A common misconception is that a Last Will and Testament (a “will”) avoids probate administration.
A will is a legal document that expresses someone’s intention for what is to happen after they
die. A will can be basic or complex. Wills generally set forth where you want your assets to go
upon your death, after payment of debts, and disclose who you appoint to ensure that your will is
administered (i.e. personal representative). Wills may also include trusts for minors or adults,
nominate trustees for such trusts, and guardians for minor children. However, wills, in and of
themselves, do not avoid the need for a probate administration.
Probate is the process of establishing the validity of a will, gathering assets and debts of the
decedent, paying debts of the decedent, and distributing any net estate assets to the beneficiaries
named in the will (or if no will, then to the heirs determined by state statute). Probate usually
takes months, if not years in complicated matters, to complete. It requires filing fees to be paid
to the Register in Probate in the amount of .2% (two-tenths of one percent) of the total probated
assets. Probate is a public proceeding, and it creates a process in which creditors can make
claims against the estate assets for payment. Often clients desire to avoid probate because of
these requirements, and to avoid the public disclosure of a decedent’s assets and liabilities.
Probate may be avoided by ensuring financial accounts are either jointly titled or have
beneficiaries designated, contain a payable on death or transfer on death designation, or are
funded into a revocable trust. These techniques avoid the need to go into a public probate
process to transfer such assets and instead each individual account or financial institution
transfers the assets pursuant to such specific designation. While there tends to be more work
and/or cost upfront, upon death these non-probate transfer options tend to be more efficient and
cost-effective, as well as more private.
Even if probate is planned to be avoided, it is recommended to always have a will executed. As
stated above the will sets forth the decedent’s intent and wishes. A will provides guidance as to
how to transfer various untitled property that does not need probate to transfer including, but not
limited to, furnishings, clothing, keepsakes, cash on hand, and firearms. Also, at times,
beneficiary designations may be forgotten or certain designations may fail – if this happens, a
will ensures those assets get to the persons named by the decedent.
It is important to discuss with a trusted attorney about your specific estate planning needs and
goals. There is not a “one size fits all” estate plan.
–Alison C. Petri © 2018
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This blog post is provided for informational purposes only and by its very nature is
general. This information is not intended as legal advice.