By Joseph Hurwitz
In this series, Planning for the Future, I am exploring different topics and methods for Estate Planning. This article’s topic is about avoiding Probate. Probate is the legal process of dispersing a deceased person’s belongings and paying their debts. If you wish to simplify your Probate, or even avoid it, here are some ideas for you to look into.
If there is a Will, the estate will go to Probate and the Executor will be required to follow the instructions laid out in the Will. If there is no Will, North Carolina’s General Statutes dictate how to disburse the belongings and pay debts. To simplify this, if there is not a Will, the state of North Carolina will have full control of how all assets and belongings will be dispersed.
One method of keeping money out of Probate is done by designating a Beneficiary. Anyone who has a life insurance policy has hopefully made a beneficiary designation. Monetary accounts such as 401Ks, IRAs, checking and savings accounts allow you to make a Beneficiary or Payable on Death designation. This is similar to giving an inheritance in a Will but without involving Probate.
A properly prepared and maintained Trust could eliminate Probate entirely. In Part 2 of this series I talked about Trusts. Trusts accomplish any function a person can by taking ownership of property and assets. If you create a Trust, the Trust would easily take all of your property and monetary assets off of your hands while still allowing you to provide for yourself during your lifetime and your loved ones after you have passed away.
Another way to keep physical property out of Probate is accomplished by the way it is deeded or titled. Real estate can be deeded using the terms “Tenants by the Entirety” with a spouse or “Joint Tenants with Right of Survivorship” with anyone. Cars and boats can be titled using “Joint Tenants with Right of Survivorship”. This means that when one owner passes away, the surviving owner or owners automatically receive the deceased owner’s share as a matter of law and eliminates the need for the property to go through the court system.
Probate can take anywhere from a couple of months to a couple of years depending upon the quantity and nature of the belongings. Creating a Trust, assigning beneficiaries, and making sure all titled or deeded properties are properly worded can make Probate as simple as possible or even eliminate the need for Probate altogether.
This article does not create an attorney-client relationship. This article is not legal advice and if you have any legal questions or concerns you are encouraged to seek the counsel of a licensed attorney in your area.
Joseph Hurwitz, Attorney at Law – Lake Lure – 828-777-4785