Disclaimer: This article is for informational purposes and does not constitute legal advice. Consult a qualified attorney for guidance.
Detailed Answer
When a decedent dies without a will in South Dakota, state law governs how the estate passes to heirs. Under South Dakota’s intestacy laws (SDCL 29A-2-102), a minor child inherits in the same share they would have under a valid will. However, minors cannot directly manage inherited assets. The court must appoint a guardian of the estate to receive, manage, and eventually distribute the property on the minor’s behalf.
Appointment of a Guardian of the Estate
Under SDCL 29A-5-108, the probate court will appoint a guardian of the estate for any minor heir. The guardian must:
- File a petition with the probate court.
- Post a bond unless waived by the court.
- Inventory the minor’s inherited assets and keep accurate financial records.
- Seek court approval for significant transactions.
- File annual accountings until the minor reaches age 18.
Uniform Transfers to Minors Act (UTMA) Custodianships
South Dakota’s Uniform Transfers to Minors Act (SDCL 55-18-1 through 55-18-66) offers an alternative. A custodian can hold and manage funds or property transferred to a minor outside of formal probate. Benefits include:
- Avoiding formal guardianship appointments for the estate.
- Maintaining privacy and reducing court costs.
- Automatic distribution at a specified age, often up to age 21.
Small Estate Affidavit
If the total personal property of the decedent is valued at $15,000 or less, heirs may use a small estate affidavit under SDCL 29A-3-100. This process can speed up collections but still requires a guardian to manage a minor’s share.
Timing and Court Supervision
Regardless of procedure, the court supervises guardians or custodians to protect the minor’s interests. Guardians must provide annual accountings and may need court permission for investments or sales.
At age 18 (or at the age set in the UTMA custodianship, often 21), the court or custodian distributes remaining assets directly to the now-adult heir.
Helpful Hints
- Start probate promptly. Delays can reduce asset value.
- Consider family members as guardians to minimize fees and maintain trust.
- Review bonding requirements to protect estate assets.
- Evaluate UTMA custodianship for smaller inheritances to cut court costs.
- Keep detailed records and receipts for all estate financial activities.
- Work with an attorney to ensure compliance with South Dakota law.