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What Types of Assets Are and Aren't Subject to Probate?
Probate is the legal process by which assets and property owned by a deceased person pass to a living beneficiary. This process is for assets and property that require a court’s supervision in order to be disbursed. Not every type of asset or property is subject to probate, and an important part of estate planning involves understanding which assets are and aren’t subject to probate. You can save your beneficiaries some time and trouble by making sure that certain assets aren’t subject to probate, and you can ensure that your wishes are followed after your death by making sure that certain assets are subject to probate. Take a look at what you need to know about what types of assets are and aren’t subject to probate.

Assets In Your Name Only

For the most part, assets that you own in your own name will be subject to probate. This can include vehicles, land, houses, bank accounts, investment accounts, stocks, bonds, and business interests. If your name is the only name listed on the deed, title, or account, then the items won’t pass on to your beneficiaries without going through the probate process first.

Personal property that may not come with deeds, titles, or other paperwork, like home electronics, artwork, clothing, and memorabilia are also considered to be assets in your name only, so they will also have to go through probate.

In some cases, you can set up assets so that they have a payable on death (POD), transfer on death (TOD), or in trust for (ITF) designation. For instance, you may have a bank account that’s in your name only, which means that no one but you can access it while you’re alive. But if you add a POD designation with a named beneficiary, that beneficiary can access your bank account without waiting for your estate to go through probate. They may need to show a death certificate or other proof to gain access, but they won’t need to wait for the probate court.

Jointly Owned Assets

Anything that you own jointly with another person should avoid probate after you die. Many spouses own property this way – for example, you and your spouse may both be named on the deed to the house. If one of you dies, the other still has ownership of the property, so they don’t need to wait for probate to be considered the owner of the house. They’ll become the sole owner upon the death of the other owner.

Joint ownership can be another way to ensure that a person you want to have an asset or a piece of property doesn’t have to wait through the probate process. For example, adding your child’s name to the deed of your house can ensure that your child is able to take immediate possession of your house after you die – however, it also means that they have joint ownership while you’re still alive, which could get complicated if you decided to sell the property or take out a mortgage on the property.

Assets That Have No Living Beneficiary

In the event that one or more of your beneficiaries predecease you, assets that may not otherwise have been subject to probate become subject to probate. For example, if you own a bank account in your name with a POD designation and your spouse is named as the beneficiary, but your spouse dies before you do, then that account has no living designated beneficiary and will need to go through probate.

The same applies to jointly owned property. If the deed to your home is in your name and the name of your spouse, but your spouse dies before you do, then the house will go through probate because the other owner is no longer living.

This is one of the reasons that it’s important to update your estate plan regularly. If someone you had intended to be a beneficiary predeceases you, you can update your beneficiary designations. For instance, if your spouse dies first, you may want to update certain assets so that your child is a designated payable on death beneficiary so that they can avoid probate on those assets.

Assets in a Revocable Living Trust

A revocable living trust is a type of trust that gives you control over your own assets while you’re alive but allows you to name a successor and beneficiaries and designate what will happen to the assets placed in the trust after your death, without the need for the assets to go through probate.

Revocable living trusts remain in your control as long as you’re alive and mentally competent. You can add or remove assets, sell assets, and use the income from the assets in any way that you see fit. You can also add, change or remove beneficiaries and successor trustees. A named successor trustee is someone who will assume control over the trust in the event that you become incapacitated – they maintain control over the trust either until you are competent again or until you die.

A revocable living trust shares your Social Security number and is listed on your personal income tax forms – you’ll pay any applicable taxes on income from the trust the same way that you pay them on your personal income. When you die, the trust automatically switches from a revocable trust – one that you can reclaim assets from or make changes to at any time – to an irrevocable trust. An irrevocable trust cannot be changed and assets cannot be removed from it. Whatever designations you had for the assets at the time of your death will need to be followed by your successor trustee. That means that assets in the trust can be turned over or disbursed to your beneficiaries without the need to go through probate.

The best way to sort out all of your options for making sure that your assets pass to the proper beneficiaries after your death, with or without going through probate, is to talk to an estate planning attorney. David Folkenflik is an attorney in St. Petersburg who handles estate planning and can help you make sure that your assets and property will go where you want them to go after your death.

"The information provided herein is simply a brief overview of the Florida law on this particular matter. It should not be relied upon for legal purposes, as the facts and circumstances to any specific legal matter may vary substantially from the limited explanation and application of often complicated legal rules and principles that may be addressed herein, or applicable in your particular legal matter. You should only rely upon legal advice provided to you by a licensed attorney who has had an opportunity to fully evaluate your particular legal matter".

David Folkenflik
Attorney

Mr. Folkenflik is a graduate of Countryside High School, in Clearwater; St. Petersburg Junior College; and the University of South Florida in Tampa. He received his law degree, with Honors, from the University Of Florida College Of Law at Gainesville.

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