1. Which Assets Are Non-Probate Assets?
Non-Probate assets are those owned in one of the following manners:
- Joint tenant with right of survivorship (some joint bank accounts or brokerage accounts),
- Tenancy by the entireties (marital ownership of a home),
- Transfer-on-Death designations (IRA, 401k, 403b, some bank accounts),
- Pay-on-Death designations (life insurance, some annuities and pensions),
- Beneficiary designations (IRA, 401k, 403b, some investment accounts)
- Trust assets?
2. What Assets are Probate Assets?
Any personal property assets owned by you, in your individual name, on the date of your death – without one of the non-probate designations:
- Individual bank accounts,
- Personal effects and home furnishings,
- Cash and uncashed checks earned or paid prior to death,
- Debts or accounts receivable owed to you on the date of your death,
- Business interests owned individually (LLC membership interest, corporate stock, or partnership interest – or the business itself if you’re a sole proprietor),
- Vehicles, motor homes, RVs, boats, etc.,
- Farm equipment,
- Any traditionally non-probate assets that are left to your estate.
3. How Much Does Probate Cost?
There are really three potential costs associated with Probate:
- The filing and notice fees (usually $120 and $115-130 depending on the newspaper),
- The Probate fee (0.4% of probate assets up to $6,000), and
- The Attorney’s Fee for assisting with the Probate proceeding ($1,000 – $10,000, depending on the matter and the Attorney).
4. How Do I Avoid Probate
There are three ways to avoid probate:
- Not owning anything on the date of your death – if you have no assets, your estate will have no assets to probate,
- Only owning assets in a non-probate designation (see the next FAQ below), or
- Utilizing trust-based planning to remove assets from your estate.
5. How Do I Support My Kids After I’m Gone
- Leave them assets in your will or trust – to be held for their benefit until they reach a certain age. Likely the guardian or trustee would hold the assets during their minority,
- Establish life insurance now so that there is money to support your kids after you’re gone, which will pay following your death.
- Give detailed instructions to the potential Guardian now, or have those instructions written down and kept with your estate plan in the event you pass before your kids turn 18.
- Make sure that whoever the Guardian will be, they agree with and respect your parenting method and the manner in which you wish for your children to be raised in your absence.
Having a plan well in advance of any unexpected illness or accident is key. Here at Dobson Law Firm, PLLC, we can help.