One of the most common ways an estate planner will try to avoid the probate process is setting up a trust. If you're worried that you're being unfairly denied access to the probate system because assets are in a trust, you may want to ask a probate lawyer to look at your situation. Here are some things you should expect to discuss when you meet with a probate lawyer.
Are the Assets Actually Part of the Trust?
Especially if someone is regularly acquiring and getting rid of assets, such as someone involved with flipping homes or buying and selling antiques, it can be difficult to move everything into the trust. Sometimes, the simplest way to address the issue is to check whether a particular property or account is named in the trust. If not, there's a pretty good chance that it may be subject to probate.
What Types of Assets Are Involved?
Even if a particular asset is named in a trust, that doesn't necessarily mean that it's legally allowed to be handled that way. For example, many types of retirement accounts can't be assigned to trusts. Similar issues occur with joint stakes in real estate because it might endanger the rights of other interests in the property.
Might the Assets be Transferred by Other Means?
While people tend to focus on estates and trusts as the primary ways to transfer assets, there are other approaches. For example, a bank account may pass to a named beneficiary if there is a payable-on-death document attached to the account. Life insurance policies are frequently handled the same way, as are some kinds of retirement plans. Real estate may also be transferred to a living spouse under some circumstances.
What Type of Trust Is Involved?
In most cases, a revocable living trust is the main vehicle for transferring assets without dealing with probate. Presuming the trust has been competently administered and regularly updated, there's a good chance a probate challenge won't get very far in such a scenario. Spill-over trusts, ones that transfer assets upon death to an existing trust, present similar challenges. Assets in testamentary trusts, ones that are only established in a will upon death, usually have to go through probate.
Note that while wills often have to be challenged within a few months, trusts may be challenged for anywhere between one and five years. These rules will vary by state, so always consult a probate lawyer from the appropriate state.
To learn more, contact a probate lawyer like those at Katzman Logan Halper & Bennett.Share