Where Does My Property Go After I Die?
Estate administration is a court-supervised process designed to sort out the transfer of a person's property after death. Your personal representative will handle this process from beginning to end as a part of their overall estate administration duties. Tasks can include collecting, managing, and distributing the decedent's estate.
Some property passes automatically to another party upon death, such as family members in a joint bank account. The court will examine other property subject to the estate and grant it to the appropriate party.
Some assets in a decedent's property may need special considerations before passing to a loved one or being used to pay off debts or estate taxes. The deceased person is legally referred to as “the decedent."
Probate: The Process When You Have a Will
You may have heard of "probating a will." This refers to a will presented to the court that fulfills the legal requirements to be upheld as valid.
The court then considers the directions written in the will. If nothing is illegal or overridden by other laws, the court divides the property according to the deceased's wishes.
Probate Process When The Will Is Contested
Probate may be contested or uncontested. There may be a disgruntled person seeking a larger share in contested probate.
In these situations, legal and factual arguments are introduced to support or undermine the claims of various parties.
Probate Process When The Will Is Not Contested
The probate of most estates is uncontested, however. In these cases the property is collected, debts and taxes are paid, disputes are settled, and the remainder of the estate is transferred to the heirs.
Estate Administration Process When You Don't Have a Will
Passing away without a will is called being “intestate." The process and estate assets may be more complex without a valid will following the decedent's death.
Avoiding Probate Court: Common Methods
Probate court proceedings are often criticized as being costly and time-consuming. Avoiding probate court can ensure that beneficiaries receive their benefits more quickly and less is lost to administrative and other expenses.
As a result, many methods have been developed to try to avoid probate court, such as:
Certain trusts, life insurance policies, and "Totten Trusts" (also called "payable-on-death" accounts) are also capable of avoiding probate. This is done by transferring ownership to the beneficiary before death or automatically upon the creator's death.
Each of these processes has benefits and drawbacks. After learning the basics, it is advisable to research more closely. This helps avoid creating new problems while trying to avoid probate court problems.
Avoiding Probate Court: Joint Property Ownership and Death Beneficiaries
Jointly owned property that includes a "right of survivorship" can avoid probate court proceedings. This works because the deceased joint owner no longer owns the property after death, leaving only the surviving owner. This can also be called “joint tenancy."
Assets that permit you to designate a beneficiary upon death are called “death benefits." They may also avoid estate administration.
Avoiding Probate Court: Revocable Living Trust
Revocable living trusts function similarly to joint property ownership. Upon death, the property automatically transfers to the beneficiary. This means that it isn't the deceased's property when estate administration occurs.
Avoiding Probate Court: Gifts
Making a gift of something before death will also allow the gifted property to avoid estate administration. The deceased person no longer owns the property they gave away.
Avoiding Probate Court: Small Estate Affidavit
Some small estates can use a signed legal statement called an “affidavit." This document swears a person can inherit a property item or asset. It does depend on your specific state laws, but a sworn affidavit can help a small estate avoid going to probate court.
Avoiding Probate Court: Probate Exemptions
Probate Court may be avoided through the use of a probate exemption. Exemptions allow for probate avoidance or a simplified estate administration process for smaller estates. In some states, probate court proceedings are eliminated or simplified for property left to the surviving spouse.
When To Call a Probate Attorney
Probate can feel confusing and larger or more complex estates can be overwhelming. You can always seek legal advice or ask in-depth questions about probate code in your state and overall probate laws. Finding a local attorney that focuses on probate is a good first step, and they may offer your first phone call for free.