Lawyers are notorious for using Latin and legal terms that are unfamiliar to most people. Fraser Law Firm’s attorneys use plain English as much as possible. However, the law is sometimes complicated, and there are words that they use frequently that everyone may not understand. This glossary includes only estate and trust terms. Powers of attorney, health care directives, Medicaid planning, and death taxes terms have been omitted. A glossary of terms pertaining to health care directives is located at the end of our page entitled "Health Care Decisions."
On April 1, 2000, a new law went into effect called the "Estates and Protected Individuals Code" (commonly called "EPIC"). This new law replaced the Michigan Probate Code that had previously been in effect since July 1, 1979. EPIC also changed some of the terminology and the definitions of certain words used in estate planning.
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In the definitions, words that appear in italics are words that also appear in the glossary.
Administration: the process of handling the affairs of a deceased person's estate or a trust.
Administrator: the person or financial institution that is appointed to take care of the estate of a deceased person who died without a will. This term is now obsolete in Michigan. The position is now called "personal representative."
Adult: in Michigan, a person who is 18 years of age or older.
Ancillary Administration: probate proceedings in another state. This is usually necessary when the deceased person owned real estate in a state other than his or her home state.
Assets Subject to Administration: this refers to those assets that are subject to administration in the probate court, i.e., those assets that were in the name of the deceased person only. Sometimes these assets are referred to collectively as the "estate." Assets owned jointly with a surviving joint owner, life insurance proceeds, and retirement plan proceeds payable to a named beneficiary other than the estate are normally not part of the estate because they are not subject to administration.
Beneficiary: a generic term that usually refers to a person or entity that is entitled to receive something, for example, a beneficiary of an estate or trust, or a beneficiary of life insurance or retirement benefits.
Claim: technically, this refers to funeral expenses, the debts of a deceased person, and expenses of administration.
Codicil: a written amendment to a will.
Conservator: an adult person or financial institution appointed by a court, who is responsible for a minor child's or legally incapacitated person’s property until that minor child becomes an adult or the legally incapacitated person becomes competent to be responsible for his or her own property. In some states this position is referred to as "guardian of the estate."
Devise: when used as a noun, it refers to an inheritance of real or personal property under a will. When used as a verb, it means to dispose of real or personal property by will.
Devisee: a person or entity designated in a will to receive a devise.
Domicile: one's home or permanent residence. The laws of the state of a person's domicile determine what happens to that person's property at death.
Donee: the recipient of a gift.
Donor: a person who makes a gift. This term is also used to refer to a person who establishes a living trust.
Escheat: assigning property to the state when a person dies with no known beneficiaries or heirs.
Estate: this word has a number of meanings depending on the context in which it is used. For federal estate tax purposes, it refers to all of a deceased person's assets that are included in that person's estate for tax purposes. It is also used to refer to those items of property that are subject to administration in the probate court. For example, life insurance owned by the decedent and payable to a named beneficiary such as a surviving spouse is not part of the deceased person’s estate that is subject to administration in the probate court, but it is included in the deceased person’s estate for federal estate tax purposes.
Estate Planning: the process of arranging one's personal and financial affairs.
Executor: the person or financial institution that is appointed to administer the estate of a deceased person who died with a will. This term is now obsolete in Michigan. This position is now called "personal representative."
Exempt property: in Michigan this refers to the right of a surviving spouse to receive from his or her deceased spouse's estate that is subject to administration property up to $12,000 (in 2006). A surviving spouse is also entitled to a homestead allowance and a family allowance.
Family Allowance: an allowance that a surviving spouse is entitled to from his or her deceased spouse's estate that is subject to administration for a period of one year during the period of administration of the estate. This is not a set amount but is to be a reasonable amount payable to the surviving spouse and minor children. A personal representative may determine the family allowance without a court order if the family allowance does not exceed $22,000 (in 2006) for the year. A surviving spouse is also entitled to exempt property and a homestead allowance.
Fiduciary: comes from a Latin word meaning trust and confidence. This is a generic term used to refer to a person (or entity) that serves in a representative capacity. Personal representatives, trustees, guardians, conservators, and agents under powers of attorney are all fiduciaries. A fiduciary stands in a position of confidence and trust with respect to each heir, devisee, and/or beneficiary.
Formal Probate: a proceeding before a probate judge to determine whether a decedent left a valid will.
Formal Proceeding: a proceeding usually started by a petition or motion and culminating in a hearing before a probate judge after notice to interested persons.
