The process of probate can be a factor when an estate is being administered. It serves a purpose, but it is time consuming, and the beneficiaries do not receive inheritances while the estate is being probated by the court.
This is one of the drawbacks, and the cost factor is another one. Probate expenses include the executor’s payment, possible accounting and legal fees, court costs, litigation and appraisal charges, and incidentals that drive down the value of the estate.
Since probate is a public proceeding, anyone that takes the necessary steps can access the records. A loss of privacy is never a good thing, and the information can cause acrimony among interested parties.
Will Administration and Intestacy
If you use a simple will to state your final wishes, the executor that you name in the document would be required to admit the will to probate. However, in Connecticut, there is a simplified probate process that can be available for estates that do not exceed $40,000 in value.
When someone dies without any estate planning documents at all, the estate is an intestate estate. Under these circumstances, the probate court would supervise during the administration process, and they would appoint a personal representative to act as the administrator.
Some types of transfers are not subject to probate even if you were not intentionally trying to avoid it. Life insurance proceeds are distributed to the beneficiaries outside of probate, and the court is not involved when an individual retirement account is inherited by a beneficiary.
A payable on death account is a bank or a brokerage account that has a beneficiary. If you open up one of these accounts, the beneficiary will have no access to the resources while you are alive, and they would inherit the account after your passing. Probate would not be necessary.
You can add a co-owner to your property ownership documents. This is called joint tenancy with right of survivorship. The surviving joint tenant will inherit the deceased joint tenant’s interest in the property, and this would be a probate-free transfer.
Proactive Probate Avoidance
If you want to avoid probate and the drawbacks that go along with it, you can use a revocable living trust as the centerpiece of your estate plan. While you are living, you would be the trustee, so you would retain complete control of the resources in the trust.
You would be able to add or remove property from the trust at any time, and you would have the power to change the terms. In fact, you can dissolve the trust entirely for any reason or no reason at all, and it would no longer exist.
From an estate planning perspective, you name a successor trustee to act as the administrator after your passing. This can be a person that you know, and you can alternately use a professional fiduciary such as a trust company or the trust department of a bank.
After your death, the trustee would distribute assets to the beneficiaries, and the probate court would not be involved. With regard to the distributions, you can allow for limited distributions over time to prevent reckless spending and/or poor money management decisions.
When you are drawing up the trust agreement, you can empower the successor trustee to act as a disability trustee in the event of your incapacity. A pour over will can be included as well to trigger the transfer of personally held assets into the trust after your passing.
Schedule a Consultation!
The living trust is one of the tools in the estate planning toolkit, and there are other approaches that can be taken to address targeted objectives. There is no one-size-fits-all estate plan that is right for everyone, and this is why you should work with an attorney to develop a custom crafted plan.
We know that it can be disconcerting to talk about personal matters with someone you have just met. You can rest assured that everyone on our team will make you feel perfectly comfortable from the start, and we go the extra mile to exceed the expectations of our clients.
If you are ready to get started, you can schedule a consultation at our estate planning offices in Westport or Glastonbury, CT if you call us at 860-548-1000. There is also a contact form on this site you can use if you would prefer to send us a message.