Educational guide — not legal advice. Trust and probate law varies by state and changes over time. Consult a licensed Michigan attorney about your situation.
The short answer
Michigan imposes no state death tax and sets no statutory attorney or executor fee percentage, but charges a probate inventory fee under MCL 600.871 on the date-of-death value of probate assets. What a funded trust — or a Lady Bird deed — covers against that figure is documented below.
- A trust has little to operate on where the major assets already pass by beneficiary designation or by a Lady Bird deed — those assets are outside both the probate estate (and the inventory-fee base) and the trust.
- A trust has assets to operate on where non-public administration, successor-trustee authority on incapacity, out-of-state real property, or staged distributions to beneficiaries are sought.
What makes more Michigan homeowners think about it is the state’s probate inventory fee.
The Michigan quirk: the probate inventory fee
Most reasons to avoid probate are about attorney fees. Michigan adds a specific one: a probate inventory fee under MCL 600.871(1), charged “[i]n all decedents’ estates in which proceedings are instituted for probate” on the date-of-death value of the probate assets. Under MCL 600.871(2), “if real property that is included in the estate is encumbered by or used as security for an indebtedness, the amount of the indebtedness must be deducted from the value of the real property” before the fee is calculated — so a mortgage on the home is subtracted first. It’s a sliding scale — roughly:
| Probate estate value | Approximate inventory fee |
|---|---|
| $100,000 | ~$363 |
| $250,000 | ~$550 |
| $500,000 | ~$863 |
| $1,000,000 | ~$1,175 |
| Each $100,000 over $1M | + $31.25 |
That’s on top of attorney fees (no statutory schedule — “reasonable compensation”), the probate court’s filing fee, set on that court’s published schedule, and creditor-notice publication. Keeping your home (usually your biggest asset) out of probate directly shrinks this fee. See Probate Cost in Michigan.
What passes outside the inventory fee base
The inventory fee is calculated on probate assets, so assets that pass outside probate are outside the fee base. The routes that do that:
- A Lady Bird deed (enhanced life estate deed) passes your home outside probate while you keep full control during life; we found no independent published source for what one costs. This is the big one in Michigan. See Lady Bird Deed vs. Living Trust in Michigan.
- Payable-on-death (POD) and transfer-on-death (TOD) registrations on bank and brokerage accounts.
- Beneficiary designations on retirement accounts and life insurance.
- Small-estate procedures. Michigan’s small-estate threshold has a statutory base of $50,000 (2024 PA 1) that MCL 700.1210 adjusts annually; the adjusted amount in force for the current year is not stated here, because Michigan’s statute site could not be read from this environment. A Petition and Order for Assignment (MCL 700.3982) and a Transfer by Affidavit available 28 days after death (MCL 700.3983) both use it.
Combine a Lady Bird deed with beneficiary designations, and a typical Michigan estate can pass mostly or entirely outside probate — without the cost of a trust.
What a trust covers that the free mechanisms do not
A trust operates on the assets retitled into it in these situations. What it costs to draft is quoted by the preparer, and no independent published source for that figure was found:
- You want incapacity protection. A trust lets your successor trustee manage assets if you become incapacitated, without a court conservatorship. (A durable power of attorney and a patient advocate designation for health care also help and are cheaper.)
- You own property in more than one state. A trust avoids a second “ancillary” probate; a Lady Bird deed only covers Michigan property.
- You want privacy. Probate is a public record; a trust is private.
- You need controlled distributions — holding assets for minor children, a special-needs beneficiary, or a blended family, releasing them over time. A Lady Bird deed and beneficiary forms transfer outright.
- You have multiple properties or complex assets where deed-by-deed and account-by-account beneficiary planning gets unwieldy.
When you’re fine without one
Skip the trust if:
- You rent or your home is handled by a Lady Bird deed or joint ownership.
- Your accounts already name beneficiaries.
- Your main goal is naming guardians for minor children — that’s a job for a will, not a trust.
In these cases, a will plus a Lady Bird deed and current beneficiary designations is a complete, responsible plan.
