Different Types of Non-Probate Assets

If you’re considering creating a will and believe that it would be wise to start planning your estate, you should know more about the probate process and the types of assets that are considered non-probate. The probate process is a lengthy one that can sometimes cause issues with your assets and who they are given to. By avoiding the probate process, you’ll be able to have a direct say in what happens to some of your property and assets.

What Is the Probate Process?

Probate is a type of legal process wherein your final debts are settled within a probate court. The legal titles of your property are also handed over to the people who you’ve marked as your beneficiaries and heirs when drafting your will. Although this is a court-supervised process, there’s hardly any supervision by members of the court. The actual process typically involves filling out a substantial amount of paperwork in order to pay off any taxes and debts with the deceased individual’s assets.

What Assets Are Classified as Non-Probate?

There are some assets and types of property that may classify as non-probate, which means that these assets can go directly to your beneficiaries without being taken through the time-consuming probate process. For instance, assets that are jointly owned with your spouse or another individual through the standard rights of survivorship will be able to avoid the probate process. The same is true for life estates and living trusts. Any assets like IRA’s, life insurance policies, and annuities can be given directly to beneficiaries.

What to Consider When Planning Your Estate

While avoiding probate can be beneficial, there are times when your assets could go to people you don’t want them to. For instance, if you have a joint account at your bank with your spouse but want the assets to be given to your children, the account will go directly to your spouse. An estate planning lawyer in Las Vegas may help craft an estate plan to ensure your wishes are carried out.

Different Types of Trusts Available to You

While you’re conducting estate planning for the future, you may want to focus on creating a trust, which is a type of legal entity that allows a second party to hold assets that will eventually be provided to a third party or beneficiary. Given that there are numerous types of trusts that you can choose from, you’ll want to understand the differences between these options before selecting one. You can also obtain the services of a trust administration lawyer Las Vegas if you want to be provided with advice while creating a trust.

What Is a Trust?

A trust is a type of financial agreement that’s made between you and two other parties. The second party will hold your assets for the third party who will eventually receive the assets. These assets can include your estate or any kind of property. The trustee who is supposed to manage the trust will be titled within the agreement that’s made. The third party can be one or more beneficiaries of the trust.

Main Types of Trust

There are five primary types of trust that include living, revocable, testamentary, irrevocable, and funded/unfunded trusts. While these are the main types for you to select from, there are a variety of others that may apply to you. A living trust is one that’s made during the grantor’s lifetime wherein the property or assets contained within are meant to be used during their lifetime before being provided to the beneficiary upon the grantor’s death. A testamentary trust details who should receive assets upon the grantor’s death, while a revocable trust is one that can be changed or closed at any time. On the other hand, an irrevocable trust cannot be changed, and the assets are unable to be moved back to the grantor. Funded and unfunded trusts are trusts that can have assets placed into them during or after the death of the grantor.

Benefits of a Trust

The main benefit of creating a trust is that it can help you reduce the estate taxes that your beneficiaries will need to pay upon your death. Other benefits include the ability to avoid probate and the requisite court fees, to protect your assets from creditors, and to allocate your assets into the right hands.

How Your Estate Plan Changes When Your Marriage Ends

The end of a marriage can be a difficult time for you. In addition to processing your emotions, it may be necessary to accept the financial realities of a divorce. Furthermore, it will generally be necessary to change your estate plan to reflect your new relationship status.

Review Your Beneficiary Selections

Your former spouse is likely a beneficiary to some or all of your assets. If assets were to be transferred by a will, change its terms to include a new beneficiary or to put them in a trust. If they were to be transferred by a beneficiary designation, change or revoke the designation. It is important to note that beneficiary or other transfer on death (TOD) declarations will trump whatever is in a will.

Revoke Powers of Attorney

It is not uncommon for a person to name their spouse as their financial or health care agent. However, if these powers are not revoked or amended after a divorce, that person could still make decisions for you in the event that you can’t make them on your own.

This could result in a former spouse having access to medical records or other information that could be used to harm you or otherwise cause problems in your life. In the event that you don’t have an adult child or friend to act as an alternate power of attorney, financial or legal professionals may act in that capacity.

You Choose How to Structure an Estate Plan

It is possible to create or amend estate plan documents on your own. However, if you need assistance, an estate planning attorney in Las Vegas may also offer assistance. Having a professional look over your plan may minimize the chances that a document is written or altered improperly. That may minimize legal challenges or other delays in implementing the plan after you pass.

Why Attorneys Make Good Executors

If you are looking for someone to act as executor of your estate, it may make sense to turn to an attorney. One good reason to do so is that an attorney is more likely to act as an objective steward of your possessions. He or she is also more likely to understand the law and make fewer mistakes as a result. Finally, there is generally no need for an attorney to hire an attorney, so that saves the estate money.

Keep Family Strife to a Minimum

By hiring an attorney to be your executor, there is less of a chance that your family members will get upset. In some cases, siblings or cousins of the person chosen to fill this role get suspicious of his or her motives. While this may happen with a professional representing the estate, it is unlikely that there will be a challenge to a will or other estate plan document.

Close the Case in a Timely Manner

By avoiding mistakes, it can make it easier to close a probate case in a timely manner. Furthermore, an attorney may not need to ask questions or ask for more time to get documents together. This is because an attorney is less likely to have personal or professional obligations while serving in this role. If you select a brother or parent to be your representative, this person might have to settle an estate around a major project at work or caring for another family member.

You Won’t Pay Two Different Fees

You won’t need to pay both an executor’s fee and an attorney fee when one person can do both jobs. Typically, a probate attorney in Las Vegas will only charge his or her attorney fee to act as an executor for your estate.

Choosing Between Amending Estate Documents and Creating New Ones

At some point in the future, you may need to add a beneficiary to a will or change the terms of a trust. This can be done through a simple amendment or by creating a whole new document. Here is how you can tell which option will make it easier to have your wishes respected in the future.

When Should You Amend a Document?

It may be best to amend a document when the change is a simple one. For instance, you decide that you want a beneficiary to receive $1,000 annually as opposed to $500 annually from a trust. Amending a will, trust or other estate plan component may also be easier if there only a few amendments already made to it. Your estate planning lawyer in Las Vegas may offer additional insight into when this is the right choice.

When Should You Create a New Document Entirely?

It may be in your best interest to create a whole new document if an amendment could be perceived as fraudulent in nature. For example, a bank may not work with an agent if a power of attorney declaration has been amended as opposed to rewritten entirely. Furthermore, creating a brand-new will or trust could be a good idea if it has been amended multiple times. At some point, it may be difficult for an executor to follow. Therefore, a clean will or trust may increase the chances that your wishes are followed as written.

Consistently Review Your Estate Plan

Over time, your estate plan needs may change as you start a family, or the tax code is overhauled. Therefore, it is a good idea to make sure that you review it annually to make sure that it still does what you want it to do.