When planning for your family’s future, you can’t assume that your assets will go where you want them to go upon your death. Sentiments like, “Everyone knows who is supposed to get my Cadillac,” or “My children will not fight over my family property,” can lead to messy court battles and dollars thrown down the drain unnecessarily. Unfortunately, many people believe that a will is enough and take no further action. However, a will is not enough. You must know about the probate laws of your state.
Probate laws are complicated. In many instances, you will need professional assistance. However, there are steps that you can take to ensure your assets are divided as you want them to be. Furthermore, these steps will help prevent family squabbles when everyone’s emotions are already raw. By abiding by these quick fixes, your family should be able to stay out of probate.
Gifting property before you die is one way to help avoid probate issues. If you have property items that you would like for a specific family member to have, you can gift the item before you die. There are some drawbacks to this process. You can’t give everything away and still have a comfortable living, so there will still be items that must be accounted for after your death. Moreover, when items are of a certain value, a federal gift tax may be invoked. Additionally, if you don’t explain in writing that a particular item goes to a particular person, that person can still claim his or her portion of your property during probate.
Joint Ownership of Real Estate
When you own property that you want to pass on to another person, another way to avoid dealing with probate laws is through joint ownership. The benefit of joint ownership, if you have survivorship rights, will result in your property transferring to the other person upon your death. There are a few issues with joint ownership. One such problem is that the joint owner has rights for current transactions as well. For example, if you choose to sell the property, your joint owner will have to agree.
Joint Ownership of Non-Real Estate Property
As with real estate, non-real estate property can be owned jointly. To ensure that this property avoids probate, you need to spell out the property expectations. In essence, the title should include which survivorship rights are intended. Financial property can become trickier. If you add another person to a checking or savings account, that person can legally make withdrawals without your permission.
In dealing with life insurance policies, you must keep your beneficiaries current. When a change needs to be made, don’t wait until it is too late. With these types of policies, they will be paid to the designated beneficiaries upon your death and subsequently closed out.
Lastly, another step to avoid probate is to establish beneficiary designation for different types of property upon your death. Types of items that can be established as Transfer-on-Death (TOD) include vehicles, securities, and real estate. To set these up, you can contact the different entities that govern the property in question and fill out the appropriate documentation.
If you want to avoid your family having to deal with probate laws, you must be aware of the probate laws of your state. There are steps you can take to keep most of your property out of probate. If you need expert advice to guide you through the process of navigating probate laws, contact us at the Law Offices of John L. Schettino. We are an experienced law firm. Contact us today.