Why is it so important to avoid probate?
As you grow as a family and your financial situation changes, your estate plan will need to evolve. It is not uncommon for people to start with basic estate planning documents such as a Last Will & Testament, but over time, they may revise their plan to include additional objectives. To avoid probate is one of the most common goals that are added to an estate plan as it matures. To encourage you to create a comprehensive estate plan that covers all your estate planning goals, the Indianapolis attorneys at Frank & Kraft explain why avoiding probate is so important.
Understanding the Probate Process
Probate refers to the legal procedure that often follows an individual’s death. This court-supervised procedure is designed to ensure estate assets are located, valued, and debts and taxes paid. The remaining assets will be distributed to beneficiaries or heirs. The process includes verifying a Will, if one was left by the decedent. The probate court will use Indiana’s intestate inheritance laws to determine how assets are distributed when there is no Will. Why Avoiding Probate is a Common Estate Plan Goal
Many people take steps to avoid probate during their lifetime. Probate is a legal requirement, but it can be a time-consuming process for the surviving family members. Indiana law requires that creditors be given three months to file claims, even if the estate is relatively simple. It may take five to six months for probate to be completed, while more complex estates can take up to a year. Estates that require asset liquidation or involve disagreements between heirs can be held up in court for many years. Meanwhile, family members may be unable to access the decedent’s assets until the estate is officially closed, creating unnecessary financial hardship.
Cost is another major factor. The probate process is accompanied by a variety of fees and expenses. Attorneys, accountants and appraisers are usually entitled to compensation. These expenses are paid from the estate directly before assets are passed on to heirs. This reduces the value of the entire estate. In some cases, this reduction can be substantial enough to significantly impact what each beneficiary receives.
Privacy is also a concern for many individuals. Once a Will has been submitted for probate it becomes public record. Anyone can view the Will, as well as any supporting documents, court filings and records of any legal issues or disputes that may have arisen during the probate process. The public nature of probate may not be ideal for those who value discretion or wish to avoid potential conflict between family members. If an estate is the subject of formal probate proceedings then the court can require approval for a number of actions. This includes the sale of estate properties, settlement of debts and final distribution. Many people prefer to make arrangements in advance that limit or eliminate the court’s role in overseeing what they believe should be personal matters. How to Avoid Probate In Indiana
To avoid probate, you can incorporate strategies in your estate plan that transfer assets directly to beneficiaries. Revocable living Trusts are the most popular tool for this purpose. When assets are placed in a trust they are not considered part of the probate estate. They can be transferred directly to beneficiaries without having to go through the court system. Join us for a FREE seminar to learn more about avoiding probate. For more information, please join us for an upcoming FREE seminar.
