Having a comprehensive estate plan in place can help reduce probate issues upon your passing. Probate is a legal process that happens after someone dies to administer their last will and testament. While probate can be complex, lengthy, and expensive, an estate planning attorney or probate attorney can help mitigate unwanted risks. They will be able to anticipate what might happen and prevent issues before they arise.
Sound estate planning can make the probate process run efficiently and smoothly. In turn, this helps to protect your estate’s value and legacy and preserves your family’s well-being.
The probate process includes the following:
- Validating the will of the person who died
- Identifying and performing an inventory of the property of the deceased person
- Getting property appraisals
- Paying valid outstanding debts and taxes
- Distributing the decedent’s remaining assets and property according to their will
- Applying intestacy laws if the deceased person had no will
Avoiding Probate Issues
An estate planning attorney can structure your estate to minimize or avoid probate issues. Circumventing probate reduces legal fees for your surviving heirs and can make the process much quicker. It can also give your family a certain level of privacy, as probate is part of the public record.
Some Popular Alternatives to Probate
Trusts
With revocable living trust you can transfer money and property to a trust that still allows you to have access to these assets during your lifetime. This probate-avoidance technique can protect property you own, including:
- Bank accounts
- Real estate
- Jewelry
- Art collections and heirlooms
- Vehicles
This trust functions like a will by leaving your property to your loved ones. With a revocable living trust, you can change the terms of your trust and the beneficiaries or revoke it while you are still alive. After your death, the property in the trust is in the control of your named successor trustee. They will then handle the distribution of your assets to inheritors according to the trust’s instructions – without involving probate court.
An irrevocable trust can also avoid probate, as well as provide protection from the costs of long term care, but there are important differences when compared with a revocable trust such as reduced direct access and a more limited ability to make changes. But for those looking to protect assets it is essential.
Life Insurance and Annuity Policies
Death benefits are paid directly to a designated beneficiary upon the death of the insured or annuitant and pass outside probate.
Payable-on-Death (POD) or Transfer-on-Death (TOD) Accounts
Payable-on-death (POD) accounts or transfer-on-death (TOD) accounts are a simple, no-cost strategy to keep money, even large sums, out of probate.
With POD accounts, you can designate a beneficiary (or beneficiaries) for all types of bank accounts via your financial institution’s POD paperwork process. A TOD transfer applies in the same way to stocks, bonds, and brokerage accounts. These accounts will not be accessible to the beneficiary while you are alive. You can designate beneficiaries on various account types, such as:
- Checking or savings accounts
- Certificates of deposit (CDs)
- Individual Retirement Accounts (IRAs) and 401(k)s
- Inheritable pension and veteran benefits
- Investment accounts
As the account owner, you can withdraw money, close the account, or name a different beneficiary at any time. There may be a short waiting period after the designator’s death before the bank or credit union releases funds to the beneficiaries, but probate is not a requirement.
In some cases, you may not be able to name an alternate beneficiary, so staying current with the paperwork that designates your choice is important. No matter what information is in your will, it can’t override a properly established beneficiary designation.
Work With an Estate Planning Attorney to Reduce Probate Issues
The estate planning attorneys at Kurre Schneps will be able to help you identify the best path to protect your estate from the probate process and reduce probate issues. A sound estate plan can help sidestep many issues that arise from probate. Again, probate can sometimes be a lengthy process and, as a result, may reduce your estate’s value and legacy. Estate planners have the expertise to assist you and your loved ones in avoiding the additional costs of probate, both monetarily and to your family’s well-being.
