The probate process can often be burdensome for surviving family members. Not only are you having to cope with the loss of a beloved family member, but you must also deal with the details of paying their last expenses and handling their assets. Often times, probate can be avoided with relatively minimal planning on the front end.
Probate is only necessary when the decedent, at their death, has ownership interest of an asset or assets in their individual name with no beneficiary designation. The only way to get the title to that asset transferred out of the decedent’s name is to go through the probate process.
Kentucky residents can avoid probate in the following ways:
• Joint Ownership
• Payable on Death Designations
• Transfer on Death Designations
• Revocable Living Trusts
The most common example I see with my clients is a married couple who come in to do estate planning. I explain to them that ideally, if nothing less, we want to make sure to avoid probate when the first spouse passes away. This often is not too difficult a task, unless they are a blended family (children from separate, previous relationships). In the more common example of a couple with only joint children, the majority of the time their accounts are either joint or have the other spouse named as beneficiary. The home is almost always jointly owned with rights of survivorship. However, there have been dozens of time where probate has been required only because of the vehicle used primarily by the decedent was in their name only. The absolute only way to get clean title for that vehicle is to go to court. My advice is often to make sure all vehicles are jointly owned by both spouses – this would avoid this pitfall.
Continuing with the married couple example, the best way to avoid probate for both spouses’ deaths is to create a Revocable Living Trust. The Trust would hold the home, any other real property, and any non-retirement financial assets. The Trust would name the spouses as joint trustees, and it would also nominate the successor trustee(s). If properly funded, the assets in the trust would be transferred outside of probate to the beneficiaries named in the Trust.
If you would like to discuss probate avoidance, please give me a call today or email me at firstname.lastname@example.org to schedule a complimentary initial consultation.