Detailed Answer
Short version: In Utah, money from a sale that belonged to someone who dies without a will generally becomes part of that person’s probate estate and is distributed under Utah’s intestate succession rules unless the funds passed outside probate (for example, by joint ownership, payable‑on‑death/beneficiary designation, or an enforceable contract). Creditors are paid first; remaining proceeds go to the decedent’s heirs under Utah law.
This answer assumes a common hypothetical: a person completes a sale of real estate and proceeds sit with a title company/escrow agent or in the decedent’s bank account when the seller dies without a will. The steps below explain what typically happens and what you should do.
Why the sale proceeds usually go into probate
If the sale proceeds are the decedent’s property (held in their name alone), they become part of the decedent’s estate at death. The personal representative (also called an executor or administrator) of the estate collects estate assets, pays valid creditors and taxes, and distributes what remains to heirs according to Utah’s intestate succession laws. Utah’s probate and intestacy rules are found in the Utah Probate Code (Title 75). See Utah Code, Title 75, Chapter 2 (Intestate Succession) and the probate procedure chapters for the administration process: https://le.utah.gov/xcode/Title75/Chapter2/75-2.html and https://le.utah.gov/xcode/Title75/Chapter3/75-3.html
When the proceeds pass outside probate
Not all sale proceeds will necessarily enter probate. Common nonprobate situations include:
- Joint ownership with right of survivorship — funds in a jointly owned account often pass automatically to the surviving owner.
- Payable‑on‑death (POD) or beneficiary designation on the account holding proceeds — the named beneficiary receives the funds directly.
- Proceeds paid under a contract that specifies a different recipient or contains an enforceable assignment.
- Proceeds placed into an instrument that transfers on death (e.g., certain trust arrangements).
If any of the above apply, the title company, bank, or other holder should follow the contract or account designation and pay the named survivor/beneficiary rather than releasing funds to probate.
How distribution works when the funds are part of the probate estate
- The estate representative is appointed by the probate court (if formal probate is required).
- The representative collects assets (including sale proceeds), gives notice to creditors, and pays valid debts and administration costs.
- After liabilities are satisfied, the remaining assets are distributed to heirs under Utah’s intestate succession priorities (surviving spouse, children, parents, siblings, etc.). See Utah Code, Title 75, Chapter 2: https://le.utah.gov/xcode/Title75/Chapter2/75-2.html
- If no heirs can be found, the estate may ultimately escheat to the State of Utah under state law.
Small‑estate (summary) options
Utah law provides streamlined procedures in certain smaller estates so heirs can claim assets without full formal probate. If the estate qualifies for a small‑estate or summary procedure, the process is faster and cheaper; the title company or bank may release funds after the proper sworn affidavit or court approval. Check the probate code and Utah Courts’ how‑to pages for details: https://www.utcourts.gov/howto/family/intestate/ and the probate code at https://le.utah.gov/xcode/Title75/Chapter3/75-3.html
Practical steps to take right away
- Contact the title company, escrow agent, or bank holding the sale proceeds to confirm how the funds are titled and whether a beneficiary or joint owner is named.
- Search for a will or trust. A trust or a beneficiary designation may direct the distribution outside probate.
- If no nonprobate transfer applies, consider whether the estate qualifies for a small‑estate affidavit or summary administration under Utah law.
- If formal probate is necessary, a personal representative should be appointed by the probate court; the representative handles creditor notices and distribution to heirs under intestate succession.
- Keep careful records (closing statements, escrow instructions, account statements, communications). Those documents matter in probate and to the holder of the proceeds.
Timeline and common delays
Probate timelines vary. Summary procedures can resolve matters in weeks to a few months. Formal probate often takes several months to over a year depending on estate complexity and creditor claims. Nonprobate transfers are usually fastest—if documentation (POD, joint title or trust) is clear the holder can release funds promptly.
When to consult a lawyer
Talk to a probate or estate attorney if: the holder refuses to release funds, heirs dispute distribution, there are significant creditor claims, or the ownership of the proceeds is unclear. An attorney can advise whether a small‑estate affidavit will work or whether formal probate is required, and can help locate heirs and prepare the necessary court filings.
Relevant Utah resources:
- Utah Code, Title 75 (Probate): Intestate Succession (Chapter 2) and Probate Procedure (Chapter 3): https://le.utah.gov/xcode/Title75/Chapter2/75-2.html and https://le.utah.gov/xcode/Title75/Chapter3/75-3.html
- Utah Courts—How to handle estates and intestate succession (practical guides): https://www.utcourts.gov/howto/family/intestate/
Example (hypothetical): Alex sells a home; $80,000 sits in escrow. Alex dies without a will. If the escrow was payable to Alex alone and no POD or joint owner exists, the escrow agent will likely hold the funds until a personal representative is appointed or until a valid small‑estate affidavit is presented. Once the representative collects the funds as part of Alex’s probate estate, creditors are paid and the remaining funds are distributed to Alex’s heirs under Utah’s intestate succession rules.
Disclaimer
This information is educational only and not legal advice. It summarizes how Utah law commonly treats sale proceeds when someone dies intestate and points to state resources. For advice about a specific situation, contact a licensed Utah attorney.