If your property is passing according to your will, your will has to go through a court-supervised process called probate. However, simply because you have a will or your will is being administered by probate, this does not mean that all your property is or has to be in what is called your “probate estate.”
The idea of your “probate estate” is pretty straightforward. This is all the property that will pass to your beneficiaries through probate.
However, not all of your assets may pass through probate. There are other options (sometimes better options) that you have for passing your property to those you wish to receive it.
First, you may wish to pass some property “by operation of law.” This means that upon your death, the person who designate to receive certain property will receive the property automatically. For example, if you have a life insurance policy, you likely have listed someone on the policy who you wish to receive the proceeds of the policy at your death. These proceeds are not included in your probate estate.
Second, property titled in certain ways (such as joint tenancy with the right of survivorship, life estates, or lady bird deeds) will pass outside of probate.
Third, property that you have put in trust prior to your death will pass under your trust agreement and be administered by your trustee instead of by a personal representative appointed by the court. None of this property is included in your probate estate.
You should understand what is or is not included in your probate estate for several reasons. First, probate is a slow process, and it may take many months for your beneficiaries to receive your property. The alternative forms of property transfer will be much quicker. Second, everything in your probate estate goes into the probate file and is public record. The alternative forms of property transfers are private. Third, creditors can only make claims against property in your probate estate (unless they have a lien).
While there are many reasons to have a will, these alternate methods can be used to your advantage to make sure your property is distributed the way you want it be distributed.
For more information on Probate Vs. Non-Probate Assets, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (727) 827-7777 today.