surviving spouse or domestic partner and\nlineal ancestors or descendants of the decedent [2]. To transfer a clear title,\nan inheritance tax waiver must be recorded with the county clerk where the\nsubject property is located. The waiver constitutes written consent of the\nDirector of the Division of Taxation to transfer or release certain property in\nthe name of a decedent [1]. New Jersey law stipulates that the estate pays only\nthe higher of two imposed taxes (estate or inheritance) [3]. <\/p>\n\n\n\n The PR can only distribute\nassets after payment of creditors\u2019 claims, if any, and applicable taxes. To convey\nreal property from a decedent\u2019s estate, the PR must execute and record a deed. A\npersonal representative\u2019s deed (executor\u2019s deed or administrator\u2019s deed) is a\ntype of fiduciary instrument, named for the capacity of the granting party\nrather than the type of warranty the grantor is making with the transfer. <\/p>\n\n\n\n A PR deed grants and\nconveys title to the decedent\u2019s realty, typically with a covenant as to\ngrantor\u2019s acts under N.J.S.A. 46:4-6, to a devisee, heir, or purchaser. In this\ntype of transfer, the grantor (here, the personal representative) promises that\nthe grantor has done no act to encumber the property and that the grantor has\nnot allowed anyone else to obtain any legal rights which affect the property\n(such as by making a mortgage or allowing a judgment to be entered against the\ngrantor). If the PR is distributing (i.e., retitling) realty, a quitclaim deed\nmay also be appropriate as evidence that title has devolved to a distributee;\ncontact lawyer with questions.<\/p>\n\n\n\n A properly executed PR\ndeed states the name and address of the acting PR and identifies whether the PR\nis an administrator or executor. In addition, the deed states the decedent\u2019s\nname, date of death, and county of residence at the time of death, as well as\ninformation identifying the decedent\u2019s estate, including the Surrogate Court\nwhere the estate is probated, the case number, and the date of issue of\nletters. In order to properly convey title, the grantee\u2019s full name, address,\nmarital status, and vesting information must appear on the deed.<\/p>\n\n\n\n When the PR is\nconveying title to a purchaser, the deed should recite the total consideration\nmade for the transfer. Deeds made by a PR to a devisee or an heir to carry out\ndistribution of the estate are exempt from New Jersey\u2019s realty transfer fee\nunder N.J.S.A. 46:15-10(6)(o). The deed must note the exemption, and an\naffidavit of consideration recorded alongside the deed.<\/p>\n\n\n\n As with all conveyances\nof real property in New Jersey, the PR deed requires a complete legal\ndescription of the subject parcel, including tax map reference pursuant to N.J.S.A.\n46:15-1.1. An effective deed also recites the grantor\u2019s source of title, including\nthe office, book and page where the prior deed is recorded, and the date of\nrecordation. The PR deed should also note any restrictions associated with the\nsubject property. <\/p>\n\n\n\n The personal representative must sign the deed in the presence of a notary public before recording in the appropriate Register of Deeds office. A seller\u2019s residency form is required for all transfers of real property in New Jersey. The PR deed should meet all other requirements of form and content for documents pertaining to an interest in realty, including any county-level requirements (such as a recorder\u2019s cover sheet).<\/p>\n\n\n\n New Jersey Personal Representative Deed Forms<\/a><\/p>\n\n\n\n The information\nprovided above is not a substitute for legal advice. Consult an attorney\nlicensed in the State of New Jersey with questions regarding personal\nrepresentative\u2019s deeds and probate procedures, as each estate is unique.<\/p>\n\n\n\n [1] http:\/\/www.state.nj.us\/treasury\/taxation\/inheritance-estate\/inheritance_over.shtml#ScheduleB<\/a><\/p>\n\n\n\n [2] http:\/\/www.state.nj.us\/treasury\/taxation\/inheritance-estate\/tax-rates.shtml<\/a><\/p>\n\n\n\n