Probate Glossary

What Do Different Legal Words Mean?

You may see or hear the following terms used in connection with a deceased person’s estate. This is a probate glossary of common words.

If you’re confused about all the different legal words like “probate,” “personal representative,” “trustee,” you’re not alone.

 

Annual Exclusion A present interest gift that may be given each year to any number of individuals without being subject to federal gift tax.  In 2022, this amount was $16,000 for a single person or $32,000 for a married couple.  It will adjust periodically based on inflation.
Annuity A contract to pay an income from a stipulated date until either the death of the annuitant(s) (the person who purchases the annuity) or a specific date in the future.
Beneficiary The person to whom the proceeds of a life insurance contract or retirement plan benefit are payable following the death of the insured or the person designated to receive all or a portion of a trust or estate.
Bequest A gift made under the will.  It can be a particular item of the estate (specific) or one that may be satisfied out of the general assets of the estate.
Cash Value The amount of cash available to the life insurance policy owner when a policy is surrendered to the insurance company.  It is also may have been used as collateral when loans are made against a policy during the deceased person’s lifetime.
Codicil A document that amends an existing will.
Community
Property
Property owned by a husband and wife in a community property state such as Arizona.  This type of property is considered belonging one-half to the husband and one-half to the wife.
Contingent Beneficiary A secondary beneficiary who will receive any policy proceeds or portions of a trust or estate remaining unpaid upon the death of the direct beneficiary.
Corpus The property transferred to a trust.
Devise A transfer of real estate under a will, as distinguished from a bequest of personal property.
Disclaimer Refusal of a beneficiary to accept property to which the beneficiary is entitled under a will or trust.
Donee Person who receives a gift.
Donor Person who makes a gift.
Estate Tax A tax on the net fair market value of assets of a person who has died.  Imposed by the federal government and by many states (but not Arizona).
Executor Arizona does not use this term. But you may hear others use it because they are familiar with the law of another state. This is essentially the same as a Personal Representative, which is the person appointed by the probate court to manage an estate.  See personal representative later in the probate glossary.
Executrix Another name for a female personal representative. See personal representative further down in this probate glossary.
Fiduciary One occupying a position of trust.  For example, a personal representative, administrator, or trustee.
Grantor A person who creates a trust; also called settlor, creator, donor, or trustor.
Inheritance Tax A tax on the right of heirs to receive property from a deceased.  As distinguished from an estate tax, the inheritance tax is a tax on an heir’s right to receive, rather than the value transferred by the deceased person.
Insurance Trust A trust that owns life insurance.  The trust may be the original applicant for the insurance, purchase existing insurance or receive policy(s) by gift from the insured.
Intestate One who dies without a will or with an invalid will.
Joint Tenancy Property held by two or more persons with rights of survivorship.

Letters of

Administration

Same as Letters Testamentary except issued for estates in which the deceased person did not have a will.

Letters

Testamentary

Letters issued by the Superior Court clerk to a personal representative appointed under a will, as soon as the personal representative has been appointed and has qualified.  Often required to prove the personal representative’s authority to transfer assets.
Living Trust A trust created during the grantor’s lifetime.  If the trust can be changed by the grantor, it’s revocable. If it cannot be changed by the grantor, it’s irrevocable.
Marital Deduction A deduction that allows up to 100 percent of a deceased spouse’s estate to be passed to the surviving spouse without being subject to federal estate tax.
Medical Examiner Public officer whose principal duty is to inquire as to the cause of death; often called a coroner.

Personal

Representative

This is the official term in Arizona for a person named in a will to manage an estate.  This person collects assets, pays debts and taxes, and distributes property under the will terms.  See executor.
Policy Owner The individual or trustee who has the right to exercise control over a life insurance contract.
Proceeds of a Policy The net amount of money payable by the company at the death of an insured or at the maturity of a policy.
Probate The process of proving the validity of a will in court and executing its provisions under the guidance of the court.  Also, the process of identifying and notifying creditors.
Probate CourtThe court that hears estate probate (for transferring assets after someone dies with a will) and intestate matters ((for transferring assets after someone dies without a will). It also handles a variety of other cases in the areas of guardianship, conservatorship, elder fraud, and physical abuse.
Residuary Estate The remaining part of a deceased’s estate after payment of debts and specific bequests, legacies, and devises.
Special Administrator A person appointed by the court to manage an estate prior to the appointment of a Personal Representative. The Special Administrator’s role is to collect and secure the estate. He or she cannot make distributions to heirs.

Tenancy In

Common

Property held by two or more persons without rights of survivorship.
Testamentary Trust A trust created under the deceased’s will.  It comes into being shortly after the grantor’s death.
Testator A person who makes a will.  This person dies testate.
Trust A legal relationship among a trustor, a trustee, and one or more beneficiaries.  A trustor is a person who establishes a trust by transferring legal title of specific assets to a trustee.  A trustee is the legal owner of the property and must manage the trust property for the benefit of a beneficiary named in the trust agreement or trust provisions in a person’s will.  A trustee must follow the instructions of the trust document.  A beneficiary is entitled to the benefits of the trust and is usually an individual, but can be any other legal entity (e.g., charitable institution).

So, there you have it. That is our probate glossary of common words used in estate planning and when a person dies. If you have any questions, just give us a call at 602-443-4888. We’re here to help.

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Founding attorney Paul Deloughery has been an attorney since 1998, became a Certified Family Wealth Advisor. He is also the founder of Sudden Wealth Protection Law.

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