The probate process can be a cumbersome, costly, and stress experience. For these reasons, people are quick to avoid it – although this is easier said than done.
However, with some prudent thinking and the help of a tax and estates lawyer, you can skip probate court, saving yourself time and money.
Here are three ways to avoid probate in North Carolina:
Living Trusts
Living trusts, unlike wills, are not subject to the probate process. When a trust is created, the testator (the person creating the trust) transfers his assets into the trust. The testator then names beneficiaries – the people who will receive the trust’s assets – and a successor trustee to manage the trust after he dies.
It’s important to note that setting up a trust has its own costs, but for wealthier individuals these costs are generally less than probate fees, which are taken as a percentage of the estate.
Joint ownership of property
Usually, when a person dies, all their property enters probate, including their house. This happens even if their significant other is alive and still occupying the house.
However, this scenario can be avoided by making one’s spouse a joint owner of the property. Joint ownership creates what is known as “the right of survivorship” which grants the joint owner full ownership of the property when the other owner dies.
Payable-on-death designations
Certain bank accounts, such as checking and savings accounts, can be designated as payable-on-death.
Simply put, you retain complete of the accounts, and the money in them, for the remainder of your life. When you die, control of the accounts is transferred to the beneficiary.
Executing the above strategies requires an in-depth understanding of estate law, making the help of an experienced trusts and estates lawyer necessary.
A lawyer understands the subtleties of the law and can recognize issues a lay person may never contemplate. They can then craft a personalized plan around the unique objectives of the client.