Oftentimes people will inherit money from a loved one who has recently passed and presume that they can spend it immediately. While it might be hard not to spend the inherited money, that might not be the wisest thing to do.
There are rules and timelines in Missouri that exist for the protection of both creditors and loved ones. Missouri law provides that most creditors have up to 18 months from a person’s date of death to try and recover assets that were distributed to the person’s family by a nonprobate transfer (R.S.Mo. § 461.300.2). This is an example of why I instruct people to hold onto the money until probate has been completed or the 18 month period has passed.
For example, let’s pretend that John Doe has no spouse and one adult child at the time of his death. John designated his son as beneficiary for all possible nonprobate transfers (his bank accounts, CDs, stocks, bonds, etc.). John’s son never had the estate administered in a probate court. John’s son could be held responsible for debts up to the amount that was distributed. If John left $50,000.00 to his son and a hospital bill of $100,000.00, John’s son could be responsible for $50,000.00 of the debt. This would have to take place within the 18 month window following John’s passing.
This is just one of a countless number of scenarios that could happen when someone passes. Even if you feel that there is no need to go through probate court, it is almost certainly worth your time. An experienced probate attorney can explain your rights and obligations to you.
Thank you for taking the time to read this. Feel free to contact my office for a free consultation.