A guest post from Hildebrand Law
The probate process is very common for estates that include assets not protected by a trust. However, even in the absence of a trust, some assets may not be subject to probate. Ultimately, an estate planning attorney can help you preserve your legacy and limit the risk of your heirs having to undergo the probate process. If you are the executor of an estate, a Scottsdale AZ probate lawyer can help you settle the estate and distribute the assets while meeting legal and Internal Revenue Service requirements.
What Is Probate?
Probate is a legal process for the management of a deceased’s assets to ensure that all debtors are paid before the balance is distributed to heirs. Probate may be necessary regardless of whether or not the deceased left a will. Probate law varies from one state to another. However, many aspects are common to all jurisdictions.
If a person dies without having left a will, the entire estate automatically goes into probate, minus assets that are:
- Jointly owned with another individual. In this case, the second owner will assume full ownership of that asset.
- Assets that can be transferred to the named beneficiary, such as a retirement account.
- Assets held in a trust account with named beneficiaries of those assets.
Assets Usually Subject to Probate
Probate is necessary for assets that were:
- Property owned as “tenants in common.” For example, the percentage of ownership of the deceased person in a warehouse owned as an investment.
- Assets owned in the sole name of the deceased person. For example, a car or a real estate property owned only by the deceased.
If the will did not name an executor, the probate court will appoint someone to manage the estate. It is their responsibility to disburse the assets as well as file the necessary documents to complete the probate process. An executor has the legal right and authority to accept a percentage of the estate’s proceeds as a fee for their efforts.
Assets That Are Not Subject to Probate
Not every asset necessarily has to pass through probate. The most common example of this is if the deceased owned his property and other assets jointly with his spouse, the probate proceeding may not be necessary.
Though an attorney should review each individual case, here are some of the assets that often can avoid going through probate:
- A property that is held in a living trust.
- Life insurance proceeds. On rare occasions, this can go through probate if the estate is a beneficiary of the proceeds.
- Retirement accounts with a named beneficiary.
- Co-owned United States savings bonds.
- Property held in joint tenancy with the survivorship right.
- Salary, wages, or commissions due to the deceased.
- Household goods.
- Vehicles that are co-owned.
- Boats or cars registered in transfer-on-death forms.
- Property held in community with the survivorship right.
Moreover, simplified probate proceedings are offered for small value estates. Summary probate is the simpler process. Consult an estate planning attorney to find out more about how your estate can avoid probate after your passing.
Thanks to our friends and contributors from Hildebrand Law for their insight into probate and estate planning practice.