Do All Wills Go Through Probate?

Probate is the legal process that happens after someone dies. It distributes the assets and pays any debts or taxes. If there's a will, you might wonder if probate is needed. Sometimes, probate is required to validate the will and settle the estate, while in other cases, it can be avoided. You should understand your local laws and how they could apply to your estate plan.

If you're concerned about probate, a financial advisor can work with you to create an estate plan.

Do All Wills Go Through Probate?

Whether or not a will goes through probate depends largely on the size of the estate, the types of assets involved and the specific laws of the state where the person lived. In most cases, wills do go through probate, especially if the estate includes assets that are solely in the deceased person’s name or if there is a need to resolve disputes among heirs or creditors.

However, there are situations where probate may not be necessary. For example, if the deceased’s estate is small or includes assets that automatically transfer to another person upon death, you might avoid or simplify the probate process.

Some states, such as Texas, allow smaller estates to qualify for a simplified probate process, known as a small estate affidavit . This can significantly reduce the complexity and duration of probate.

How Can I Avoid Probate?

There are several ways to avoid probate and simplify the process of transferring assets after death. These estate planning strategies can help you pass property and financial accounts directly to heirs without going through probate. Here are four to consider.

Jointly Held Assets

One way to avoid probate is by holding property jointly with someone else, such as a spouse or family member. In cases of joint tenancy with right of survivorship , when one owner passes away, the property automatically transfers to the surviving owner without the need for probate. This applies to real estate, bank accounts and other assets held in joint ownership. It's important to make sure that the property title explicitly states joint ownership with the right of survivorship, as this ensures the seamless transfer of ownership upon death.

Similarly, in community property states like California, spouses may hold assets as community property with the right of survivorship. Upon the death of one spouse, the property passes directly to the surviving spouse without probate.

Property With Named Beneficiaries

Certain financial accounts and assets, such as retirement accounts, life insurance policies and payable-on-death (POD) or transfer-on-death (TOD) accounts, allow you to name a beneficiary. When you name a beneficiary, these assets are transferred directly to that person upon your death, bypassing probate. It’s important to keep beneficiary designations up to date, especially after major life events like marriage, divorce or the birth of a child.

These beneficiary designations override what's stated in a will, so even if a will is probated, these assets will not be included in the probate process as long as the designations are valid and current.

Property in a Revocable Living Trust

Placing assets into a revocable living trust is another way to avoid probate. A revocable living trust allows you to manage your assets during your lifetime and transfer them to beneficiaries upon your death without going through probate.

Since the trust, not the individual, holds legal title to the assets, those assets do not need to be probated. After your death, the designated trustee will manage and distribute the assets according to the terms of the trust, bypassing the court-supervised probate process.

Small Estate

In many states, small estates may be able to avoid probate altogether or go through a simplified probate process. In Texas, for example, if the total value of the estate is less than $75,000 and meets other specific criteria, heirs may use a small estate affidavit to settle the estate without formal probate. This process is faster and less expensive than traditional probate, and is often used when there is no real estate involved or the estate consists mostly of personal property.

Frequently Asked Questions

Is Probate Required If There Is a Will?

Yes, in most cases, probate is required even if there is a will. However, if the estate contains non-probate assets such as joint brokerage accounts or assets with named beneficiaries, probate may not be necessary for those assets.

What Happens If an Estate Does Not Qualify for Small Estate Procedures?

If an estate does not qualify for small estate procedures, it must go through the regular probate process, which can be lengthier and more expensive. The estate will go through the court system to settle debts and distribute assets according to the will or state intestacy laws.

Bottom Line

While many wills do go through probate, it's possible to structure your assets in a way that allows them to bypass the probate process. Jointly held assets, accounts with named beneficiaries, living trusts and small estates are common estate planning strategies used to avoid or simplify probate. A probate lawyer can also provide further insights into how to manage your estate, but the bottom line is that careful estate planning, while complicated, is the best solution to ensure that your final wishes are honored.

Estate Planning Tips

• A financial advisor could help you create an estate plan to manage and distribute assets to your beneficiaries. Finding a financial advisor doesn't have to be hard. SmartAsset's free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you're ready to find an advisor who can help you achieve your financial goals, get started now .
• If you want to save some money and create an estate plan on your own, here are some common pitfalls that you should avoid .

Photo credit: ©iStock.com/PeopleImages, ©iStock.com/thodonal, ©iStock.com/YakobchukOlena

The post Do All Wills Go Through Probate? appeared first on SmartReads by SmartAsset .