Most people know one thing about probate: that they want to avoid it. But why? What is probate, anyway? Is it really as bad as people make it out to be? The estate attorneys at Caress Law have compiled the following list of probate questions and answers to help you better understand what probate is, and how to avoid probate in Washington state.
1. What is probate, anyway? Probate is the legal process that ensures a deceased person’s debts are paid off, and that their assets are distributed properly. If the deceased person had a will, their assets are distributed following the instructions therein. If the deceased person died intestate—meaning, without a will—their assets will be distributed following state law.
Upon a person’s passing, a petition is filed in probate court, and the probate judge appoints an executor (in Washington, an executor is called a “Personal Representative”) to administer the estate. Again, if the deceased had a will, they most likely already named an executor who they trusted to pay off their final debts, and distribute their assets as outlined in the will. If there was no will, the judge will appoint an executor based upon a priority of appointment defined under state law.
After the petition has been filed, the deceased’s creditors, heirs, and beneficiaries will be notified, and—oftentimes—notice will be published in a local newspaper, opening the door for members of the public and unknown creditors to attempt to claim the deceased’s assets, if they feel they are so owed.
Probate is closed after all creditor claims have been addressed and assets have been distributed. This process can be quite time-consuming, and the longer it takes, the more it costs the estate.
2. Which assets are subject to probate? Assets that pass directly to a joint-owner, trust, or by beneficiary designation will bypass the probate process. These assets generally include jointly owned financial accounts, retirement accounts, pension accounts, life insurance policy proceeds, payable-on-death accounts and co-owned real estate assets with rights of survivorship designation, as well as any assets held in a trust.
Assets that will need to be probated include assets in your sole name without beneficiary designations such as:
- Bank Accounts
- Real Estate
- Business Assets
- Other Personal Possessions
Heirs cannot take legal ownership of these assets until the probate process has been completed.
3. Why do people care so much about avoiding probate? Probate has certainly been given a bad rap, but really, it’s an organized way of distributing a deceased person’s assets to their heirs or beneficiaries and paying their debts. However, there are a few reasons why avoiding probate is often more desirable:
- Probate is a public process, and many people prefer their assets and debts remain private…even after they pass away.
- If you own property in more than one state, your assets will need to be probated in each state. Obviously, this is a major hassle—and an expensive one, at that!
- The Court, not the family, controls the timing of the probate process and it is not a quick process. For those with complex estates, avoiding probate can save their loved ones time, emotional distress, and money.
4. The big question is this: how to avoid probate in Oregon and Washington states? There is no standard answer to this common question, as every individual’s situation is a bit different. We recommend speaking to a qualified probate attorney or estate planning lawyer to discuss your needs, wants, and goals. However, some ways to avoid probate in Washington state include the following:
- Establish joint ownership of property where possible
- Include beneficiary designations on retirement accounts
- Establish a pay-on-death or transfer-on-death account
- Work with an attorney to create a trust
- Give away your assets as you age, but stay abreast of constantly-changing laws outlining how much you can give away, tax-free
Please keep in mind that there are other relevant factors (such as taxes!) that need to be considered before implementing one of the above probate avoiding techniques, and we highly recommend speaking with your estate planning or probate attorney before moving forward with any course of action.
There are more probate questions and answers than we can cover in one article, but the above should provide a wealth of information about what probate is, which assets are subject to probate, why many people go out of their way to avoid probate, and how you, too, can keep your estate out of probate.
The estate planning attorneys at Caress Law, PC can help you understand and navigate the estate planning, probate, and estate & trust administration processes. Contact us using the brief form below, or by calling (503) 292-8990 today.