Grantor: in a trust context, this refers to a person that established a living trust. It is also used to refer to one who is transferring real estate in a deed.
Guardian: an adult person appointed by a surviving parent in his or her will or by a court, who is responsible for a minor child or legally incapacitated person's personal care and nurturing.
Heir: person, who inherits property from the estate of a deceased person who died without a will.
Homestead Allowance: in Michigan, this refers to a surviving spouse's right to receive $18,000 (in 2006) from his or her deceased spouse's estate. A surviving spouse is also entitled to exempt property and a family allowance.
Informal Probate: a proceeding before the probate register to admit a will to probate.
Informal Proceeding: a generic term that refers to a proceeding conducted by the probate register to admit a will to probate or appoint a personal representative or both. This is normally done without a hearing in the courtroom and without prior notice to interested persons.
Intangible Personal Property: property one cannot physically touch. This type of property may have some paper associated with it. This type of property usually includes such items as stock, bonds, mutual funds, bank accounts, and cash.
Inter Vivos Trust: see living trust below.
Intestate: refers to dying without a will.
Irrevocable Trust: a trust that can no longer be amended or revoked by anyone. Most revocable trusts become irrevocable at some time, for example, when the person who established the trust dies.
Legally Incapacitated Person: a person who has been determined by a court as not capable of handling his or her personal and financial affairs.
Letters Of Authority: the paper that is issued by the probate register or the judge to a personal representative, showing that the personal representative has the authority to act on behalf of an estate.
Living Trust: a trust that one establishes during one's lifetime which is not part of one's will, but is usually established by a separate written trust agreement. The same as "inter vivos trust." This type of document is also sometimes referred to as a revocable living trust.
Minor: in Michigan, a person who is under the age of 18.
Personal Representative: the person or financial institution appointed by the probate register or the court to administer a deceased person’s estate.
Probate: the process of determining if the deceased person left a valid will and admitting that will to probate. When a will is "admitted to probate" it means that the probate register or the probate judge has signed a paper that says the will is admitted to probate. The paper that the probate register signs is called a "register’s statement" and the paper that the judge signs is called an "order."
Probate Register: an employee of the probate court authorized to perform certain acts such as the admission of a will to probate in an informal proceeding.
Proceeding: involves the court in some type of activity such as the admission of a will to probate in an informal proceeding conducted by the probate register (this may be done by mail and does not involve a court hearing) or in a formal proceeding conducted by the judge in a hearing in the courtroom after proper notice to interested persons.
Revocable Living Trust: a living trust or inter vivos trust that can be amended and revoked, usually by the person who established the trust. This trust may become irrevocable and unamendable when the only person who can amend or revoke the trust dies or becomes incompetent.
Settlor: a person who established a living trust.
Spouse's Allowance: see family allowance above.
Statutory Will: a form of will drafted by the Michigan Legislature and contained in a statute. It is intended to be available to someone who doesn't want to use a lawyer. Please be very careful when using this type of will.
Supervised Probate: a proceeding for the administration of a deceased person's estate in which there is considerable court involvement. There are papers that have to be filed with the court and various types of hearings before the probate judge.
Tangible Personal Property: property that you can touch, such as cars, dishes, jewelry, tools, guns, sporting equipment, etc.
Testamentary Trust: a trust that is part of a person's will.
Testate: refers to dying with a will.
Testator: a person who makes a will.
Trust: an arrangement, usually established by a written document, to provide for the management and disposition of assets. It normally involves three parties: the person who establishes the trust (sometimes called a donor, grantor, settlor, or trustor), a trustee, and one or more beneficiaries.
Trustee: an adult individual or financial institution that is designated to be responsible for the administration of a trust. There may be more than one trustee (co-trustees), and an individual and a financial institution may serve as co-trustees.
Trustor: see settlor above.
Unsupervised Administration: that portion of the administration of a deceased person’s estate in which the personal representative performs various duties without being supervised by the probate court. For example, the personal representative may pay claims, sell real estate and personal property, and make distributions to the beneficiaries without any court involvement.
Will: a written document which disposes of one's property at death. The will also is used to nominate personal representatives. It may also be used to express burial and funeral instructions, make anatomical gifts, and designate a guardian and conservator for a minor child or an legally incapacitated adult.
This glossary is intended as a source of general information. If you have questions or desire additional information, please contact Ryan M. Wilson at (517) 377-0897 or rwilson@fraserlawfirm.com.