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Court Order Distributing Small Estates

Section 3982 of the Estates and Protected Individuals Code provides a simplified procedure for distributing small estates if the balance of the gross estate after the payment of decedent's funeral and burial expense consists of property of $15,000 or less. The $15,000 is figured by adding all assets of the decedent less any liens against any asset. Ordinary debts of the decedent are not subtracted in making the calculation. Therefore, the $15,000 is a gross estate value. For example, an estate with a single assets consisting of real estate worth $30,000 with a mortgage of $16,000 would qualify while an estate with $15,500 of assets and bills of $2,000 owed by the decedent would not. The $15,000 amount will be adjusted annually for inflation beginning January 1, 2001.

Upon a showing of evidence, satisfactory to the court, of payment of the expenses for the decedent's funeral and burial, the court may order that the property be turned over to the surviving spouse or, if there is not a spouse, to the decedent's heirs.

Upon a showing of evidence, satisfactory to the court, that the decedent's funeral or burial expenses are unpaid or were paid by a person other than the estate, the court shall order that the property be first used to pay the unpaid funeral and burial expenses, or to reimburse the person that paid those expenses, and may order that the balance be turned over to the surviving spouse or, if there is not a spouse, to the decedent's heirs.

Other than a surviving spouse who qualifies for allowances under this act or minor children of the decedent, an heir who receives property through an order under this section is responsible, for 60 days from the date of the order, for any unsatisfied debt of the decedent up to the value of the property received through the order.

This procedure begins with the filing of a form titled Petition and Order for Assignment (PC 556). The filing fee is $25 plus inventory fees. A receipt showing the status of the funeral bill must be attached to the Petition. This whole procedure can usually be completed as soon as the papers are filed with the probate court.

MCL 700.3983 of the Estates and Protected Individuals Code contains a very similar provision that may be used to distribute estates of this size when no real property is involved. That provision is discussed in the prior probate note entitled Exceptions to Probate.

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