Is There a Faster Way to Inherit an Estate?
One of the biggest concerns I usually hear from clients building an estate plan is, “how long will it take for my loved ones to receive my estate?” While Washington has a wonderfully constructed probate system, it can still be tedious and time consuming in its distribution of estate assets. In instances where you would want at least part of your estate to immediately be available to your beneficiaries, you will want to discuss with your attorney some “nonprobate” methods of estate conveyance.
From the sounds of it, “nonprobate” means that it does not go through probate; is that true?
Yes! Washington (and many other states) have set aside certain mechanisms which, if done correctly, will allow for your assets to transfer to your intended beneficiaries without the need to go through probate. The most common mechanism that most estate attorneys assist with for purposes of a “nonprobate” transfer is the creation of a trust; by creating a trust, and by designating beneficiaries who take after (and sometimes before) your death, those beneficiaries will immediately have access to your assets if that is what you desire.
So wait, are there other methods to create a “nonprobate” transfer? What are they?
Again, Yes! Several methods exist in which you can set up a method of “nonprobate” transfer to your designated beneficiaries. The most common methods of creating a “nonprobate” transfer are as follows:
- Create a Joint Bank Account with Right of Survivorship or Designate the Account with a Pay on Death Beneficiary;
- Create a Deed of Real Property with Joint Tenancy or Create a Transfer on Death Deed;
- Designate a Beneficiary on a Brokerage or Security Account;
- Utilize a Community Property Agreement;
- Designate a Beneficiary on an Employee Benefits Plan;
- Designate a Beneficiary on a Life Insurance Policy; or
- Creation of a Trust.
The above is not a comprehensive list, but simply lists some of the most common examples of “nonprobate” mechanisms of transfer. Again, the idea being that upon death, the designated asset will immediately transfer to the beneficiary(ies) that you specified. It is highly advised that you consult with an attorney in preparing any “nonprobate” mechanisms. After all, this is a part of estate planning and you will want to make sure that you are not inadvertently affecting other parts of your estate.
So if I can just avoid probate by creating a “nonprobate” mechanism for all of my assets, then why don’t I just do that for ALL my assets?
In a perfect world that might be a great plan. However, in the real world, people continuously acquire new and different assets, and very often they forget to place some of these assets in to some form of “nonprobate” mechanism before they pass. As such, it is very common for an estate to maintain a mixture of both probate and “nonprobate” assets. This therefore often results in the necessity of going through a probate action for purposes of handling the probate assets. However, the “nonprobate” assets are still immediately available to the intended beneficiaries, and this generally provides much relief and comfort while the rest of the assets are being transferred through the probate process.
If you have any further questions regarding “nonprobate” mechanisms or in otherwise preparing an estate plan, or if you are need to probate an estate and believe it might have some “nonprobate” assets, Nowakowski Legal PLLC would be glad to assist. Contact us for a free consultation today!