When someone dies with a will, their will is admitted to what is called "probate." Probate is the court-supervised legal procedure where a will is proven to be valid, the decedent's debts and claims against the estate are paid off, and lastly, the remaining assets are distributed to the beneficiaries named in the will.
Probate is known for being a somewhat long and drawn-out legal proceeding in which the estate assets can be tied up for a year or sometimes longer if real estate needs to be sold or if there is a will contest. Aside from monitoring the executor's actions and behavior, probate serves an important purpose: it is designed to transfer the title of assets that are held solely in the decedent's name.
Probate assets include things such as the decedent's bank accounts, investments, personal belongings, jewelry, collectibles, and real property etc. that do not have designated beneficiaries. However, there are ways to circumvent the probate process with intelligent planning in advance.
There are actions that someone can take to reduce or eliminate their "probate assets," so that certain property is not subject to probate. For example, one of the best ways to avoid probate is through the living trust. With a revocable living trust, all of the assets that are moved into the trust are not subject to probate. However, if you fail to move assets into a trust before your death, those assets will most likely have to go through probate in order to transfer ownership. Other tools for avoiding probate include:
- Naming death beneficiaries for IRAs, annuities and other retirement accounts;
- Naming death beneficiaries on life insurance policies;
- Payable-on-death bank accounts;
- Joint property ownership such as joint tenancy with right of survivorship; and
- Gifts – By giving away property while you're still alive, you don't own it when you die and it's not subject to probate.
What is the purpose of avoiding probate? Probate is a court-supervised legal proceeding that can tie up property for many months, and even a year or longer, and this can be hard on all parties involved. One of the main reasons why people try and avoid probate is so they can avoid the fees associated with probate. In addition to the fees paid to an executor, the court, and an attorney, there are other fees involved and these can include appraisers' fees, accountant fees and other costs.
If you want to maximize the value of your estate and if you want to minimize any potential court costs and legal fees, we urge you to contact an Elizabethtown probate attorney from Cooper & Cooper Law Offices today at (270) 767-6098. As a father and son legal team with over 40 years of combined experience, we're prepared to help you reach all of your
estate planning goals, and protect the integrity of your estate.