Probate is the process by which a court finds a will to be legally valid, directs the payment of debts, and oversees the distribution of assets following an individual’s death. However, not all property is subject to probate. By understanding the differences between probate and non-probate property, you can save your heirs time and money by avoiding probate. Consult a Pembroke Pines estate planning attorney at Kramer Green for advice about creating and maintaining the most effective estate plan for your family.
Non-Probate Assets
Generally, when individuals own assets solely in their names and pass away, their assets must go through probate. In other words, the probate court must open an estate action in probate court to distribute the assets to the deceased person’s heirs.
However, not all assets are subject to probate. Some assets pass to heirs or designated beneficiaries outside the probate process altogether. Non-probate assets can benefit the decedent’s heirs, as the probate process can be lengthy and expensive. Non-probate assets include the following:
- Real estate owned jointly with another person or persons, whether held as joint tenants with rights of survivorship or tenants by the entirety;
- Assets held by any type of trust;
- Retirement accounts;
- Life insurance or investment accounts listing a beneficiary who is someone other than the decedent;
- Bank accounts owned jointly with another person or persons; and
- Payable-on-Death (POD) and Transfer-on-Death (TOD) accounts.
In addition to joint assets and those with listed beneficiaries, Florida Statute §732.402 states that the following types of assets are exempt from probate:
- Furniture and appliances in the decedent’s home up to $20,000 in value;
- Two vehicles, each with a gross weight of less than 15,000 pounds, owned by the decedent and regularly used by the decedent or immediate family members as their personal vehicles;
- All qualified tuition programs authorized under Section 529 of the Internal Revenue Code; and
- Specified types of death benefits.
Probate Assets
Other types of assets other than those listed above are probate assets. These assets cannot pass to a decedent’s heirs until they pass through probate court proceedings. Probate assets include:
- Real property held solely in the decedent’s name;
- Real property held as tenants in common with one or more other people;
- Bank accounts owned solely by the decedent;
- Ownership of shares in a business, whether it is an LLC, partnership, or corporation;
- Life insurance policies or investment accounts with the decedent or their estate listed as beneficiaries; and
- Personal property is not exempt under Florida Statute §732.402.
The value of probate assets determines what type of probate occurs. For instance, if a decedent’s probate assets are worth less than $75,000, the estate likely qualifies for summary administration, an expedited probate process. On the other hand, if a decedent’s probate assets are more than $75,000, the estate will go through formal administration, the regular type of probate that may last six months.
Call Kramer Green for Personalized Estate Planning Advice
Getting advice about probate and non-probate property can make all the difference in your estate plan. An Aventura estate planning lawyer at Kramer, Green, Zuckerman, Greene & Buchsbaum, P.A. can assist you in drafting or updating your comprehensive estate plan. Our goal is to allow your heirs to avoid probate, create the best vehicles for preserving your assets, and ensure that your family can more easily deal with losing a loved one.
Allow us to help you navigate through the complex world of estate planning. Contact our office today at (954) 966-2112 or online to schedule a time to discuss drafting a will and related estate planning issues with our Hallandale Beach estate planning attorney.