Michigan Inheritance Laws

A recent report from the Michigan Courts paints a clear picture: estate matters are a major focus for the state's probate system. In 2021 alone, probate courts handled 24,343 estate administration cases and 5,341 small estate cases. These figures, respectively, represent 32.51% and 7.13% of the total caseload handled by these courts.

This data highlights the significance of estate planning for Michigan residents. By creating a will, individuals can ensure their wishes are met and that their assets are distributed according to their intentions, reducing potential complications for loved ones during a difficult time.

However, navigating probate, even with a will, can be tedious. Understanding relevant laws is essential to avoid errors that may lead to complications. With that in mind, this article discusses what happens when a Michigan resident passes away, regardless of whether they have a will. It provides a detailed overview of the inheritance process.

What Happens if Someone Dies With a Will in Michigan?

When someone in Michigan dies, their belongings and assets (their estate) are distributed according to their last wishes, as outlined in their will. However, the will must be officially recognized before those wishes can be carried out.

For a will to be valid in Michigan, the person making it must be at least 18 years old and mentally competent. This means they:

• Understand the purpose of a will, which is to plan how their property will be distributed after their death.

• Grasp the consequences of signing a will.

• Are aware of the extent of their assets.

• Recognize their immediate family members.

In Michigan, a valid will must be signed before two witnesses, who must also sign the document within a reasonable timeframe after the testator. While the law allows interested parties (those who stand to benefit from the will) to act as witnesses, it is generally discouraged because it can open the door to future challenges.

Regular wills in Michigan do not need to be notarized. However, "self-proving" wills, which can be processed without contacting the witnesses, must be notarized. Both typewritten and handwritten wills are acceptable in Michigan. However, handwritten wills are more likely to be contested due to potential concerns about authenticity. As for electronic wills, they are not currently recognized in the state.

Contesting a Will

Individuals with a stake in the deceased's estate, including potential heirs and beneficiaries from previous wills, have the right to contest a will. This process seeks to invalidate the current will and potentially alter the distribution of assets.

The deadline for filing a contest depends on how the court admits the will. In formal probate, contests must be filed before the court accepts the will. Once the court issues an order validating the will, interested parties have 21 days to appeal. If no appeal is filed within this timeframe, additional contests are prohibited. While no official deadline exists for contesting informal wills, delays can decrease the chances of success.

To successfully contest a will, you must have a valid legal reason. These include:

• Invalidity: The will does not meet the legal requirements for validity.

• Fraud or misrepresentation: The testator was deceived or misled when making the will.

• Undue influence: A third party exerted pressure on the testator, affecting their decision-making.

• Forgery: The will is a fake document.

• Superseding will: A newer, valid will exists, overriding the contested one.

Michigan’s Probate Process

Probate in Michigan typically takes around seven months or longer, but several factors can impact the duration. These include the time needed to find the will, resolve creditor disputes, and settle will contests.

There are two main types of probate: formal and informal. Informal probate is generally faster and cheaper, but it is not suitable for highly contested wills. Additionally, a simplified process exists for small estates valued at $27,000 or less (as of 2023).

The following sections will discuss the general steps involved in Michigan’s probate process.

1. Accomplish and File the Forms

To begin the formal probate process, you must complete and file a Petition for Probate and/or Appointment of Personal Representative form with your local probate court. You must also submit the original or authenticated copy of the will, as well as a certified copy of the decedent’s death certificate. Expect to pay a $175 filing fee.

For the informal probate process, an Application for Informal Probate and/or Appointment of Personal Representative form must be filed instead.

2. Appoint a Personal Representative

If someone has been unofficially named as the personal representative before you file your petition, you can still ask the judge to appoint someone else instead. The previously appointed personal representative cannot act on behalf of the estate until the judge makes a decision.

The personal representative must be chosen carefully, as they must fulfill the following obligations:

• Making an inventory: They must create a list of all the deceased person's assets and pay a fee to file it.

• Filing taxes: They must file the deceased person's final tax return and pay unpaid taxes.

• Paying debts and bills: They must handle claims against the estate and pay outstanding bills.

• Notifying creditors: They must notify all known and unknown creditors, either by letter or by public announcement.

• Asset distribution: They must distribute the remaining assets to the beneficiaries according to the judge's instructions.

If the estate has been open for over a year, the personal representative is also in charge of filing a Notice of Continued Administration.

