When someone dies, they can no longer own property. Therefore, any property found in the decedents estate at time of death must go through probate. The probate process is a complicated and time-consuming judicial process that involves determining whether there is a valid will, identifying assets, paying taxes, settling debts, and distributing assets to beneficiaries. Alternatively, if you plan accordingly, there are a range of possible ways to avoid the probate process in whole or in part.
Revocable living trust
One way to avoid probate is with a written document called a revocable living trust. A revocable living trust allows the creator to place any assets and property in the trust during his or her lifetime and then act as trustee to manage the assets for the benefit of beneficiaries. Moreover, you can still retain ownership over the assets during your lifetime. Then, at the time of death, none of the assets in the trust will be subject to the probate process.
Another way to avoid probate is by taking advantage of joint ownership. When two people are legally joint owners of an asset, then the asset automatically passes to the surviving person when one of them dies. Joint bank accounts or joint tenancies are two common examples.
Many states, including Ohio, permit the use of payable on death or POD accounts. A POD account allows you to designate a beneficiary who will receive the balance of your bank account upon your death. It is comparable to designating a beneficiary on a life insurance policy.
One last possible way to avoid probate is to gift your property to friends and family during your lifetime. If you give everything away, there will be no property in your estate at death to be probate. An obvious draw back to this approach, however, is that you will no longer be able to enjoy the property during your life time.
Ultimately, probate is relatively easy to avoid if you take the right steps, though it might not be the right option for everyone. An experienced estate planning attorney will be able to help tailor an estate plan that best suits your needs and wishes.