Over the course of conversations with many of our estate planning clients, one common theme occurred to us: We spend a significant amount of time with every client explaining the basics of probate and probate assets. As lawyers, we have to make sure our clients are as informed as possible before heading into court. But most of the time, knowing even the basics is helpful.
What is Probate?
Probate is the legal process where the court and beneficiaries settle final claims against the decedent and distribute probate assets. The county in Tennessee where the decedent lived when they died is where the court handles probate. Within that county, a specific court handles probate matters. The name of the court varies slightly from county to county.
Ultimately though, all of the probate courts in Tennessee follow the same Tennessee law, so the process is similar in each court. Every probate will be slightly different because the facts will be different for each decedent. Was there a Will? Was there a Trust? Are any estate recipients minors? Are there any creditors of the estate? There are many variations on what probate can specifically entail.
What Are Probate Assets?
The definition of a “probate asset” is important for our understanding of the probate process. This is because probate only distributes probate assets. In the most basic definition, a probate asset is something that is owned individually by the decedent. However, this definition has quite a few exceptions and additions. It may be easier to define a “probate asset” by focusing on what it is not, or by the “non-probate assets.”
Non-probate assets do not have a legally designated beneficiary. The most common example of this is life insurance. Life insurance usually has a designated beneficiary to whom the money will flow almost immediately upon a person’s death. The probate court does not consider this transfer except to note the amount of the life insurance the recipient receives.
Examples of Non-Probate Assets
One lesser-known example is a payable-on-death (POD) beneficiary for a basic checking or savings account. Most of the time, you can designate a POD beneficiary on the bank accounts you own. This will allow the bank to immediately transfer that account to your beneficiary upon your death, removing the bank account from probate.
Assets that are owned jointly by spouses are also typically non-probate assets. Homes are commonly non-probate assets. A home bought by a married couple will automatically belong to the surviving spouse. A word of caution here if you are a married couple, be sure that both your name and your spouse’s name are on the deed! If the property is only titled in one spouse’s name, this does not apply and the home would be a probate asset.
Contact the Estate Planning Attorneys at Tressler & Associates
Hopefully, this is a helpful explanation of probate and probate assets. Our attorneys would be glad to walk you through the process of discussing what probate would look like for your loved ones and strategize on how to ease that process. Quite a few assets can be removed from your probate estate by simple changes. We would be honored to show you how. For help with planning your estate, contact our estate planning attorney today.