What counts toward the small estate limit?

The underlying principle

There is one idea underneath all of this, and once it clicks the rest follows:

This is why an estate that looks like $400,000 on paper is frequently a $12,000 probate estate. The house was held jointly. The 401(k) named the spouse. The life insurance named the children. What is actually left for probate is one checking account and a car.

What counts

• Solely-owned bank accounts with no payable-on-death beneficiary.
• Final wages, accrued leave and unpaid commissions owed by an employer.
• Vehicles titled in the person’s name alone, where the state counts them, many don’t.
• Personal belongings: furniture, jewellery, tools, household goods, at realistic second-hand value, not replacement cost. Ordinary household contents are usually worth far less than people estimate.
• Stocks and securitiesheld in the person’s own name with no transfer-on-death registration.
• Money owed to the deceased, a tax refund, a security deposit, a final utility credit, a personal loan they made.
• Life insurance payable to the estate, rather than to a named person.
• Real property, but only in the states that include it, and often only above or below specific thresholds.

What doesn’t count

This is the list that changes the answer for most families:

• Jointly-held property with right of survivorship, accounts, real property, vehicles. It passed to the survivor at the moment of death.
• Payable-on-death and transfer-on-death accounts with a living beneficiary.
• Life insurance with a living named beneficiary.
• Retirement accounts: 401(k), IRA, pension, with a living named beneficiary.
• Property held in a living trust. The trust owns it, not the person.
• Property subject to a transfer-on-death deed.
• Community property with right of survivorship, in the community property states.
• Statutory exempt property and family allowances, in many states, a set-aside for the surviving spouse and minor children that comes off the top.
• The homestead, in the states that exclude it specifically.

Gross or net?

A correct dollar figure measured on the wrong basis is still a wrong answer, and states genuinely differ:

• Gross value. Total value with no deduction for debts or liens. A car worth $18,000 with a $16,000 loan counts as $18,000.
• Net value. Value less liens and encumbrances. The same car counts as $2,000, which can be the difference between qualifying and not.
• A statutory formula. Several states specify their own calculation, deducting particular categories such as funeral expenses, last-illness costs or the family allowance.

Each of our state pages states the basis explicitly next to the number, because the two only mean something together.

A worked example

A widow dies leaving what the family describes as “about $350,000”:

The probate estate is $13,250, or $20,350if the state counts the car. Either figure is comfortably under most states’ limits. The family that heard “$350,000” and called a probate attorney was about to spend four figures unnecessarily.

Common mistakes

• Counting the house reflexively. Check how it was titled, and check whether your state includes real property at all.
• Valuing belongings at replacement cost. The measure is what the items would actually fetch, which for ordinary household goods is very little.
• Forgetting liens in a net-value state, and so overstating a financed vehicle by the whole loan balance.
• Including the life insurance that pays directly to a named child.
• Missing an old account. Errs the other way, and it matters: an account that surfaces later can push the estate over the limit after you have already sworn it was under.

Our eligibility checkapplies your state’s specific inclusions and exclusions rather than a generic rule, and shows you which ones it applied.