Whenever you are working on your estate plan with your inheritance attorney, you always want to think ahead. Setting your family and loved ones up for financial success is one of the main goals of estate planning. If you aren’t familiar with estate planning, you’ll likely have a lot of new terminology and concepts to learn. Probate is certainly an important one. Probate refers to the legal process of having the court distribute your assets after you pass away. The probate process typically consists of filing a will and naming an executor of your estate. It will also include paying debts, filing taxes, distributing property, and collecting assets. There are certain assets that are considered probate assets and non-probate assets. We want to use this article as an opportunity to help you understand the difference.
Probate assets are assets that will be distributed to your heirs by the court. The will be solely owned by your decedents. These are typically assets with a lot of value. Probate assets normally refer to personal property like automobiles and jewelry, real estate that is titled in the decedent’s name, bank accounts in the decedent’s name, and life insurance policies that have the decedent listed as the beneficiary. Probate assets also can include business interests and brokerage accounts that are in the decedent’s name.
Now that we have touched on what probate assets are, let’s discuss some of the most common instances of non-probate assets. As a reminder, non-probate assets will go directly to your beneficiaries after you pass away. They typically include assets that aren’t solely in the decedent’s name. For example, if a property is held in joint tenancy or if a property is held in a trust, it’s considered non-probate. If a life insurance or brokerage account lists someone other than the decedent as a beneficiary, it’s considered a non-probate asset. Retirement accounts are also commonly considered to be non-probate assets.
We hope this article has provided you with some valuable insight into the differences between probate and non-probate assets. If you have any questions about the concepts mentioned above or would like to speak with a great estate planning lawyer, reach out to the offices of Millman Legal today. We can make estate planning an easy and straightforward process for you and help you ensure that your family and loved ones are taken care of after you are gone.