In previous blog posts, we emphasized the importance of proper estate planning so your loved ones know how to distribute your assets at the time of your death. One of the main reasons we advise our clients to invest time and money in proper estate planning is so that their property does not go through the Probate court process. This post will give a brief background of Probate, why some people seek to avoid it, and steps you can take to turn your property into non-probate assets.
Probate at a Glance
Probate is the process through which a dead person’s, called a “Decedent”, assets are distributed to his or her heirs through the Probate Court. However, it is not as easy as submitting a Will to the court and then waiting for a check. Before any of the Decedent’s property can be distributed, somebody needs to be appointed either the Executor of the estate if the Decedent had a Will, or Administrator of the estate if the Decedent did not have a Will. For purposes of this blog, we will refer to that person as the “Representative.” The Representative is responsible for submitting the Will to the Probate Court, if applicable, sending notice to creditors and beneficiaries, identifying and inventorying the Decedent’s property, appraising and potentially selling the Decedent’s real estate, paying the Decedent’s taxes and debts and, then finally distributing the assets according to the Decedent’s wishes in the Will, or by Illinois law.
Why Do People Want to Avoid Probate?
While Probate is sometimes necessary to distribute a Decedent’s assets, there are valid reasons why people seek to avoid Probate Court when creating their estate plans.
First off, Probate can be an expensive process. There are court filing fees, creditor notice fees and attorney’s fees, if you hire an attorney to help with the probate process. Additionally, the Representative of the estate is entitled to compensation for their time and expenses paid to carry out their role in administering the estate. Secondly, the probate process can take a long time. On average, a probate case takes between six to nine months. During this process, the Decedent’s heirs will not have immediate access to the Decedent’s money and may be responsible for paying for the Decedent’s funeral, burial, and maintenance and insurance for real property or vehicles, among other expenses. These items can be costly and can cause huge stresses on family members during a difficult time.
How Can I Avoid Probate?
As an initial matter, if you own less than $100,000.00 in assets, you can avoid the probate process in Illinois by completing and signing a Small Estate Affidavit. With a Small Estate Affidavit, the Decedent’s property can be transferred without court involvement.
However, even if you own more than $100,000.00 in assets at the time of your death or own real property, there are other ways to plan so your assets do not pass through probate*:
1. Put your assets into a Revocable Trust. With a properly drafted and funded Revocable Trust, your assets will be titled in the name of the trust and will avoid passing through probate.
2. Designate a beneficiary for insurance policies, investment, and retirement accounts. At death, the assets or proceeds will automatically transfer to your named beneficiary.
3. Real Estate held jointly with survivor’s rights will not go through probate. The property will pass directly to the joint owner.
4. Payable Upon Death or Transferable upon Death notations in paperwork for vehicles, bank accounts, investment and retirement accounts will help these assets go straight to the beneficiary and avoid probate.
No matter your thoughts on the Probate process, having a properly drafted estate plan will ensure that your assets are distributed according to your wishes. The Law Office of Kate Curler LLC is prepared to put together an estate plan that suits your needs. If you have questions about probate or planning generally, please contact Attorney Lauren Kaplan at lkaplan@curlerlaw.com or (312) 952-1077 for a free consultation.
*This list is not exhaustive, and you should consult with an attorney to make sure all of the assets you want to avoid probate are properly titled.