Probate courts in Indiana serve several important roles. They help to ensure that the distribution of someone’s assets complies with both state law and the instructions in a testator’s estate plan. Probate court oversight also helps to protect the legacy of a deceased person from misconduct and incompetence, but it can also put an individual’s plans at risk.
Probate proceedings can be very expensive, particularly if there is litigation involved. Beyond that, creditors, ranging from the Medicaid estate recovery program to credit card companies, can make a claim against someone’s estate. Those creditor claims can force the sale of someone’s assets and leave an individual’s beneficiaries with little or nothing.
Those who take the time to plan their estates often want to transfer as much of their wealth as possible to the next generation. Is it possible to keep a home or other real property holdings out of probate court?
Yes, there are strategies to transfer property without probate
Depending on whether someone owns a property on their own or jointly with another person, there are a variety of ways to potentially bypass probate courts when arranging for the transfer of real estate after someone’s death. Some people have deeds executed and stored to arrange for a transfer after death, but such arrangements are vulnerable both to issues involving lost paperwork and sizable tax burdens.
In situations where two spouses own a home jointly or where a parent wants their child who has lived with them as a caregiver to inherit the house, executing a deed can achieve this goal. Those who hold title as joint tenants with rights of survivorship will have their ownership interest pass directly to their co-tenants after they die. The probate courts will not have anything to do with that transfer.
Other times, people may choose to transfer ownership of their real property to a living trust. Living trusts can hold someone’s major assets and allow for an ownership transfer in specific circumstances. A trust can even allow one person, like a new spouse, to continue living in the house until they die or remarry. Then, the ownership interest in the property could transfer to the children or other beneficiaries selected by the testator.
There is no one specific solution that is ideal in every estate planning scenario. Reviewing one’s assets and legacy goals thoroughly with the assistance of an attorney can lead to the best strategy for keeping an individual’s most valuable property out of probate court in Indiana.