Small Estates - Is Probate Always Necessary?
For estates with a total value of $50,000 or less, Virginia has adopted a set of statutes – the Virginia Small Estate Act – designed to alleviate the need to go through the full probate process in order to pay out a decedent’s accounts.
In order to qualify for treatment under this Act, both the value of the asset and the total estate value must be $50,000 or less. For simplicity’s sake, we will use the example of a bank account; however, the asset could take the form of any number of other accounts or evidences of debt owed to the deceased person.
Under the Virginia Small Estate Act, the bank must pay over the account to a “designated successor” when the designated successor gives the bank an affidavit. The affidavit must contain eight statements, laid out in Code Section 64.2-601(A):
That the value of the decedent's entire personal probate estate does not exceed $50,000;
That at least 60 days have elapsed since the decedent's death;
There is no personal representative (executor) of the estate, and no one has applied to be one;
That the decedent's will, if any, was duly probated;
That the claiming successor is entitled to payment or delivery of the small asset, and how;
The names and addresses of all successors, to the extent known;
The name of each successor designated to receive payment or delivery of the small asset on behalf of all successors; and
That the designated successor has a fiduciary duty to safeguard and promptly pay or deliver the small asset to other successors, if any.
If the asset is valued at less than $25,000, the process is even simpler: No affidavit is necessary. Only points 2 and 3 above are required.
No matter the value of the asset, the designated successor is responsible for getting it distributed to the right person(s). The designated successor is legally liable for what happens to the asset. The bank (or other institution) is not required to ensure the asset goes to the right person(s) once it has been paid to the designated successor.