Topic: Virginia Small Estates Act

ESTATE PLANNING; VIRGINIA SMALL ESTATE ACT

By Milton Babirak, JD, LLM      |      Babirak Carr, PC     |     Sterling, VA

You may not have a small estate but there are many circumstances when people die with a small estate. For example, when a parent dies, they may have spent almost all of their estate on the expenses of their care or last illness, including assisted living care, and medical and hospital bills. Also, someone with substantial assets in their revocable trust may die leaving a few small items outside their revocable trusts (for one reason or another) and these items need to be transferred on death.  What happens to these small estates?

 

Virginia has the Virginia Small Estate Act that provides two different ways by which certain small assets owned by a decedent can be transferred at death without a formal probate administration. The Act defines a small asset as any bank account, savings institution account, credit union account, brokerage account, security, deposit, tax refund, overpayment, item of tangible personal property, or an instrument evidencing a debt, obligation, stock, or chose in action. If the total value of the decedent’s personal probate estate does not exceed $50,000, the Act provides that a person who possesses certain property of the decedent may transfer the property to decedent’s successor (person named in the decedent’s will or pursuant to intestacy) if the successor provides an affidavit that provides that: the estate does not exceed $50,000; at least 60 days have passed since the decedent’s death; no personal representative has been appointed an no application for appointment is pending; the decedent’s will, if any, has been probated; and the person claiming the asset is entitled to it.

 

There is an alternate procedure by which any person having possession of an asset of a decedent valued at $25,000 or less can pay or deliver that asset to a successor without the need for an affidavit provided only that: at least 60 days have passed since decedent’s death; and no application for the appointment of a personal representative is pending or been granted in any jurisdiction. However, in the case of this alternate procedure, most persons in possession of a small asset typically insist on an affidavit described above, even though not required under the Act.

 

Upon the presentation of an affidavit as described above, the designated successor may endorse or negotiate any small asset that is a check, draft, or other negotiable instrument that is payable to the decedent or the decedent's estate.

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