Unless you've created a proper estate plan, when you die many of your assets must first pass through the court process known as probate before those assets can be distributed to your heirs. Like most court proceedings, probate can be time-consuming, costly, and open to the public, and because of this, avoiding probate—and keeping your family out of court—is a central goal of most estate plans.
During probate, the court supervises a number of different legal actions, all of which are aimed at finalizing your affairs and settling your estate.
What are Probate Assets?
What assets require probate?
- Accounts and real estate titled in your sole, individual name [without a payable on death (POD) or transfer on death (TOD) designation]
- Accounts and real estate you own as a tenant in common
- Contract assets naming your estate as beneficiary
What Assets Avoid Probate?
What assets automatically avoid probate after you die and, therefore, do not need to be funded (or cannot be funded) into your trust?
- Accounts and real estate owned as joint tenants with rights of survivorship
- Accounts and real estate owned as tenants by the entirety
- Life insurance
- Retirement accounts, including IRAs, 401(k)s, and annuities
- Life estate property
- Payable on death (POD) and transfer on death (TOD) accounts and, in some states, transfer on death or beneficiary deeds