While no one likes to ponder his or her own demise, there are times when careful consideration can save heartache and money for those loved ones left behind. While even the most careful plans cannot prevent all estate litigation attempts, having detailed documents in place can go a long way toward preserving one’s legacy. Like every state, New York has laws in place that can help one plan effectively to avoid the probate process.
There are steps that may avoid the probate process in certain circumstances. While each state addresses these steps differently, in general, incorporating the appropriate ones may save loved ones from having to go through this often lengthy ordeal. The first tool that one may consider implementing is titling property as a joint ownership with a survivorship clause. When property is held in with this designation, it allows the surviving owner to retain ownership of the property without having to go through probate. There are several different types of joint ownership, and there are restrictions as to which may apply in a given situation.
Three other ways that probate may be avoided are through gifts, a revocable living trust and death beneficiaries. Death beneficiaries are fairly straightforward and can apply to a Payable On Death account, retirement accounts and Transfer on Death registrations. The latter can apply to assets such as stocks, vehicles and other securities. A revocable living trust transfers an asset to a trustee, which removes it from the original owner’s possession, thereby avoiding the probate process. The trustee then turns over ownership to the designated heir, according to the trust’s instructions.
The final method to avoid probate is through the use of gifts. There are restrictions on this method, and it is suggested that only less valuable assets are distributed in this manner. While there are no foolproof ways to avoid all estate litigation, it may be beneficial to incorporate these tools when applicable. New York residents who are unsure of the most appropriate estate plans for their circumstances may wish to consult with an experienced attorney in order to draft the plans that best suit their needs and wishes.
Source: FindLaw, “Avoiding the Probate Process“, Aug. 16, 2017