Planning how your assets will be distributed after you die can be an uncomfortable undertaking. But ignoring important estate planning decisions can create a headache for your beneficiaries in Probate Court once you are gone.

What Is Probate?

Probate is a legal process that determines who benefits from the decedent’s estate. The Probate Court appoints a Personal Representative to administer the estate. The estate administration entails collecting all the decedent’s assets, paying their debts, and distributing the property to the correct individuals.

Under Massachusetts law, if the decedent leaves a will, the beneficiaries of the estate are those named by the decedent; if there is no will, the beneficiaries are determined by state statute.

Massachusetts law also provides that creditors of estates can make claims for debts against the estate for one year after the date of death. If a claim is made against the estate, and the Personal Representative distributed all the estate assets, then he or she is liable for the debt claim. Therefore, the Personal Representative’s job is usually a commitment that lasts at least a year, often much longer.

What Kind of Property Is Relevant for Probate?

Probate property is anything the decedent held in their name alone. This can include bank accounts, business interests, real estate, brokerage accounts, stocks, and personal property (including vehicles, household furnishings, jewelry, clothing, boats, collectibles, art, and so on).

Property that does not fall within the purview of probate includes:

  • Jointly held property with a surviving owner (bank accounts, real property titled as owned jointly with rights of survivorship, joint property held by married couples and designated as joint tenant by the entirety)
  • Trust property
  • Property with beneficiary designation such as:
    • Life insurance
    • Bank accounts with transfer on death or payable on death designations
    • Retirement accounts
    • Annuities

These forms of non-probate property pass to the new owner without the Probate Court involvement. For example, if you hold all your assets in a trust, when you die, your beneficiaries will not have to go through the Probate Court process to access your assets. Your named Trustee will have immediate access to the assets of the Trust.

Why does it matter? If your assets are not held in a trust, your family will have to wait for the court to appoint the Personal Representative to begin administering the estate. This can create delays, especially involving the sale or transfer of real estate, which is often your most valuable asset.

Proper estate planning can completely avoid the headaches of probate. It’s well worth taking time today to think about your assets and how they are titled during your life. Our attorneys at Mountain Dearborn can help craft an estate plan tailored to your needs, a plan that avoids probate and helps you to achieve your goals.