Probate is the legal process of administering an estate after someone dies. The process includes verifying the validity of the deceased person’s will (if there is one), paying off debts and taxes, and distributing the remaining assets to the rightful heirs or beneficiaries.
Probate is necessary to ensure that the deceased person’s assets are distributed according to their wishes and to prevent disputes between heirs. However, not every estate needs to go through probate. In some cases, assets can be transferred outside of probate, saving time and money.
In this blog, we’ll explore when probate is needed and when it can be avoided.
When Is Probate Needed?
Probate is usually required when a person dies with assets solely in their name, without any designated beneficiaries or joint owners. These assets are known as “probate assets.”
Probate assets may include:
- Real Estate: Any real property owned by the deceased person is considered a probate asset. This includes a home, vacation, rental, or other real estate.
- Bank Accounts: If the deceased person had a bank account in their name only, it is considered a probate asset. Joint accounts with rights of survivorship (JTWROS) and accounts with designated beneficiaries can avoid probate.
- Investment Accounts: Investment accounts in the deceased person’s name only are probate assets. Retirement accounts with designated beneficiaries, such as 401(k)s and IRAs, can avoid probate.
- Personal Property: Personal property, such as jewelry, artwork, furniture, and vehicles, is typically considered a probate asset.
- Business Interests: If the deceased person owned a business, their interest in the company is considered a probate asset.
When Is Probate Not Needed?
Probate is not always necessary. Assets that are owned jointly or have designated beneficiaries can avoid probate. Examples include:
- Jointly Owned Property: Property owned jointly with rights of survivorship (JTWROS) automatically passes to the surviving owner when one owner dies. This means that the property does not need to go through probate.
- Accounts with Designated Beneficiaries: Accounts with designated beneficiaries, such as life insurance policies, retirement accounts, and payable-on-death (POD) accounts, can avoid probate.
- Trusts: Assets placed in a living trust during the deceased person’s lifetime do not have to go through probate. Instead, the assets are distributed according to the terms of the trust.
- Small Estates: In some states, if the deceased person’s estate is valued below a certain threshold, probate may not be necessary.
The probate process can be complicated and overwhelming for those who are unfamiliar with it. However, with the help of a knowledgeable and experienced probate attorney, the process can be made much smoother and more manageable. At KousLaw PLLC, our team of probate attorneys understands the intricacies of the probate process and can guide clients through every step of the way. We strive to provide compassionate and supportive legal services that make the process as stress-free as possible. Contact us if you have any questions about probate. Our team of experienced attorneys is ready to assist you and provide the guidance you need to protect your assets for future generations.