Probate is a Surrogate’s Court process that allows for the legal administration of a decedent’s estate. Probate becomes necessary any time a decedent has passed away while owning property in his or her sole name. For those assets, the family has no legal authority to collect assets, pay expenses, or handle any and all final affairs until the Court has confirmed and appointed an estate representative, i.e. the Executor (nominated in a Will) or Administrator (where the decedent died without a Will).

Probate proceedings often can be expensive, time-consuming, and confusing for the surviving family members. The Probate process may cause strife and turmoil amongst an otherwise harmonious family. The last thing your family wants to deal with is a legal proceeding involving voluminous paperwork, attorneys’ fees, and court filing fees, as well as strict timelines, all while grieving their loss.

Furthermore, Probate proceedings subject your estate to creditors’ claims and administrative costs before your family can inherit anything from you.

Lastly, Probate proceedings become a matter of public record, with the intimate details of your final affairs being fully accessible to the public.

One can avoid Probate through some simple techniques …


Living Trusts

In New York State, you may avoid probate by moving your assets into a Living Trust. For example, you can move your home, your investment accounts, your life insurance policies, and your bank accounts into the Trust and avoid probate for the entire Trust estate. Upon your death, the terms of the Trust document will control the distribution of assets to your beneficiaries. Living Trusts are private and require no court intervention upon your death.


Joint Ownership

This is one of the most common methods for avoiding probate. Many married couples utilize this method without even realizing it. If you own property with another person and share the “right of survivorship” on the property, the surviving owner automatically retains full legal rights to 100% of the property by operation of law. For example, a husband and wife maintain a joint bank account. When the husband passes away, the wife will still own the account and does not have to go through the Probate Court to gain access to the funds.


Payable on Death/Transfer on Death Beneficiaries

This is another one of the most common methods to avoid probate. Listing a beneficiary on an account, like a life insurance policy or investment account, ensures that the beneficiary will receive the inheritance automatically and by operation of law upon your passing. After your death, the designated beneficiaries simply have to contact the financial institution to report your death and submit the death certificate (and required claim forms) and they will receive the disbursement.

This method may be especially helpful to those that wish to avoid probate but don’t feel comfortable listing someone else on their account as a joint owner.


Deed Transfers with Retained Life Estate

Another option to protect your house from probate involves transferring the deed to your loved one while maintaining your own rent-free life use and control during your lifetime. In other words, you can transfer the deed to your house to your children, but with the condition that you can live there for the rest of your life. You cannot be evicted or charged rent. You keep all of your tax exemptions and remain responsible for all taxes, maintenance, and upkeep. Upon your passing, the house automatically passes to the “remaindermen” (the person entitled to receive a particular estate on its determination) named on the deed and they do not need to commence a probate proceeding in order to transfer or sell the house.

Another perk to this type of deed transfer is that it can ultimately protect your house from a nursing home once you have cleared Medicaid’s look-back period.

If you have any questions about the above material or wish to speak to an attorney, please contact us at (716) 204-1055.

estate planning, Long term care, Medicaid