If you’ve found your way to this article, you might be handling the recent passing of a parent or family member. We extend our deepest sympathies during this difficult time. Loss is an indescribable emotion, and we sincerely hope that the answers to some of our Frequently Asked Questions below can provide some guidance as you navigate through the process.

Disclaimer: The information provided is intended for informational purposes only and should not be construed as legal advice.

Going to Court to Administer a parent’s estate

It is best to begin by assessing your parent’s assets. Specifically, consider whether there are any probate assets, which means assets held solely in your parent’s name. If there are assets with joint ownership and rights of survivorship, or if there are contracted beneficiaries, these are non-probate assets and they will typically transfer somewhat automatically to the joint owner or the named beneficiary. While your parent was alive, having a bank account titled solely in their own name granted them the authority to deposit and withdraw funds. However, if there’s no joint owner or agent designated through a Power of Attorney, they remain the sole person authorized to transact on that account. Now that they have passed, there’s no living individual with the authority to manage their account unless a person possesses a court order. This is why administration is required to go through the Surrogate Court.

When an individual passes away with a valid Will, that Will designates an “Executor” who assumes the authority to manage the deceased’s affairs. This Executor has the option to either accept or decline the position through legal proceedings with the Surrogate Court, ultimately obtaining the necessary court order.

In contrast, when someone dies without a Will (intestate), the State steps in. State laws prescribe a specific order of priority for individuals eligible to apply for the role of “Administrator.” Both Executors and Administrators share similar responsibilities, the only difference is that an Executor is to act in accordance with the Will and an Administrator is to act in accordance with state laws on inheritance. Exceptions exist, but generally, if there are no probate assets, the probate process with the Surrogate Court becomes unnecessary.

Establishing an Administrator

In New Jersey, the first preference is given to the spouse (or registered domestic partner) of the deceased person. If there is no spouse, then all of the next surviving heirs (such as children, parents, siblings, etc.) can be Co-Administrators if they agree. For example, if a parent dies without a spouse and has three children, all three can be Co-Administrators. But if any child declines, the others can still be Administrators. If no heir wants to be an Administrator, anyone can apply for it.

How to Become the Administrator

The Surrogate Court will ask you to complete an information sheet and will give you forms to sign. More often than not, the Surrogate Court will ask you to obtain a surety bond before they will grant you the authority to act.

The Need for a Bond

The bond is akin to an insurance policy and are usually issued by insurance companies, however they don’t provide coverage to you as the Administrator but rather to the people entitled to inherit from the estate. It protects them if you make a mistake as the Administrator. The bond is a financial guarantee by the company that if the Administrator does not administer the estate properly and the heirs have damages, then the surety company and the administrator will be liable for those damages. Because of this financial guarantee, the person applying for administration must be credit worthy and there is a fee (“premium”) to be paid annually to keep the bond active until the estate is closed.

Adminstrator Duties

Once you have been appointed as the Administrator, then you will be given Administrator Certificates which prove that you have the authority to transact on the accounts that are in your parent’s sole name. You will take these to the banks and brokerage firms where the decedent held accounts and will be able to close those accounts and move them to an estate checking or brokerage account. You will also be responsible for using those funds to pay the final debts and bills and for filing your parent’s final income tax returns, as well as any estate income tax returns. It is important to note that if any property passes to a person outside of the immediate family (i.e. their parent, spouse, children or grandchildren) there might be inheritance tax due on that transfer and you would be responsible

After all the debts are paid and all accounts have been closed and moved to the Estate you will be ready to make distributions. But to whom? Again, the State laws on intestacy will determine who gets to inherit and how much they get. The New Jersey statute can be a bit tricky to navigate, especially if there are no children to inherit. Generally, if your parent and their spouse had children together and your parent had no other children with any other person then the spouse would be entitled to 100% of the estate. If you have half-siblings on your parent’s side, then there is a statutory formula to determine how much the spouse received and how much the children receive.

Cancelling the Bond

When it comes time to make distributions, each heir will need to sign a document called a Refunding Bond and Release which evidences that they have received their share of the inheritance, they release the Administrator from their duties, and they agree that if a valid debt is due and payable after receiving their inheritance they will pay back their proportionate share to cover the debt.  Once the Refunding Bond and Releases are filed with the Surrogate Court, the company that issued the bond will need to be notified to release the bond.

Becoming an Administrator of an estate in New Jersey can be a complex and time-consuming process, but it doesn’t have to be. It is advisable to consult a lawyer who can guide you through the legal requirements and procedures. A lawyer can also help you avoid any potential pitfalls or disputes that may arise during the administration of the estate.

Frequently Asked Questions (FAQs)

1. What does it mean if a parent dies without a will in New Jersey?

When a parent dies without a valid will, they are considered to have died “intestate.” This means New Jersey state law determines who inherits their assets and who has the authority to administer the estate.

2. Do I need to go to court if my parent died without a will?

It depends on the assets involved. If your parent owned assets solely in their name (probate assets), court involvement through the New Jersey Surrogate’s Court is usually required to appoint an Administrator. If all assets were jointly owned or had named beneficiaries, court involvement may not be necessary.

3. What assets go through probate in New Jersey?

Probate assets typically include bank accounts, investments, or property held solely in your parent’s name without a designated beneficiary. Assets held jointly with rights of survivorship or with named beneficiaries generally pass outside of probate.

4. Who can be appointed as the Administrator of the estate?

New Jersey law gives priority to the surviving spouse or registered domestic partner. If there is no spouse, the next surviving heirs, such as children, may serve as Administrator(s). If no heir wishes to serve, another individual may apply.

5. Can more than one person be an Administrator?

Yes. If there is no surviving spouse, multiple heirs (such as siblings) can serve as Co-Administrators, as long as they agree. If one heir declines, the others may still serve.

6. What is the difference between an Executor and an Administrator?

An Executor is named in a will and follows the instructions in that will. An Administrator is appointed by the court when there is no will and must follow New Jersey’s intestacy laws when distributing assets.

7. Why does the Surrogate Court require a surety bond?

A surety bond protects the heirs and beneficiaries of the estate. It acts as a financial guarantee that the Administrator will properly handle estate assets and fulfill their legal duties.

8. What are the responsibilities of an Administrator in New Jersey?

An Administrator is responsible for collecting estate assets, paying debts and expenses, filing required tax returns, and distributing the remaining assets according to New Jersey intestacy laws.

9. Who inherits when a parent dies without a will in New Jersey?

Inheritance depends on family circumstances. In many cases, a surviving spouse may inherit all or most of the estate. If there are children from multiple relationships or no surviving spouse, New Jersey law applies specific formulas to determine each heir’s share.

10. How is the estate administration completed and the bond released?

After all assets are distributed, heirs sign Refunding Bonds and Releases confirming receipt of their inheritance. Once these documents are filed with the Surrogate Court, the surety bond can be released and the estate closed.

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