- Avoiding Probate by Planning
- November 9, 2016 | Author: Dustin H. Noble
- Law Firm: Hopkins Huebner P.C. - Des Moines Office
Probate is a court-administered process where the assets of a person who passed away are calculated and distributed to beneficiaries after the payment of that person’s debts and taxes. When considering estate planning, there are many situations where it makes sense to avoid the probate process after your death. Because probate is administered by the court system, the information disclosed during probate is available to the public and can be a lengthy process. By avoiding probate, overall costs can be lower, assets can be distributed to beneficiaries faster, and information can be kept private.
Probate can be avoided when the person who passed away did not own any property subject to probate at the time of his or her death. There are several ways to prevent property from being subject to probate, such as placing property in a trust prior to death or owning property jointly. If property is placed in a trust prior to a person’s death, that property is technically owned by the trust and not the person who passes away. Also, if property is owned jointly, most commonly between spouses, all interest in the property automatically passes to the surviving spouse upon the other spouse’s death. However, no matter what method or combination of methods is used to prevent property from having to go through probate, diligence is a must to ensure that an estate will not have to be probated.
Staying with the examples of using a trust and/or joint ownership to avoid probate, every single piece of property must be placed in the trust and/or jointly owned. If one piece of property is not placed in the trust or jointly owned, this one piece of property could cause the person’s estate to be probated, diminishing all of the time and effort spent to avoid probate.
If you currently have all of your assets positioned to avoid probate, or if you plan to do so in the future, it is important that you continue to make sure that all of your property, especially newly acquired property, such as bank accounts, retirement accounts, real estate, automobiles, and other valuable property, are positioned to avoid probate. By planning and remaining diligent now, you can accomplish your estate planning goals and make things easier on your beneficiaries in the future.