Grand Junction Estate Planning Lawyer
Probate is a court procedure for settling the estate of a deceased person. The procedure is designed to insure that creditor claims and taxes are paid and that any remaining assets are transferred to the beneficiaries according to the terms of the deceased person's Will. If the deceased died without a Will (or other estate plan such as a Trust) , he is said to "have died intestate" in which case his estate is distributed to his closest living relatives.
Under Colorado law a person's estate is subject to Probate if he dies owning: (1) titled personal property with an aggregate value of $63,000 or more; or (2) real estate of any value. While Probate in Colorado is less complicated and less expensive than in many states, it typically costs 2-5% of Probate assets and takes a minimum of one year to complete. As a result, many of us are interested in developing an estate plan that circumvents Probate.
Assets that are not subject to Probate include the following:
- Gifts made prior to death
- Assets held by a Living Revocable Trust
- Pension Plans or IRAs with a named beneficiary
- Life Insurance and Annuities with a named beneficiary
- Bank Accounts with a Payable On Death (POD) designation
- Brokerage Accounts with a Transfer on Death (TOD) designation
- Real or Personal Property held in Joint Tenancy with another person
- Titled Personal Property with an Aggregate value of less than $63,000
Tools to Avoid Probate
The primary Estate Planning tool used to avoid Probate is a Living Revocable Trust (LRT). Think of a LRT as a Will that is not subject to Probate. Like a Will a LRT specifies how your estate is to be divided after your death and it can be modified at any time during your lifetime. However, unlike a Will the Trust provides for a Trustee (as opposed to a Personal Representative) to administer the estate and no court involvement is required.
The second means of avoiding Probate is by naming a beneficiary for any assets that otherwise would be subject to Probate. Caution: This approach which is often referred to as "Transfers by Operation of Law" or "Will Substitutes," works very well for extremely simple estates with no minor beneficiaries, but a LRT is preferable and safer for most families.
Examples of Transfers by Operation of Law include executing a beneficiary deed to your house; making a Payable on Death beneficiary designation on your bank accounts and C.D's; and specifying a Transfer on Death beneficiary designation on your investment accounts.
Estate Planning Lawyer in Grand Junction
The Law Offices of James A. Littlepage, a Grand Junction Estate Planning firm, has been assisting families in Probate avoidance since 1993. Mr. Littlepage has prepared over 2,000 estate plans and recently was recognized with a 2015 and 2016 Five Star Estate Planning Attorney℠ award. In 2014, 2013, 2012, 2011 and 2010 he received the Five Star Wealth Manager℠ award, as seen in 5280 and ColoradoBiz magazines. For assistance in Probate avoidance planning that is tailored to the needs of your family, please contact our Grand Junction office for a free 30 minute consultation for estate planning and probate.
Contact the Grand Junction Estate Planning Lawyer at the firm for help with Probate Avoidance.