When you die, your assets could be tied up in probate for months instead of distributed to your heirs like your desired. You can prevent this from happening now by taking legal action. Here are some options that you and your probate attorney can exercise now to possibly avoid probate.
Why Do You Want to Avoid Probate?
A large share of the probate process is nothing more than filing documents with the court. This is especially true if there are no challenges to how your assets are distributed. While those documents are being pushed around, your estate's legal fees are growing.
Probate can rack up a number of fees including attorney, executor, and appraisal fees. All of this will be taken out of your estate's assets which impacts just how much you have left to leave to your heirs.
Probate can also hold your estate in limbo for months. Depending on the backlog in your local court system and the details of your case, it could be more than a year before your estate is legally finalized.
How Can You Avoid Probate?
There are a few methods that you can use to avoid probate. One way is simple and does not require any legal work. Start giving away your assets. If you are not the owner of the asset when you die, it does not have to be involved in the probate process.
It is important to note that depending on the amount of the asset, the recipient might be faced with paying a gift tax. Talk to your attorney before giving away something to find out if there is a gift tax on it.
Another way you can avoid probate is to set up a revocable living trust. Ownership of your assets would be transferred to the trust. When you die, the trustee would be responsible for distributing the assets. Because it is a trust, there is no need for probate and your heirs can get their inheritance quickly.
You can also convert your retirement and bank accounts to pay-on-death accounts. When you die, the money in those accounts will go directly to the person that you have listed as a beneficiary. It might also be possible for your real estate. Your attorney can inform you whether or not your state allows it.
Avoiding probate is a possibility if you do it the legal way. If you have other assets that cannot be transferred using one of these methods, talk to your attorney about how you can help your heirs and avoid probate. For more information, contact Gruber & Associates, PC or a similar firm.