The Interplay Between a Will and the Probate Process
Many people believe that if they have a Will, their estate will avoid probate – and this is not true. A Will does not automatically make probate unnecessary, but it does make the process easier.
Probate is the process of transferring a deceased person’s “probate property” using the court system. Probate property includes, but is not limited to, assets held in the decedent’s name alone (without designation to whom the property should pass upon death) and assets held with others as “tenants in common.” A typical probate asset could be real estate owned only in the name of the decedent, an individually owned brokerage account, or an individual checking or savings account. Assets that pass outside of probate (“non-probate property”) typically include property held in joint tenancy (which means rights of survivorship) and assets that allow a person to designate a beneficiary to receive the property upon their death. A typical non-probate asset could be real estate owned jointly with a spouse or a joint brokerage account. Upon the death of one owner, the asset would automatically pass to the surviving owner.
Under the current laws, when a person dies with probate property in excess of $75,000, their estate must proceed through the probate process so that the property can be collected and distributed. The personal representative of the estate works with the probate court to determine the validity and effect of the Will, and how the assets are to be distributed. If there is no Will in place, the Minnesota intestacy laws apply. This means that the state of Minnesota determines how your probate property is distributed.
It is important for those updating or creating an estate plan to understand the probate process and the property potentially subject to the probate process. Understanding the probate process allows you to create an estate plan that appropriately directs your assets to your selected beneficiaries.
Stay tuned to FMJ’s Trust & Estates blog for more information on common misconceptions in estate planning.
This post was written by Trusts & Estates attorneys David Ness and Matt Jensen. If you have any questions or would like to discuss your estate planning options, contact David at firstname.lastname@example.org or Matt at email@example.com.