No. In fact, one of the most effectives strategies for avoiding probate is to convert as many estate assets as possible into non-probate assets. As the name implies, assets that are considered “non-probate” assets bypass the probate process altogether and can be distributed immediately to the intended beneficiary.
A trust is a relationship whereby property is held by one party for the benefit of another. A trust is created by a Settlor, also called a Maker, Grantor, or Trustor who transfers property to a Trustee chosen by the Settlor. The Trustee holds that property for the trust beneficiaries. The beneficiary of a trust can be an individual, an entity (such as a charity or political organization), or even the family pet. Assets held by a trust are considered non-probate assets, meaning they bypass probate. Many people choose to use a trust to distribute their estate assets because as non-probate assets they can be transferred to the intended beneficiaries immediately after the Settlor’s death or at any time thereafter.
When you co-own an asset, titling it jointly with rights of survivorship means that your interest in the asset will transfer automatically and directly to the surviving co-owners upon your death without the need to go through probate. While joint ownership may avoid probate, it is an incomplete “shortcut” in most instances.
There are several reasons why avoiding probate is such a common estate planning goal. One reason is the amount of time it takes to get through the probate process. In the State of New York, creditors have seven months from the date of appointment of the executor or administrator to file claims against the estate. Consequently, it takes a minimum of about nine months to probate even a relative modest estate. More complex estates can easily take more than a year to probate, meaning beneficiaries often must wait that long to receive their inheritance. Another reason to avoid probate is the cost. Along with expenses, everyone involved in the probate process is entitled to a fee which can ultimately diminish the value of the estate that is passed down at the end of probate. Finally, probate is a very public process. Once the decedent’s Will is submitted for probate, it becomes public and may be viewed by anyone.
If the decedent died without leaving behind a Will, the estate is an “intestate” estate and is handled via a proceeding called intestate administration. Fundamentally, an intestate administration is the same as probate in that the basic goals of the probate process remain the same. There are, however, a few important practical and procedural differences. Chief among those differences is that the New York intestate succession laws will determine how the estate assets are distributed if there is no Will.
Most estates must go through some type of probate; however, the estate may not be required to go through formal probate. Like most states, the State of New York does have a small estate alternative to formal probate. For estates that qualify, a Small Estate Affidavit may be used in lieu of formal probate to transfer estate assets. As of 2019, the estate must have assets valued at $30,000 or less, and not include any real property, to use a Small Estate Affidavit.
Most people leave behind an estate when they die. That estate consists of all assets, both tangible and intangible, as well as both real and personal property, owned by the decedent at the time of death. Probate is the name given to the legal process that eventually transfers those assets to the new owners. Before those estate assets are transferred, however, probate also serves additional functions, such as:
- Making sure that all estate assets are identified, located, and valued
- Authenticating the decedent’s Last Will and Testament
- Litigating any challenges to the Will
- Notifying beneficiaries and/or heirs
- Notifying creditors
- Reviewing creditor claims and paying approved claims
- Calculating and paying any gift and estate taxes due
If you have additional questions about probate avoidance, or if you wish to discuss incorporating probate avoidance into your estate plan, contact the experienced estate planning attorneys at Law Office of Michael Robinson, P.C. by calling (585)-374-5210 to schedule an appointment.