How to Avoid Probate in Florida
Probate is the court supervised process of transferring the property of a deceased individual — held by a legal entity called an estate — to the legal heirs of that person. The process is designed to be simple and streamlined. But as a practical matter, probate administration can be both lengthy and costly. This can delay and reduce the disbursements each heir receives and it is why many attorneys recommend taking steps to avoid probate if possible by using a number of estate planning tools.
Holding assets such as bank accounts and real estate jointly can remove some assets from your probate estate. This is because when an owner of a joint asset dies, full ownership transfers to the surviving owner or owners by operation of law without the need for probate. Accounts, investments and insurance policies that designate a beneficiary also transfer on death by operation of law. Unfortunately, jointly titling assets does not aid in reducing or avoiding estate tax implications, may have gift tax implications at the time of transfer, and may also expose assets to the creditors of other joint owners. As such, this method may not be suitable for all circumstances.
Another popular but more complicated method of avoiding probate is the use of a living trust. While trusts come in various types, in a living trust, a person creates a self-settled revocable trust to hold his or her assets. Upon the settlor’s death, the trust is administered by its own terms without the need for intervention by a probate court. Moreover, using what is called a credit shelter trust arrangement can reduce or eliminate estate tax liability for some married couples with larger estates.
Information provided is of a general nature and does not act as a substitute for a personal discussion with an attorney. Your circumstances may create different legal opportunities.