Successions

by Ronda M. Gabb*, JD, RFC
*Board Certified Estate Planning and Administration Specialist

Succession, also known as Probate, is a legal process whereby we transmit title and ownership of a deceased person’s assets to the proper recipients.  If there are any inheritance taxes due, they are paid as part of the succession process.  If the decedent left a Will then the procedure is called a “testate succession” and the Will is probated (i.e., proven).  The succession process transmits ownership to the proper recipients (called legatees under the Will).  If the decedent did not have a Will, it is called an “intestate succession” and Louisiana law steps in to determine the rightful recipients (called heirs).

You must open a succession within nine months of the date of death in order to take advantage of the Louisiana Inheritance tax repeal (since 7/1/2004).  This now means that if a succession is timely opened, THERE ARE NO INHERITANCE TAXES DUE THE STATE OF LOUISIANA!  If the decedent’s assets were $2,000,000 or less (2007 figure), then no Federal Estate Taxes are due either.  If the succession was not timely opened, or if the decedent died prior to 7/1/2004, Louisiana’s Inheritance Taxes are not so easy to compute.  Each class of recipient has a different exemption amount.  For example, a spouse is totally exempt (but only since 1992), each child has a $25,000 exemption, and a non-related party only gets a $500 exemption.  The tax rate ranges from 2% to 10%, depending on the estate’s value and the relationship to the decedent.  Penalties and interest begin to accrue after the ninth month of the date of death, regardless of whether or not a succession has been opened. 

A succession must also be completed (or at least opened) in order to sell any property that the decedent owned.  This is true even if the decedent’s Will left all of his property to his spouse.  If property is being sold, the succession is needed to change title on that property from the deceased husband’s name to the wife’s name only (or to the children with a “usufruct” to the wife if there was no Will).  The final and most important document issued in a succession is called the “Judgment of Possession.”   It acts as a “deed” to transfer title to real estate, or to transfer title to vehicles, bank accounts, stocks, brokerage accounts, business interests, etc.