What happens to assets not covered by an estate plan?
On behalf of Scaringi Law posted in Estate Planning on Friday, January 23, 2015.
Although it may sound like the subject of a Hollywood movie, it’s not inconceivable that assets might be discovered after the close of probate. When this happens, the result may vary depending on the value of the discovered asset, individual state law and the decision of the probate court. In an extreme situation, an estate may need to be reopened.
Fortunately, this result can be avoided in most cases with an attorney who helps an individual take a proactive approach to estate planning. An attorney can help an individual make a thorough inventory of all property and assets.
Part of that inventory will require identification of non-probate property. As with assets titled in an irrevocable trust, non-probate assets also do not need to go through probate before passing to the grantor’s heirs. Although such property would not fit the scenario above, overlooking it could lead to unintended results. A commonly encountered situation is where the designated beneficiary on a contractual policy, like retirement or life insurance policies, hasn’t been updated to conform with an individual’s most recent intentions.
An attorney can help an individual plan for the disposition of any property acquired in the future. For example, the attorneys in our firm might recommend a pour-over will in conjunction with a trust. This type of will directs that all property that wasn’t titled in the name of a trust and is subject to probate should be transferred into the trust after an individual’s passing. Although court involvement is required to identify the property that will pass through the will, it is minimal compared to a full probate proceeding.