When someone dies the assets owned by the deceased must be accounted for and transferred to the intended beneficiary or heir of the estate. Probate is the legal process by which these goals are accomplished. Formal probate can be a time consuming and costly process. The good news is that formal probate is not always required in Missouri.
Upon the death of an individual the law requires that the deceased’s property be accounted for before it can be passed down to heirs or beneficiaries. To ensure that this is done properly the law requires most estates to pass through probate. During probate in St Louis Missouri, all of the decedent’s assets must be located, valued, and inventoried. In addition, all creditors of the estate must be given the opportunity to file claims against the estate and all taxes of the decedent and the estate must be paid. Depending on the size and complexity of the estate, formal probate can easily take over a year to complete. Missouri does offer alternatives to formal probate for estates with minimal assets; however, unless an estate qualifies for a small estate alternative the beneficiaries of the estate will have to wait out the probate process before any assets are transferred to them.
Because of the time and expense involved in formal probate, probate avoidance is a popular estate planning objective. While it may not be possible for your estate to completely avoid probate it is typically possible to remove the majority of an estate’s assets from the probate process with careful estate planning. The reason this is possible is that not all assets are required to go through probate. Some common probate avoidance tools and techniques include:
- Trusts – assets transferred into the right type of trust are no longer legally owned by the decedent and, therefore, are not included in the probate of the estate.
- Life Insurance – proceeds from a life insurance policy are not included in the probate of an estate.
- Joint tenancy – when property is properly jointly titled the decedent’s interest in the property will transfer automatically to the co-owner without it having to go through probate.
- POD/TOD accounts – certain types of financial accounts and securities can be titled as “payable on death” or “transfer on death” which allows the assets held in the account to automatically transfer to a designated beneficiary upon the death of the account owner.
By utilizing available estate planning tools and strategies such as these you can create an estate that spends minimal time in probate upon your death.
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