For some, the probate process can be a daunting responsibility that must be undertaken after their loved one has died. Most people are unfamiliar with the process and may be unsure even where to begin. One of the most surprising things people learn while probating an estate is that not all assets are distributed through the probate process, but rather are distributed to persons outside of probate. These assets are referred to as “non-probate assets” while the assets that do go through probate are called “probate assets.”
So, what is the difference between “probate assets” and “non-probate assets?”
Non-probate assets already have a designated beneficiary (or beneficiaries) that will receive the asset following the death of an owner. Common types of non-probate assets include things like property/financial accounts owned with another person as joint tenants with right of survivorship (JTWROS) or any assets that have a beneficiary designation (such as life insurance policies, IRAs, 401k, and other financial accounts that have a pay on death (POD) beneficiary or a transfer on death (TOD) beneficiary). Alternatively, “probate assets” are assets that go through probate and are passed down to the decedent's beneficiaries or heirs after they are first used to satisfy any debts and creditor claims to the decedent's estate.
Smart use of beneficiary designations will allow some assets to get in the hands of loved ones faster because they don't need to go through probate. At Peach State Wills and Trusts, we help clients with settling their loved one's estate through uncontested probate and help people prepare their own estate planning so they have the confidence of knowing that their assets will be distributed as they wish, and the right people will be in charge of the process. For help with these issues, we invite you to call us at 678-344-5342 or contact us here.