Understanding the intricacies of probate and its potential impact on your estate is a crucial aspect of effective estate planning. Probate is the legal process of validating and distributing a deceased individual’s assets, and often comes with costs and delays. Let’s explore some strategies to minimize the property that passes through probate and the advantages of doing so.
Property Passing Through Probate
Property passing through probate typically includes assets devised to specific heirs in the decedent’s will and any property passing to intestate heirs. However, the advantages of avoiding probate are significant, ranging from cost savings to ensuring a smoother distribution process.
Advantages of Avoiding Probate
Transferring assets outside of probate is generally less expensive. Probate proceedings may incur fees, including court costs, state inheritance tax, and legal fees. Avoiding probate helps preserve your estate’s value for your intended beneficiaries. Assets that pass through probate are also typically not distributed until approved by a judge, which can take months. By strategically planning your estate, you can ensure asset distribution will occur in a timely manner without unnecessary delays.
Common Planning Strategies to Avoid Probate
Fortunately, there are many ways an estate planning attorney can help testators avoid probate. Some common methods used in Pennsylvania are as follows:
- Tenants by the Entirety: Spouses in Pennsylvania can own property as tenants by the entirety, shielding it from probate. The main asset that spouses normally protect with this method is the home. If the home, or any other asset, is titled as tenants by the entirety – then the spouse who survives the death of his/her spouse becomes the full owner of the home or other asset. Our skilled attorneys assist in retitling assets in the name of the surviving spouse, ensuring a seamless transfer.
- Joint Tenants with Right of Survivorship: This strategy allows multiple individuals, not limited to family relations, to hold property jointly. Upon the death of one owner, the property seamlessly passes to the surviving joint owners outside of probate.
- Payable on Death (POD) Accounts: Designating specific beneficiaries for bank accounts, including checking, savings, and certificates of deposit, ensures that the account assets are payable directly to their beneficiaries, bypassing probate and delayed distribution.
- Named Beneficiary Accounts: Similar to POD accounts, naming beneficiaries for assets such as life insurance policies and retirement accounts ensures a direct transfer to the designated beneficiaries.
- Trust Agreements: Placing assets in a trust allows for probate avoidance. Trusts are created during your lifetime, managed by a trustee, and specify boundaries – providing flexibility and control over the distribution of assets.
- Gifts: Giving away property before death can be a strategic way to reduce the size of the estate. However, consult with an estate planning attorney to navigate any possible tax implications associated with this strategy.
Navigating probate requires careful consideration and strategic planning. Our experienced attorneys at Antanavage Farbiarz are committed to helping you craft a personalized strategy that minimizes the impact of probate on your estate. Contact us today at (610) 562-2000 to schedule a consultation, and let us guide you through the process of securing your legacy.
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