Avoiding the Probate Process - probate attorney

By Prev Info - February 12, 2022

 The probate process is not a one day affair. It can take several months or a year at the most. Substantial monetary costs associated with attorneys and the courts are incurred during this period. Living trusts help in avoiding probate. This entails the transfer of property from an individual to a trust. In this case, the individual is referred to as a settler/creator. The trust established is controlled by the said settler. The beneficiaries obtain ownership of property after the death of the settler. A living trust has the added advantage of maintaining privacy through avoiding public scrutiny.

Using Bank Accounts and Brokerage Accounts

Another sure way of avoiding probate is through having bank accounts with paid on death designations and brokerage accounts with transfer on death provisions. This ensures automatic transfers to the chosen beneficiary or beneficiaries. If the property happens to be real estate, a life estate deed must be executed through the naming of a beneficiary to a deed by the testator.

As a matter of fact, naming beneficiaries on all assets is a sure way to avoiding probate. Life insurance is a good example of this. Declaring an estate belonging to the insured person as the contingent beneficiary will once again lead to probate. Incorporating right of survivorship to joint tenancies and savings accounts also avoids probates. Probate and the estate can be bypassed through the use of segregated funds. These have a provision within them that enables the designation of a beneficiary. This is however not a guarantee of tax elimination. The definition of a taxable estate under the modified federal estate law is any property received by a party after the death of the owner including payable on death and transfer on death finances, life insurance and property held in living trust.

Overcoming Tax Advantage Limitation

Properly structured inter vivos trusts have been known to reduce tax but not eliminate it. The complete avoidance of tax is only possible through the irrevocable give away of an entire estate or leaving it to a recognized and qualified charity. Heirs can benefit from up to twice the total estate if a married couple had credit shelter trusts that enabled them to preserve both unified credits.

This article should not be treated as a legal advice. For more information about probate process, Contact a probate lawyer.



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