One of the most common myths surrounding estate planning is the belief that by executing a Last Will and Testament you ensure that your estate won’t have to go through probate. This is simply not the case. In fact, it is rarely the case. There are a number of estate planning tools and strategies that can help minimize your estate’s exposure to probate, or even avoid probate altogether; however, simply executing a Will does not accomplish probate avoidance.
To understand why this myth is so common you must first understand what probate is and why it is typically required when someone dies. Probate is the legal process that is used to ensure that all of the property owned by a decedent, both real and personal as well as tangible and intangible, is identified, accounted for, and valued as of the date of death of the decedent. Probate also allows creditors of the decedent to file claims against the estate prior to the distribution of estate assets to the intended beneficiaries or heirs of the estate. Both federal and state taxes owed by the decedent or the decedent’s estate must also be paid out of the estate assets before the remaining assets are finally transferred to beneficiaries or heirs of the estate.
Your Last Will and Testament provides a “blueprint” for the distribution of those assets after your death. By executing a Will you are able to decide yourself who will receive which assets owned by you when you die. If you die without leaving behind a valid Will the New York intestate succession laws will determine who receives your estate assets. The existence of a Will does not, however, mean your estate avoids probate. As long as you own probate assets at the time of your death they will likely have to go through probate. The key to avoiding probate, or at least minimizing your estate’s exposure to probate, therefore, is to own “non-probate assets” at the time of death. Some of the more common ways to avoid probate are to include the following in your estate assets:
- Assets owned by a trust
- Property titled as “joint owners with rights of survivorship”
- Proceeds of an insurance policy
- Accounts designated as “Payable on death” or “Transfer on Death” (POD or TOD)
- Certain retirement accounts
If probate avoidance is important to you, as it is to many people, consult with your New York State estate planning attorney about ways you can limit your estate’s exposure to the probate process after your death. Doing so will save your loved ones both time and money as well as frustration.
If you have additional questions or concerns about probate avoidance or estate planning in general, contact the experienced New York estate planning attorneys at The Law Offices of Saul Kobrick, P.C. by calling 800-295-1917 to schedule your appointment.