Probate (proh-bayt), n. 1. The judicial procedure by which a testamentary document is established to be a valid will; the proving of a will to the satisfaction of the court. vb. 1. To admit a will to proof. 2. To administer a decedent’s estate.
I find myself breaking out the old Black’s Law Dictionary every now and then just to confirm that “probate” is not in fact defined as a “plague” or “the black death.” I frequently hear people discuss probate like this but when I ask them why most people don’t know or cite some ill-gotten facts about cost and time.
First, the cost shouldn’t scare anyone away because, at least in Pennsylvania and many other states, it’s tied to the value of the estate assets. Even if the executor decides to hire an attorney to help with the distribution of the estate, most attorneys are more than happy to provide just as much help as the executor might need to guide them through the administration process. A retainer is usually required to acquire the attorney’s services initially, but the final cost is still paid as an estate administration expense and is deductible on the estate tax return.
Second, the time probate requires is not excessive. Yes it will take a number of months to tie up everything and close the estate but that pales in comparison to the upkeep of a living trust designed to avoid probate. They will have to be maintained for all the years between when it is created and the year you eventually die. Plus, if for any reason you forget or decide to hold an asset personally instead of in trust, you will still have to go through probate for those items.
As a matter of fact, most people hold their assets in ways that will pass outside their will and the probate process anyway. Any asset that you own jointly with a right of survivorship, like your family bank accounts, house, and cars, will pass right to the joint owner. Plus, retirement plan benefits, life insurance, individual retirement accounts, and annuities all pass to their named beneficiaries outside of probate.
Don’t get me wrong, there are many reasons to avoid probate and you should get some advice about what is in your own best interest. You might own a highly complex estate, have a high profile and wish to avoid publicity, hold estate assets well in excess of the $3.5 million estate/death tax exemption, or know your family is going to dispute your will and you want a stronger document. Ultimately it just doesn’t make sense for most people to spend any time, money, or effort to avoid probate.
So is it worthwhile to avoid probate? Don’t just take your crazy Uncle Johnny at his word, talk to a professional who can give you the proper guidance. Remember, the last time Uncle Johnny told you to trust him with a decision about life you ended up with matching Chuck Norris tattoos.
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Amen! I have often wondered why the average person would even consider trying to avoid probate. Probate is a straightforward process. A good estate team (attorney, accountant, appraiser, liquidator) keeps the process moving forward.
Crazy uncle Johnny probably doesn’t have any assets to probate anyway.