Benjamin Franklin once said, “Nothing is certain except death and taxes.” If you don’t have a trust and your estate is larger than $150,000, then your heirs can count on the certainty of Probate too.
Probate is a court supervised process necessary to transfer assets to the decedent’s beneficiaries when a person dies without a trust. Because probate can be a lengthy and laborious process that can take anywhere from nine months to over a year to complete, it should be avoided. The only way to avoid probate, without giving away rights to your property while you are still living, is by creating a trust. Even the existence of a will cannot circumvent Probate.
During the Probate administration, beneficiaries have limited access to the assets, which poses problems when beneficiaries cannot afford to pay the decedent’s mortgage or other expenses, but have no authority to sell the assets either. A probate court must review all assets and cannot distribute them until the conclusion of the matter. Trusts offer an easy solution since a decedent’s assets held in a trust can be immediately sold or conveyed upon the testator’s death without court approval.
Sparing the expense of preparing a trust will only result in a higher cost to the estate in the future. Generally, the cost of a probate will exceed the cost of managing and distributing comparable assets held in a trust. Additionally, attorney’s fees in probate are fixed by statute, unlike the cost of an attorney to prepare a trust, which can be negotiated.
More importantly, the only way to direct who will receive assets is through a trust. When an estate is probated, the court will have full discretion to distribute the assets to heirs according to a statutory scheme which may result in distribution contrary to the decedent’s preference. If it is important to you to direct where your assets will go at your death, then a trust would be ideal.
The loss of a loved one is a sad time for family, relatives, and friends. Don’t make them navigate the Probate process as well. Take action to avoid probate today!
Dana Heyde is a Partner at Cottle Keen Lopiccolo & Heyde in Orange, where the firm has had a continuing presence in the community for over twenty-five years. CKLH focuses on Family Law matters and Estate Planning. CKLH works closely with each client to understand their objectives and guide them through the legal process. CKLH would be honored to help you with your legal needs.