Determining the type of estate you’re dealing with in Maryland is essential. Doing so takes three steps and moves the estate you’re handling into a regular estate or small estate category. Taking this action is important as there are different forms and steps to follow with each one.
Step 1 includes adding each asset to a list
Assets to include on the descendent’s property list going into the estate should only include probate property. Knowing the value of personal and real property is important. Personal property, such as vehicles, furniture and jewelry, must have each value determined. Recording the value of any real property, such as land or a house, must also be completed.
Step 2 involves adding each debt to a list
When determining if the small estate or regular estate category should be used, knowing the debts of the descendent is critical as each one will be deducted from their associated asset. For example, if there are any liens on the descendent’s property, they must be subtracted from the total value to determine the actual financial interest held in the property by the descendent.
Step 3 determines the net value
Knowing how to move forward and categorize the estate correctly is done by determining the net value of the descendent’s estate. To perform this equation, the total amount of secured debts must be subtracted from the total value of assets held by the descendent.
After this step is completed, the estate will be placed in the “regular estate” category if the net worth is more than $50,000. If the net value is equal to $50,000 or less, the estate is considered a “small estate.” However, if a spouse is the only heir, the total net value can equal $100,000 or less to be considered a small estate. Following each step is critical to ensure you determine the appropriate category for the estate’s total value.