What is Considered Probate Property?

For many who are deciding what they want to do with their estate upon their death, the thought of a will has probably crossed their minds. However, if you are skilled in the legalities of a will then you also know that once you die, your assets will likely have to go through a lengthy court process (probate) before they will ever be distributed to their intended parties. Of course, no one wants their loved ones to have what belongs to them tied up in court. But the good news is that everything you own doesn’t have to get caught in the system, or become what is known as probate property. Let’s take a look at some assets that do and don’t fit into this category.

Probate Property Dos

Let’s first look at some items that do fit into the category of probate property. If you own a house, car, bank account, or any other assets that are exclusively in your name at the time of your death, they will have to go through the court proceedings before being legally transferred – even if in your will you assign them to specified Beneficiaries. If you name your estate as the Beneficiary of an insurance policy, the proceeds of this policy will also need to pass through court. And if you have any salary or benefits leftover after your death, those will be included.

There are a few exceptions to the above rules; however, they are specific to each state. To determine which of these items might be able to pass on to your Beneficiary without going through the process, check your state laws or speak with an attorney.

Probate Property Don’ts

Now let’s look more closely at what assets are not likely to be deemed probate property. If you have a legal title that is to automatically pass on to someone else upon your death because that person is co-owner, then it can bypass the system. Some legal titles in this category could include land, a vehicle, or a bank account. Also, if you have a life insurance policy or retirement fund that has a named Beneficiary (other than yourself), the system won’t get involved. And if you decide to place your assets into a Trust then you can pretty much bypass any of your property falling into the court process because the Trust itself is considered a legal entity and names a person to supervise the distribution of your estate instead of the court.

It is probably in your best interest to plan how you want your assets distributed as soon as possible so that if you have an untimely death, your belongings won’t become probate property. To ensure you distribute your estate appropriately, it is recommended that you consult an estate attorney or reputable online resource for more information.

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