3. Notify Interested Parties

You have three options for serving notice:

• First-class mail: You can mail the notice via first-class mail at least 14 days before the hearing date. This deadline ensures the interested party has ample time to receive and respond to the notice.

• Personal delivery: Alternatively, you can deliver the notice to the interested party at least seven days before the hearing. This method provides the most immediate notification but may require more effort on your part.

• Publication in a local newspaper: If the interested party's address is unknown, you must publish a notice in a local newspaper at least 14 days before the hearing. This ensures that the interested party receives notice, even if their address is not readily available.

The following individuals are considered interested parties and should receive notice:

• All the decedent's heirs: These are the individuals who inherit the decedent's property according to state law, regardless of whether they are named in the will.

• Devisees named in the will: These are the individuals specifically named in the will as recipients of specific property or assets.

• Trustees of the decedent's trust: If the decedent established a trust, the trustees are responsible for managing the trust assets and should be informed of legal proceedings related to the estate.

• Any individual who filed a demand for notice: Any person who believes they have a legal interest in the estate can file a demand for notice and must be aware of any hearing.

4. Attend Hearings

This step takes place only in the formal probate process. The duration and frequency of probate hearings depend on whether the will is contested. Disagreements on smaller assets tend to be resolved faster, while disputes on larger assets can take multiple hearings to be resolved.

The judge will eventually issue an Order of Formal Proceedings, and you, the personal representative, must sign an Acceptance of Appointment before handling the estate.

5. Close the Estate

Before an estate can be closed, creditors must have been notified at least four months prior to the closing. Proof of payment for all applicable taxes is also required. The estate needs to have been open for at least five months before it can be closed.

For formal probate, once the period for presenting claims elapses, you must file a Petition for Complete Estate Settlement.

Exempted Assets

In Michigan, some assets do not need to go through the probate process. Consequently, they are not subject to court oversight and can be transferred to beneficiaries more quickly. When calculating the total value of an estate, it is important to exclude the following:

• Jointly owned assets: These comprise any property that the deceased individual owned in joint tenancy with another person, such as a spouse or a child. In these cases, ownership automatically transfers to the surviving owner(s) upon the testator's death.

• Tenancy by entirety: This is a type of joint ownership specific to married couples in Michigan. Assets held in tenancy in their entirety are automatically transferred to the surviving spouse upon the death of the other.

• Beneficiary-designated accounts: These include financial accounts, insurance policies, and retirement plans. Upon the owner's death, the assets pass directly to the named beneficiary, bypassing probate.

• Revocable living trusts: These are designed to hold assets during the owner's lifetime and then distribute them to beneficiaries after death, avoiding probate altogether.

• Payable-on-death accounts and transfer-on-death vehicles: These allow the owner to designate a beneficiary who will automatically inherit the asset upon the owner's death, bypassing probate.

Processes for Small Estates

Assignment of Property

The process of assigning property is available to heirs or the individual who paid the decedent's funeral expenses. To initiate this process, a Petition for Assignment form must be submitted with a $25 filing fee. Moreover, an inventory fee will be assessed based on the property's value. Upon completion of these steps, the funeral and burial expenses will be reimbursed.

Transfer by Affidavit

The following conditions must be met to utilize the transfer by affidavit process:

• Real property ownership: The testator must have owned real estate at the time of death.

• Estate value limit: The total value of the decedent's estate, including the real property, must not exceed the state-defined threshold for small estates.

• No pending personal representative: There must not be an existing application for the appointment of a personal representative for the decedent's estate.

To proceed with the transfer, an heir must wait at least 28 days after the testator’s death. They must then sign an affidavit before a notary public and submit it to the property holder, along with a copy of the death certificate. This process transfers ownership of the real property to the heir without requiring formal probate proceedings.

What Happens if Someone Dies Without a Will in Michigan?

In Michigan, when someone passes away without a will, their belongings are distributed according to the state's intestacy laws. Basically, the assets will be given to specific family members in a predetermined order. However, certain assets may not follow these rules. Note that this exception only applies if the intended recipient of those assets has also died. 

Spousal Rights

The intestate share of a surviving spouse can be summarized as follows:

In the presence of a premarital will, the surviving spouse remains entitled to no less than the value they should have received if the decedent had died without a will.

Children’s Rights

While biological children are automatically included in intestate inheritance, specific circumstances can affect their eligibility and share.

