Probate courts help protect those who lose loved ones. The probate courts oversee estate administration to ensure that personal representatives follow the instructions of deceased individuals. They also help ensure the proper application of intestate succession rules in scenarios where people die without a will or other estate planning documents.
While the probate courts do serve an important purpose, they can also be a source of frustration. Probate proceedings require months to complete and can sometimes last for more than a year. Those hoping to inherit from an estate have to wait for creditors to make claims and the personal representative to determine that they can distribute assets without financial risk. Probate court can be both expensive and frustratingly slow for those hoping to inherit from an estate.
Can those planning estates create arrangements that allow their resources to bypass probate court?
There are many ways to keep assets out of probate court
Testators thinking about their future legacy or the protection of their loved ones may soon come to realize that there are numerous ways to bypass probate court. One of the simplest is to change ownership of certain assets.
By making gifts while they are still alive or taking on co-owners, people can keep assets from becoming part of their estates and can therefore keep them out of probate court. Adding transfer-on-death designations to financial accounts can also be a means of keeping resources out of probate court after the current owner dies.
People can even create trusts and use assets to fund the trust as a means of diminishing how much property must pass through probate court. These prior arrangements may allow people to assume ownership shortly after the passing of the testator without the involvement of the probate courts.
Such tactics can be particularly beneficial when testators worry about estate taxes or creditor claims against their estates. Assets that are not part of the estate are not vulnerable to recovery efforts and do not contribute to the taxable amount of the estate.
Those who create thorough, customized estate plans can often reduce the frustration and expenses of probate proceedings. Discussing the property included in an estate with a skilled legal team can help people determine the best way to keep specific assets out of probate court.
