When you are creating your estate plan in Las Vegas, Nevada, you need to understand the differences between probate and non-probate assets. Understanding how probate works is a critical part of your estate plan when you are deciding how your assets will be divided among your surviving loved ones. Failing to understand how probate works can result in a more complex process for your loved ones after you have passed away.
To ensure you have created an estate plan that accounts for probate and non-probate assets, consider hiring an estate planning attorney to help with this process. At Morris Estate Planning Attorneys, our collective years of experience have equipped us with the knowledge to help our clients navigate the complexities of the estate planning process. Keep reading to find out the difference between probate and non-probate assets and how you can navigate this aspect of estate planning.
Understanding Probate in Las Vegas, Nevada
To better understand probate and non-probate assets, you need to understand how probate works in Nevada. Probate is the legal procedure where the title of assets are changed from the deceased person to the beneficiary of that asset. The probate court will usually be responsible for appointing a personal representative of the estate, taking asset inventory, ensuring claims are paid, and distributing the assets.
Although probate is there to ensure assets are distributed fairly and in an orderly fashion, it does have a poor reputation. This mainly comes from the fact that probate can be a lengthy process that also comes with costs, such as court fees, attorney fees, and executor or administrator fees.
The exact process of probate and how long it takes is largely dependent on the type of probate required, the nature and extent of the assets of the estate, the number of interested parties, and the relationship dynamics between the interested parties.
Probate and Non-Probate Assets
How the probate process will proceed depends on the probate assets you own at the time of your death. The good news is that there are some assets that fall into the category of being non-probate property, which excludes them from the probate process.
Probate
If you are wondering what the difference is between probate and non-probate assets, you first need to understand what assets fall into the probate category. Probate assets are owned solely by you, do not have a joint-owner, and are not designated to any specific beneficiaries. Because you are the sole owner of these assets, beneficiaries have to be designated in probate court according to what you have included in your will or according to Nevada’s laws of intestate succession.
Here are some examples of what could qualify as probate assets in Las Vegas:
- Bank accounts
- Life insurance policies
- Brokerage accounts
- Real estate property
- Personal property such as jewelry, vehicles, etc.
- Interest in LLCs, partnerships, or corporations
Non-Probate
Unlike probate assets, non-probate assets have an established co-owner, beneficiary, transfer on death (TOD), or payable on death (POD) designation, or are owned in a trust. These assets are not subject to probate court jurisdiction and will not have to be included in the probate process. Here are some examples of non-probate assets:
- Retirement accounts with listed beneficiaries
- Property that is held in a trust
- Property with joint tenancy or held as community property with rights of survivorship
- POD, TOD, or joint tenancy bank or brokerage accounts
- Life insurance and brokerage accounts with a listed beneficiary
For non-probate assets, the asset will go directly to the beneficiary, pursuant to the terms of the trust, or otherwise to the surviving co-owners/tenants who have the right of survivorship.
How to Avoid Probate in Las Vegas
Even though probate is an important process for many estates, it comes with some drawbacks for your remaining loved ones. Not only can this process feel very overwhelming, it can take quite a long time and incur significant fees that eat into their inheritance.
The good news is that there are some ways that you can be proactive and avoid probate when distributing your assets after your death.
- Designated beneficiary instruments: Financial instruments such as life insurance policies, retirement accounts, POD, and TOD options allow you to designate beneficiaries, so these assets automatically go to them, skipping the probate process.
- Joint ownership: You can hold your assets in joint ownership, which allows them to automatically go to the co-owner without having to go through probate, especially if they have a right of survivorship.
- Trust: A trust allows you to transfer your assets to it so that they are managed by a trustee. The assets can then be distributed by the trustee according to your instructions without the need for probate court, especially if you are using a revocable living trust.
Depending on who you are leaving your assets to, avoiding probate court may be your main priority. For example, you may want to ensure that your surviving spouse avoids probate fees and gets access to financial assets they need to pay off debt or replace your income.
Why You Should Hire an Estate Planning Attorney
Even if you do not believe you need help when creating your estate plan, hiring an attorney is a crucial part of ensuring everything is done correctly. Even if your estate seems simple, you need to follow the legal requirements in Las Vegas for your last wishes to be upheld.
An estate planning attorney will help you create your estate plan while keeping the best interest of your loved ones in mind. They can help you differentiate the difference between probate and non-probate assets and how you can get around much of the probate process. Not only will this give you peace of mind, it will ensure your loved ones are able to access all of the assets you leave behind.
Contact a Dependable Estate Planning Attorney at Morris Estate Planning Attorneys
Creating your estate plan is a critical step towards planning for the future care and comfort of your surviving loved ones. To ensure you have done this correctly and in the best way possible, you need to understand the difference between probate assets and non-probate assets and how the probate process works in Nevada.
At Morris Estate Planning Attorneys, our estate planning attorneys are dedicated to providing our clients with the guidance and knowledge they need when creating their estate plan. Contact us today at 702-471-0990 to schedule a meeting with one of our attorneys in Las Vegas, NV.