Adopted children automatically qualify, but foster and stepchildren must be legally adopted. As for children born out of wedlock, they can inherit from their biological father only under certain conditions:

• Marriage and paternity acknowledgment: The father must have married the child's mother, and both must have signed a legal declaration of paternity.

• Corrected birth certificate: Both parents must have updated the child's birth certificate to include the father's name.

• Parent-child relationship acknowledgment: The deceased and the child must have publicly acknowledged their relationship before the child turned 18.

• Court-determined paternity: Paternity must have been established in a Michigan court.

• Posthumous establishment of paternity: Paternity must have been legally established after the father's death.

Posthumous children must survive for at least 120 hours after birth to receive their inheritance share. Grandchildren can only inherit if their parent (the decedent's child) has passed away.

The Rights of Other Surviving Relatives

In the absence of a spouse or children, the deceased's parents inherit everything. However, this inheritance is subject to certain conditions.

If the parents are also deceased, the inheritance then passes to the deceased's siblings. These inherit per capita, meaning they each receive an equal estate share. Note that only full siblings are considered in this scenario; half-siblings are not entitled to inherit unless specifically named in a will.

Should there be no surviving siblings, the inheritance passes to the deceased's next of kin. The order of succession for next of kin generally follows a descending path through grandparents, aunts and uncles, cousins, and so on.

Estates With No Heirs

In the absence of identifiable surviving family members, a deceased individual's assets will revert to the state through escheatment. In this proceeding, unmarried partners, regardless of their relationship length or commitment to the deceased, are not considered family and have no legal claim to the estate. 

Overall, consulting a legal professional familiar with Michigan's intestacy laws is highly advisable to understand inheritance rights and potential options.

Unique Situations in Michigan Inheritance Law

Michigan has notable ordinances that may differ from other states' inheritance laws. Here are some examples:

• Survivorship: An heir must survive the decedent by 120 hours to inherit property. This ensures that only those demonstrably alive after the decedent's death receive a share.

• Inheritance eligibility: Half-relatives and children born after the decedent's death are eligible to inherit. The law also protects the inheritance rights of relatives, regardless of their immigration status.

• Gifts and advancements: If the decedent gifted a portion of their estate to a relative during their lifetime, that relative's inheritance share may be reduced by the value of the gift. This applies only if the decedent or relative acknowledged the arrangement in writing.

• Vehicle inheritance: In cases where probate is not required and the value of all owned vehicles does not exceed $60,000, the surviving spouse or next of kin can claim the vehicles by submitting a specific form (Certification from the Heir to a Vehicle).

By understanding these key points, individuals in Michigan can better navigate the process of intestate succession.

Does Michigan Impose Inheritance and Estate Taxes?

Inheritance taxes in Michigan were abolished in 1993. However, if the estate includes property from states that still have an inheritance tax, those properties may remain subject to tax. As of 2023, Iowa, Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania are the only states with an inheritance tax.

Due to changes in federal law, Michigan also does not have an effective estate tax. However, an estate can still be subject to federal estate tax if its value exceeds the exemption limit. As of 2023, the limit is $12.92 million. This is portable for married couples, meaning that upon death, their combined exemptions are $25.84 million.

Legal Resources Related to Inheritance Law in Michigan

Ultimately, probate often comes with many expenses, and in most cases, one cannot tap into the decedent’s accounts to ease the financial burden. As such, the following organizations may be helpful to low-income individuals with inquiries regarding Michigan’s inheritance laws.

Free Legal Aid Clinic

The Detroit Free Legal Aid Clinic was established in 1965 and has been offering legal assistance to low-income elderly residents since then. It handles family and elder law matters and resolves guardianship and conservatorship issues. FLAC can also help with the drafting of wills and trusts.

Detroit Bar Association

The Detroit Bar Association has been serving the community since its foundation in 1836. Its legal services clinic connects locals with volunteer attorneys who can answer questions regarding real estate, probate, and other areas of civil law. You can get in touch with them by sending an email to dba@detroitlaywer.org or by calling 313-961-6120.

Lakeshore Legal Aid

Lakeshore Legal Aid is a nonprofit law firm that serves low-income and other disadvantaged individuals in the community. It has over 10 branches across Southeast Michigan, and its offices are open from Monday to Friday, from 8:30 a.m. to 4:30 p.m. You can also set an appointment on Fridays. The law firm addresses concerns related to probate and small estates.