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Do All Assets Have to Go Through Probate?

Living Trust

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When a person passes away, their assets are ordinarily distributed according to the terms of their will through probate court. With that being said, not all assets are required to go through this process. Obvious assets which need to go through probate are those that are titled in your name only, such as vehicles, property, investments, and more, as only the probate court can remove your name from an asset’s title after your death.

Assets which generally do not have to be probated include:

  • Jointly owned assets: Assets which are owned jointly, such as with a spouse, will automatically transfer to the surviving owner in the event of your death without the need for probate. If the surviving owner dies without adding another owner, or if both owners pass at the same time, it must be probated before it can be distributed to heirs.
  • Assets with a valid beneficiary designation: Certain assets such as insurance policies, IRAs, bank accounts, and retirement plans allow you to name a beneficiary to inherit the funds. If an asset has a valid beneficiary designation, it will only need to go through probate if 1) the chosen beneficiary dies before you or at the same time, 2) the beneficiary is incapacitated, or 3) if the named beneficiary is a minor.
  • Assets held in a trust: Assets which are held in a trust, such as a revocable living trust, will not be required to be distributed in probate. With that being said, testamentary trusts established in your will are not exempt from probate. Likewise, any assets left out of your living trust will likely still need to be probated.

How Can Avoiding Probate Be Beneficial?

Though necessary in many situations, probate can be a notoriously complex and costly process, oftentimes placing a heavy burden on a person’s family after they have passed. Probate court can tie up property for months or even years, along with court fees that can take up to 5% of an estate’s value. For this reason, setting up an estate plan which reduces or eliminates the need for probate can end up being a great gift to your family.

At Davidov Law Group, our Nassau County estate planning lawyers have been helping individuals avoid probate with effective and strong legal counsel for more than 25 years. To find out more about how our team of advocates can help you plan for your future, contact our office online or call us today at (516)-928-6594.

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Most people believe that naming beneficiaries in their last will and testament is their only option for leaving property and assets to surviving loved ones at the time of their death. While this is indeed an option, perhaps a better option is to use a legal tool known as a living trust. A living trust, also known as an “inter vivos” or “revocable” trust, is a written legal document through which your assets are transferred to a trust which you control during your lifetime. At the time of your death, your assets are then transferred to your designated beneficiaries by your chosen representative.

Here are the top ways in which a living trust can help you:

  • You can avoid probate: One of the greatest ways in which a living trust can benefit you and your family is that it can allow you to completely avoid the hassle and cost of probate. Even with a valid will, your estate would ordinarily have to go through probate and its associated legal proceedings before your assets would eventually be distributed, potentially taking months and costing your family thousands in legal costs. With a living trust, on the other hand, your assets are immediately transferred to your successor trustee and distributed as instructed.
  • Protection against court challenges: While court challenges against wills and living trusts are rare, living trusts are largely considered to be far more difficult to attack. Since living trusts require your continued involvement after their creation, this can often be seen as evidence that you were legally competent to manage your affairs.
  • You can avoid a conservatorship: In the event that you should become incapable of managing your living trust, such as through physical or mental illness, your successor trustee will be able to easily step in on your behalf. Without this authority, your family would instead be forced to go to court over the control of your financial matters – an oftentimes painful and highly public process. Most trust documents require the primary trustee to be certified as incapacitated by two physicians before the successor trustee may assume control.

Create a Living Trust Today – Dial (516)-928-6594

Nobody knows what the future holds. As such, it is important you take control and plan early to ensure your wishes are protected. At Davidov law Group, our Nassau County estate planning lawyers can eliminate the guesswork of creating a comprehensive estate plan and guide you towards a legal solution that is right for you. To find out more about how our team of top-rated Super Lawyers® can do for you, schedule your confidential case review today.

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A question that often comes up in estate planning is “How much money do you need to get a Trust?” The question is a fundamental misunderstanding, but a common one. Although there would not be much point in doing so, you can put as little as a single penny into a Trust.

The question is based on the premise that Trusts are designed for rich people. It’s a false premise. Trusts are designed for anyone who either wants to give something for one person to manage for the benefit of someone else or who wants to have their estate avoid Probate. Imagine that you have a minor niece that you want to leave a thousand dollars to. That’s a lot of money for most children and they can be expected to want to blow it as soon as possible. Instead of giving it to your niece directly, you can put it into a Trust. It can earn interest and be made available to your niece when she comes of age.

Trusts are also a great way for everyone to avoid having their estate pass through Probate. If you put all of your assets into the Trust, those assets will be divided according to the terms of the Trust without court intervention. It does not matter how much you have. If you have something, you can use a Trust.