When you pass away, your assets will be categorized as either probate or non-probate. This will decide how and when your assets are distributed to your beneficiaries, so it’s helpful to learn which category your belongings will go into. You should get an idea of the difference between probate and non-probate assets and then talk to a Minneapolis estate planning lawyer if you have any questions.
What Are Probate Assets?
Any property you have that is considered a probate asset will go through probate court before being distributed to your beneficiaries. This can take extra time, which means your beneficiaries may have to wait for a few months before getting access to any probate assets you leave them.
In general, probate assets are any items that you owned by yourself during your life. These include:
- Real estate that was solely in your name, not jointly held with anyone else
- Personal property, such as electronics, furniture, and household objects
- Vehicles in your name
- Bank accounts in your name
- Life insurance policies that name you or your estate as the sole beneficiary
- Interest or ownership in a corporation, partnership, or LLC
These are the most common types of probate assets. An estate planning lawyer can determine if you have any additional assets that need to go through probate before being distributed to your beneficiaries.
What Are Non-Probate Assets?
Non-probate assets can skip the probate process and be transferred straight to the beneficiaries. This makes it simpler and faster for them to get your assets, which is why many people try to set up their assets as non-probate items whenever possible.
Non-probate assets are usually items that are jointly held in someone else’s name as well as yours, meaning they automatically become the owner when you pass away. These are some of the most common examples of non-probate assets:
- Life insurance policies that list a family member as the beneficiary
- Real estate property that is held in joint tenancy
- Bank accounts held in joint tenancy
- Retirement accounts, such as IRAs and 401(k)s
- Accounts with a payable on death or transfer on death deed
- Property that is owned by a living trust
Your lawyer can help you find ways to leave mostly non-probate assets to your beneficiaries whenever possible. For example, you can transfer your assets to a living trust to prevent your property from going through probate court when you pass away.
Do You Have Questions About Probate?
It’s not always easy to understand what makes some properties probate assets and others non-probate items. So, if you have questions about this designation or want to find out if there’s a way to get more non-probate assets to leave your beneficiaries, you should talk to an estate planning lawyer.
If you are ready to discuss your estate planning choices and get fast answers to your legal questions, call our Minneapolis law firm at 612-448-9653 to talk to our attorneys.