Non-Probate Assets
Aug 27, 2010 / By: Jennifer Stein, Estate Administration Coordinator / Category: ProbateIf you do not make a Will before you die, your assets are placed in probate. However, there are some assets that are not placed in probate regardless of whether or not you have a will. These assets are called non-probate assets.
What are Non-Probate Assets?
Some types of assets are part of your non-probate estate since they are contractual in nature. Non-probate assets can include assets:
- You own jointly with other peoples, such as your spouse, as joint tenants with right of survivorship. When you die, your portion of the property is automatically transferred equally to other owners of the property.
- Owned by your Revocable Living Trust.
- Owned as a life estate. After your demise, the life estate is passed to the remainder beneficiary.
- Owned by you and transferred to your designated beneficiary after your death. These assets include Payable on Death (POD) accounts, Transfer on Death (TOD) accounts, Totten Trusts and In Trust For (ITF) accounts. Life insurance policies, retirement accounts, health savings accounts (HSAs) and medical savings accounts (MSAs) are also included in these assets.
Although your non-probate assets can avoid probate, their value will be included in the value of your gross estate when your estate tax liability, if any, is determined.
Pyke & Associates, P.C. is a member of the American Academy of Estate Planning Attorneys.
