The process of proving a will to be the final testament of the person and adjudicating any claims against the will is called a probate. Probates mostly occur in the court of the state where the deceased resided permanently or at the time of their death. In case of the absence of a will, the assets in the will pass under state intestacy law to the heirs in the eyes of the law.
According to the law, a surviving spouse usually receives half of the deceased’s assets, and the remainder is distributed among the children or close kin. However, in any case, the deceased’s assets undergo probate proceedings.
Probate proceedings take money and time, and the heirs of the deceased are the ones paying for all this. These proceedings can take up to a year, and until the court gives a verdict, the assets are typically frozen. Probate usually costs 5% to 7% of the estate value.
Simplify or Avoid Probate Altogether
Regardless of being a necessary process, you can help your family avoid probate altogether when the time for distribution of your assets arrives. Here are ways to do that.
Transfer Property to a Trust
The primary reason for the existence of Inter-Vivos trusts or revocable is to help people in bypassing the probate process. The property in a trust isn’t probated like the property listed in a will; rather, it passes directly to the inheritor. All you need to do is create a trust document and transfer the estate title to a trust. To keep complete control of the property, many people usually declare themselves as the trustee. Moreover, you can also name alternate beneficiaries in a trust document, and it’s much harder to attack in court.
Set Up Payable-on-Death Registration
This registration allows you to name multiple beneficiaries of an account to avoid the process of probate. Payable-on-death registration is very simple to create and is usually free. The beneficiary in this registration can claim the money after the owner’s demise. However, these registrations require some extra time and paperwork. Getting the help of an estate law attorney can make this process easier for you.
Tax-Free Gifts
Gifting a property can help you avoid probate as you are officially not the owner of a property when you die. However, there is a yearly limit on the value of a gift that you can give your heir before you receive a gift tax penalty. You can either gift a little bit of your property each year, or you can gift it all together with a gift tax penalty. Fortunately, the gift tax penalty is lower than the probate cost.
Revisit Beneficiary Designation
Check your insurance policy and make sure the beneficiaries in the policy are updated. People often forget to update their beneficiaries after a failed marriage. This results in their ex-spouse getting custody of everything. A good family lawyer can help you with updating these details.
Joint Ownership
Joint ownerships like tenancy by the entirety, joint tenancy with survivorship rights, and community property with survivorship rights allow your listed owners to bypass the probate proceedings. However, consider that titling property jointly gives you half the ownership even while you are alive.
The Guidelines listed above can prove to be of great help in making a more effective plan. However, you will require a family lawyer or estate planning to understand these processes completely. If you live in Queens, Brooklyn, or anywhere in the New York City metro area and are seeking probate attorney Queens and probate attorney Brooklyn, we can be of great help to you. Visit our website to learn more.
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