When we die, all of the things that we own at the time of our death that are subject to probate administration become what is called a “probate estate.” The estate can include real property (like land, or a home), personal property (like a car or furniture), and other non-physical assets like bank account funds and securities.
The state judicial process that determines what happens to all those belongings and assets is known as “probate.” How the process goes forward is usually determined by whether the person had a valid will in place at the time that they died. If the person died “intestate,” or without a valid will in place at the time of death, then their estate will inevitably pass through probate.
Many people find the probate process unfavorable, for several reasons. It can be frustrating, and become fairly complex in a short period of time. Probate hearings can be time-consuming and confusing at times. The process may result in an unequal distribution of the property, or the property may go to a different recipient than was intended by the deceased. In some cases, a portion of the estate may “escheat,” or be claimed by the state, without any of the person’s survivors being able to claim it.
The probate process generally takes several months to complete. This is because states have certain requirements about providing notice for hearings, and allowing the estate to stay open for a period of time (usually 120 days) in order to allow creditors to file claims.
The clearest way to avoid estate probate is to have a written will in place before death. Having your last wishes detailed in writing can avoid a lot of the confusion of probate court. There are other ways to avoid probate as well, such as giving the asset away as a gift while the estate holder is still living.
There are certain exceptions to the probate estate, with particular assets that can be claimed directly by certain survivors. (The idea is that title to these assets has already been transferred during the decedent’s lifetime, or the transfer of title is controlled by a survivorship clause or mechanism.) These assets are called “non-probate assets,” and can bypass the probate court process. Each state has its own laws and rules that outline what qualifies as a non-probate asset.
Non-probate assets can include:
- Property held as tenants by the entirety or joint tenants with right of survivorship;
- Bank or brokerage accounts held in joint tenancy (with “right of survivorship”) or with payable on death (POD) or transfer on death (TOD) beneficiaries;
- Property held in a trust;
- IRA and other retirement accounts.
Generally speaking, property that is held jointly “with right of survivorship” will automatically belong to the survivor without any need for probate.
And depending on the laws of your state, some assets may be converted into non-probate status, such as:
- Bank and credit union accounts (up to a certain amount);
- Unpaid wages (up to a certain amount);
- Social security benefits (up to a certain amount);
- Some vehicles (check to see whose name is on the title);
- Some US savings bonds; and
- Certain IRS tax refunds.
Most state statutes list also employment benefit contracts and life insurance plans as non-probate assets.
The main role of the probate lawyer is to assist with the estate planning and will drafting, so that the estate can avoid the probate process after death. The estate planning process involves varied and detailed work, such as identifying and classifying a person’s different assets, assigning them to the corresponding recipients.
They may also advise on tax implications of certain aspects of the estate plan (for example, the difference between gifting an asset rather than allowing it to be distributed by the terms of a will).
However, probate lawyers do not just draft documents. They can also provide advice and help with issues that may arise in the probate process after death. A probate attorney may be involved in a case where there are contested wills or disputes over the distribution of property.
The probate process can be very demanding, especially since it involves all of a person’s belongings. Some may be overwhelmed by the whole process. It is in the best interests of everyone involved to consult a probate lawyer early on to avoid as much of the probate process as possible.
If you are dealing with the probate process, your lawyer can answer any questions you may have about the process and what to expect. If you are interested in creating a will for yourself, you will want to consult a qualified estate planning attorney. They can help you make the best decisions regarding the distribution of your belongings according to state law.