Tools for Avoiding Probate of Estate Assets

Probate — the legal process of proving a will and administering a deceased person’s estate — can be time-consuming, costly and sometimes contentious. Fortunately, it is in many cases avoidable. Property can be left to your heirs and to other beneficiaries using private, legally effective methods that require no court involvement. These estate planning tools can be used in place of or in conjunction with a will.

Jointly owned assets generally do not need to go through probate. Each owner has a right of survivorship, which means the deceased owner’s share of the asset is automatically transferred by operation of law. Joint ownership and the right of survivorship must be reflected in title documents or other records concerning the asset.

For certain types of assets, you can designate a beneficiary to take ownership upon your death. A bank account, for example, can include a payable on death (POD) clause, which authorizes the bank to pay over the account balance to the named beneficiary. The beneficiary has no rights to the account during your lifetime.

Some states allow real estate deeds to include transfer-on-death (TOD) clauses. Florida does not, but there is an alternative, known as a Lady Bird deed. It allows you to keep property during your lifetime and have it pass automatically to a beneficiary upon your death. It creates what is called an enhanced life estate, which means you retain the right to use, finance and even sell the property, though any sale will be subject to the rights of the eventual beneficiary.

Another form of property transfer that avoids probate is a revocable living trust. This is an arrangement whereby one person manages property for the benefit of others. The trust holds title to the assets and you serve as trustee. You’ll still maintain control of the property but under a duty to protect it for the named beneficiaries. The trust also designates a successor trustee who will take over management when you pass away, making distributions to the beneficiaries as the trust directs. This form of trust can be freely changed or revoked during your lifetime.

While all of these methods can avoid probate of certain property, it is possible that some property will not fall within their coverage. It is prudent to also create a will, which should include a residuary clause directing how to dispose of any property left over in your estate. Your remaining estate may be small enough to qualify for a simplified probate process that greatly reduces time and expense.

The knowledgeable estate planning lawyers at Bankier, Arlen & Snelling Law Group, PLLC in Delray Beach can help you determine the best strategies for minimizing or avoiding probate. To arrange a consultation, please call M. Adam Bankier at 561-278-3110, Robert M. Arlen at 561-279-1880 or Linda L. Snelling at 561-501-7778 or contact us online.