The catch with any trust: fund it
A trust only avoids probate (and the inventory fee) for assets actually retitled into it. The most common and costly mistake is paying for a trust and never deeding the home into it — which leaves the house headed for probate and the inventory fee anyway. If you set up a Michigan trust, confirm the attorney handles funding or follow a clear funding checklist.
What the record shows
Michigan imposes no state estate or inheritance tax. It charges a probate inventory fee on the date-of-death value of probate assets under MCL 600.871, and there is no statutory attorney or executor fee percentage — both are ‘reasonable compensation’. Michigan has no statutory transfer-on-death deed, but Lady Bird (enhanced life estate) deeds are recognised and pass the home outside probate; assets passing that way are not counted in the inventory fee. A funded revocable trust operates on the assets retitled into it and additionally provides non-public administration, successor-trustee authority on incapacity, and administration of out-of-state real property without an ancillary proceeding, at the setup cost cited above.
Common questions
Does Michigan have a transfer-on-death deed?
Not a statutory one — but Michigan widely recognizes Lady Bird (enhanced life estate) deeds, which serve nearly the same purpose: passing your home outside probate while you keep control during life.
What is the Michigan probate inventory fee?
A mandatory court fee on the date-of-death value of probate assets. MCL 600.871(1)(g) sets the fee at $362.50 plus 1/8 of 1% of the amount over $100,000 for an estate of $100,000 to $500,000; (h) adds $62.50 for each additional $100,000 over $500,000; and (i) $31.25 for each additional $100,000 over $1,000,000. On that schedule the fee is $362.50 at $100,000, $862.50 at $500,000 and $1,175 at $1,000,000. Assets that avoid probate are not counted, and MCL 600.871(2) deducts indebtedness secured by estate real property before the fee is computed.
Is probate expensive in Michigan?
Moderately. There’s no statutory attorney or executor fee percentage (both are “reasonable compensation”), but the inventory fee plus filing and publication costs add up — a reason homeowners often use a Lady Bird deed or trust.
Do I still need a will if I have a Michigan trust or Lady Bird deed?
Yes — a will (a pour-over will if you have a trust). It catches anything not otherwise transferred and is the only document that can name guardians for minor children.
Does a living trust protect against Medicaid estate recovery in Michigan?
A revocable living trust does not protect assets from Medicaid — you still control them, so they still count. A properly structured irrevocable trust can, at the cost of the settlor’s control, and a transfer to it is subject to the look-back in 42 U.S.C. §1396p(c)(1)(B)(i). A Michigan Lady Bird deed (enhanced life estate deed) passes the home at death outside the probate estate. What that is worth against estate recovery turns on how the state defines the recoverable estate: 42 U.S.C. §1396p(b)(4)(A) requires it to include property “included within the individual’s estate, as defined for purposes of State probate law”, while §1396p(b)(4)(B) provides that it may include, at the option of the State, “any other real and personal property and other assets in which the individual had any legal title or interest at the time of death … including such assets conveyed to a survivor, heir, or assign of the deceased individual through joint tenancy, tenancy in common, survivorship, life estate, living trust, or other arrangement.” Which option Michigan has taken was not retrieved for this page.
Does a living trust reduce the Michigan inventory fee?
Yes, for the assets it holds. The inventory fee (MCL 600.871) is charged only on assets that go through probate, so anything titled in a funded trust — or passing by Lady Bird deed or beneficiary designation — isn’t counted.
Should I use a Lady Bird deed or a trust for my home in Michigan?
A Lady Bird deed operates on one parcel of real estate; we found no independent published source for what one costs. A trust operates on every asset retitled into it, and additionally covers incapacity management, controlled distributions, and out-of-state property. See Lady Bird Deed vs. Living Trust in Michigan.
Related reading
- Lady Bird Deed vs. Living Trust in Michigan
- How Much Does an Estate Plan Cost in Michigan?
- Does a Will Have to Be Notarized in Michigan?
- Estate Planning in Michigan: The Complete Guide
- Probate Cost in Michigan
Educational information only — not legal, tax, or financial advice. Michigan trust and probate law is set by statute and changes; the small-estate threshold adjusts annually. Confirm your situation with a licensed Michigan attorney. Sources: MCL 600.871; Michigan Estates and Protected Individuals Code (EPIC), MCL 700.3719, 700.3982, 700.3983.