Inventory and appraisal.  The administrator must identify and determine the fair market value of all financial assets and property that were owned by the decedent at the time of death. The administrator must file an inventory listing all of the decedent’s so-called probate assets and their date-of-death values with the probate court within three months of the administrator’s appointment, unless an extension is granted.

It is important to understand that most estates include what are known as non-probate assets, which generally do not have to be included in the inventory filed with the probate court. Non-probate assets are assets that legally pass from a decedent to a named beneficiary or to a co-owner at the time of death, by title, by contract, or by law, without having to go through the probate court. Non-probate assets include:  insurance policies, IRAs and retirement benefits that are payable on death to a beneficiary; and a home, car or bank account that the decedent owned jointly with rights of survivorship to another person, or in payable-on-death or transfer-on-death ownership. In many cases, many of a decedent’s assets may be non-probate assets. The administrator must identify and report non-probate assets for tax purposes if federal estate tax reporting is required, but these assets are not otherwise included in the probate estate for which the administrator is responsible to the probate court. When this pamphlet refers to collecting or distributing a decedent’s assets, it refers only to those assets that are subject to probate court process even if other property is taxable.

In valuing and reporting assets and liabilities, if the value is “readily ascertainable” (for example, shares of stock in a publicly traded company or the balance in a bank account), then no professional appraisal is required. However, items such as jewelry, art objects, antiques, real estate and any other items whose value cannot be readily established must be appraised by a qualified person in order for the inventory to be approved by the probate court and for any tax returns to be acceptable to the taxing authorities.

Collecting assets.  The administrator must collect all assets of the decedent. This is very important because it is these assets that will be distributed to the heirs after debts and taxes have been paid.  Complications can arise in this process if assets legally owned by a decedent are in the possession of someone else at the time of death, or if property belonging to the decedent has been concealed or misappropriated by a third party. Sometimes collecting assets may require the administrator to complete a lawsuit in which the decedent was involved at the time of death, or to file a new lawsuit to satisfy a legal claim the decedent had not fully asserted while aliveFor example, if the deceased was killed in an accident it may be necessary to file a suit to recover damages for wrongful death.

Payment of debts and expenses.  Creditors (people to whom the decedent, or his or her estate, owes money) have six months from the date of death to present their claims against the estate. In most cases, any claim not submitted within six months is barred forever. Claims must be in writing and sent directly to the administrator or mailed to the decedent’s address, and must be received by the administrator within six months. In addition to ordinary bills the decedent owed at the time of death, other debts typically include expenses to keep up property; local, state and federal taxes; hospital and funeral expenses; and expenses of administration including probate court costs, bond premiums and fees charged by appraisers, attorneys and the administrator.

Even after accepting a claim as valid, the administrator must be certain there will be sufficient assets to pay all claims, including those not yet presented. Certain debts have priority. Generally, costs and expenses of administering the estate, funeral expenses and taxes must be paid first. If there are sufficient cash assets in the estate to pay debts, they will be paid out of cash. If there is not enough cash, then estate property will be sold (personal property first and then real estate) to raise the cash needed.  If the total assets in an estate are not sufficient to pay all of the valid debts, claimants must be paid according to a priority schedule established by law.|

Distribution of assets.  After all debts, taxes, costs and expenses of the estate have been paid, the administrator must distribute the balance of the estate to the decedent’s heirs according to a formula prescribed in Ohio’s statute of descent and distribution. Because an administrator may be held personally liable for anerror in making a distribution that cannot later be recovered, legal advice should be obtained before making a final disposition of estate assets. Sometimes an administrator will make a partial distribution of certain assets before all claims have been resolved. In such cases, it is prudent for the administrator to advise persons receiving early partial distributions that they may be required to return some or all of the money or property to the estate if it is needed to satisfy valid claims.

If a decedent is survived by a spouse and no surviving children or descendants of deceased children, the entire estate goes to the spouse. 

If a decedent is survived by a spouse and one or more children or their descendants, and if all the children who survive or who have descendants are also the children of the surviving spouse, the entire estate goes to the surviving spouse.

If a decedent is survived by a spouse and one child or the child’s descendants and if the surviving spouse is not the natural or adoptive parent of the child, the spouse receives the first $20,000 from the estate plus one-half the remainder of the estate. The balance of the estate passes to the child or, if the child is deceased, to the child’s descendants.

If a decedent is survived by a spouse and more than one child or their descendants, the spouse receives the first $60,000 if the spouse is the natural or adoptive parent of one, but not all of the children, or the first $20,000 if the spouse is not the natural or adoptive parent of any of the children. The spouse receives one-third of the balance of the estate and the children will receive two-thirds of the balance of the estate in equal shares.  Descendants of a deceased child divide that child’s equal share. 

If there is no surviving spouse, but surviving children or their descendants, each of the children receives an equal share of the estate.  Descendants of a deceased child divide that child’s equal share.

If the decedent has no surviving spouse or children and no descendants of deceased children, the estate goes to his or her surviving parent(s) or, if both parents have died, in equal shares to brothers and sisters or their descendants.