At this risk of wearing out my welcome, please allow me to present the 4th newsletter of June. I know that is way too much of me but I am handling my partner’s estate administration, so I felt compelled to discuss probate. Handling estate matters can be frustrating and time consuming. The last thing a grieving person needs to deal with is the complexities of probate and administration. Tuesday, I spent an hour and a half at DMV processing her car title. As I waited for F131 to be called, I remembered that most of this process is foreign to non-lawyers. For that matter, the probate process is foreign to most lawyers.
Here is a simple explanation of what probate is and what probate includes that might be helpful. Probate is the process of moving someone’s stuff from their personal name to the person who is entitled to receive it by law. Think about it this way: I have stuff in my name. I am no longer here. This person gets my stuff so how do I transfer my stuff to someone else after I die. You can accomplish this in three ways.
By Contract Assets that have an agreement to transfer the asset to a previously named party by agreement avoids probate. Here is a list:
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Checking accounts jointly titled or with payable on death designations
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Investment accounts with TOD or transfer on death designations
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Life Insurance to the named beneficiary
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Annuities to the named beneficiary. These designations occur outside probate process.
By Will – This is traditional probate. Someone qualifies to move your stuff to where the will states it goes. You can’t move the stuff until you are appointed by the court. IF you don’t have a will then you are qualified as an administrator to empower that person to marshal assets and authorize conveyances. Remember a Will only works when you are dead!
HOTSPOTS DMV is the usual conundrum that baffles folks. The website is helpful just remember that the DMV will require that you prove everything from identities to addresses. Consult the website for detailed instructions. Death Certificates, qualification paperwork, copies of the Will, valid ID, and car titles are the minimum pieces of paperwork you will need.
Real estate is easy. Most deeds have a surviving spouse that gets the property but if it is in one person’s name the Will or the laws of descent and distribution vest title in previously determined people. This asset can be easily dealt with by deeding the property to a trustee of a trust or if you have executed a Transfer on Death Deed. (Consult a lawyer)
By Trust – This is the ultimate probate avoidance vehicle. Think about George Carlin’s bit where he describes a house as a stuff holder. A trust is a stuff holder. Instead of waiting until you die to transfer your stuff, a trust is created while you are living to hold assets so that you can retain ownership after your death and then your previously appointed successor trustee can disburse your stuff easily without probate. The principle is simple: if probate is to help you when you are gone a trust does not expire so when you die the assets you have titled in the trust don’t have to be moved on your death. You have previously named beneficiaries of the trust so as you have instructed the trustee can disburse assets without probate. Obviously, there are exceptions, but this is why most people suggest getting a trust. Private and Probate avoiding.
Albert R. Hartley