The Nebraska Small Estate Affidavit, more formally known as the Affidavit for Transfer of Personal Property without Probate, is a very useful tool for people inheriting assets from decedents with probate property of less than or equal to $100,000.
What this means is that you may not need a lawyer and you may not need a probate court in order to collect inheritance assets from a loved one. You may only need the fully executed Nebraska Small Estate Affidavit, your photo identification, and an original death certificate.
Five things to keep in mind with respect to the Affidavit’s utilization and application:
1) The Affidavit is only applicable to assets held in Nebraska.
This would include what is commonly referred to as tangible personal property. Tangible personal property is property that one can feel, touch, or physically relocate. This includes, but is not limited to, clothing, vehicles, jewelry, equipment, etc.
Nebraska assets also include intangible assets. Intangible assets include, but are not limited to, stocks, bonds, bank accounts, certificates of deposit (CD’s), business interests, etc. The key here is that: a) the applicable decedent must have lived in Nebraska at the time of their death (exceptions are beyond the scope of this presentation); and b) the asset otherwise qualifies as a probate asset.
But what is a probate asset? A probate asset is simply an asset in which the decedent owned the asset solely in their name at the time of death. For example, if John Doe owned a savings account in his name (only), that asset is a probate asset. It would require either John Doe’s Will, or if he has no Will, the Nebraska statutes of intestacy, to determine who is to inherit the savings account.
Assets that are not probate assets are commonly referred to as nonprobate assets. These are assets in which the decedent did not own the asset solely in their name.
Examples of such are a joint checking account (commonly known as joint tenancy with rights of survivorship), a house owned jointly, a payable on death (POD) account, an asset owned in trust by the decedent, a life insurance policy with a beneficiary listed in it, or a retirement account with one or more beneficiaries listed in it.
These nonprobate assets typically pass to the other tenants listed on the documents and effectively avoid probate. Accordingly, the Small Estate Affidavit is not necessary to collect such nonprobate assets.
2) The Affidavit is not effective until after the expiration of thirty days from the date of the applicable decedent’s date of death.
Neb. Rev. Stat. §30-24,125(a). Keep in mind that this again applies to probate assets (assets solely in the name of the decedent) and not nonprobate assets. Nonprobate assets should pass to the joint tenant or beneficiary immediately upon death by operation of law.
3) This is especially important. The Nebraska Small Estate Affidavit only applies if the total of all probate assets (assets owned solely in the name of the decedent) are equal to or less than $100,000.
Thus, if a decedent’s probate assets have a combined value more than $100,000, the filing of the decedent’s Will with an applicable probate court is necessary and the decedent’s estate (the Estate) will need to engage an attorney to file for probate with the Court. If probate assets are more than $100,000 and the decedent did not possess a Will, then the attorney can represent the Estate with the probate court through an intestate succession proceeding. That event is beyond the scope of this presentation.
4) Determining the valuation of assets at date of death is of important consequence.
While addressing the $100,000 threshold of the Small Estate Affidavit is key, there are extremely important and invaluable issues with respect to the step-up-in-basis attributes of decedent’s assets that typically come into play for real estate, stocks, bonds, business interests, etc. For guidance on asset inventory and valuation, please click here.
If the Nebraska Small Estate Affidavit is still in play, then it is vital to identify who can execute the Affidavit and collect the related assets. Normally, the decedent’s Will identifies who is to inherit the decedent’s (probate) assets. If the decedent did not possess a Will, then Nebraska’s intestate succession laws may determine who is to inherit the related assets. For more on Nebraska intestate succession, please refer to a Nebraska probate attorney or reach out to us.
Assuming that you are the stated beneficiary under the decedent’s Will, and assuming that no probate proceeding exists with an applicable probate court, then you should have the ability to complete and execute the Small Estate Affidavit. Keep in mind that the execution of such Affidavit is under Nebraska’s perjury laws. Neb. Rev. Stat. §28-915.
The effect of the Affidavit is for banks, brokers, title companies, registers of deeds, agents, etc., to recognize the Affidavit as the legal document and authority to claim the respective asset(s).
The Affidavit, when legally in effect, carries the same weight and power as the Letters of Personal Representative that are used in probate estate cases. As referenced in the Affidavit, financial representatives, etc., are to rely on Neb. Rev. Stat. §30-24,126 for legal reference and authority.
5) Next, and perhaps, most importantly, one must sign the Affidavit before a licensed Nebraska notary.
The Notary can execute and date the Affidavit immediately after you execute your signature. Because it is often difficult to locate or identify a notary, we direct you to www.nebraska-notary.com.
The State of Nebraska Judicial Branch of the Nebraska Supreme Court offers an additional reference to the Nebraska Small Estate Affidavit (found here) if you have questions or concerns.
Be aware that the transfer of assets from a decedent may involve certain federal estate tax, Nebraska Inheritance Tax, the decedent’s final income tax return, and certain estate fiduciary income tax return issues. For guidance on any and all, please contact us and we can help.
Please know that laws change. Accordingly, it is important to know that some of the details presented above are subject to any law changes from time-to-time.
For example, the $100,000 threshold used to serve as $50,000 prior to July 2022. To ensure that you are following the current rules, please refer to a Nebraska probate attorney or contact us today.