When planning your estate, knowing which assets are exempt from probate is important. In Massachusetts, certain assets skip the probate process entirely, making the transfer to your beneficiaries quicker and more efficient. These exemptions can help ease the burden on your loved ones during a difficult time. At Surprenant & Beneski, P.C., we can help you understand the types of assets that do not require probate and how they can benefit your estate planning strategy.
Jointly Owned Property
Jointly owned property refers to assets held by two or more individuals with rights of survivorship. In Massachusetts, when one owner passes away, their share of the property automatically transfers to the surviving owner(s) without going through probate. This arrangement applies to various types of assets, such as real estate, bank accounts, and investment accounts. Joint ownership ensures a seamless transition, reducing the legal complexities and time involved in asset transfer. By setting up property as jointly owned, you can provide a straightforward way for your loved ones to inherit these assets without the need for probate proceedings.
Beneficiary Designations
Beneficiary designations are a straightforward way to ensure certain assets bypass probate in Massachusetts. When you designate a beneficiary on accounts such as life insurance policies, retirement accounts, or payable-on-death (POD) bank accounts, those assets transfer directly to the named individual upon death. This direct transfer allows for a quicker and simpler distribution of assets, avoiding the delays and costs associated with probate. Regularly updating beneficiary designations ensures that your wishes are honored and that the intended individuals receive their inheritance promptly and efficiently.
Trusts
Trusts are powerful tools for managing and distributing your assets while avoiding probate in Massachusetts. A trust is a legal arrangement where a trustee holds and manages assets on behalf of beneficiaries. There are various types of trusts, including revocable and irrevocable trusts, each serving different purposes. A revocable trust, or living trust, allows you to retain control over the assets during your lifetime and can be altered or revoked as needed. Upon your death, the assets in the trust transfer directly to your beneficiaries, bypassing the probate process entirely. Irrevocable trusts, once established, cannot be altered and offer benefits like asset protection and tax savings.
Using trusts in your estate planning ensures privacy, as trust assets do not become part of the public record. Additionally, trusts provide flexibility in managing how and when beneficiaries receive their inheritance, accommodating specific needs or circumstances. By setting up a trust, you can streamline the distribution of your estate, reduce legal hurdles, and provide a clear, efficient plan for your loved ones.
Payable on Death (POD) and Transfer on Death (TOD) Accounts
Payable on Death (POD) and Transfer on Death (TOD) accounts are effective tools to ensure your assets bypass probate in Massachusetts. With a POD account, you can designate a beneficiary to receive funds directly from your bank account upon your death. Similarly, a TOD account allows you to assign a beneficiary to inherit assets like securities and brokerage accounts. These designations enable a seamless transfer of assets, avoiding the delays and expenses associated with probate. By setting up POD and TOD accounts, you can ensure that your beneficiaries receive their inheritance quickly and efficiently, according to your wishes.
Small Estate Affidavit
A Small Estate Affidavit is a simplified legal procedure in Massachusetts that allows heirs to inherit assets from a deceased person’s estate without going through the full probate process. This option is available when the total value of the estate is below a certain threshold, currently set at $25,000, excluding the value of a car. By filing a Small Estate Affidavit, heirs can claim the deceased’s assets, such as bank accounts or personal property, by providing proof of entitlement. This process saves time and reduces legal costs, making it an efficient way to handle smaller estates while ensuring the rightful transfer of assets.
Contact Our Experienced Southeastern Massachusetts Estate Planning Attorneys
At Surprenant & Beneski, P.C., we guide you through the intricacies of estate planning, ensuring your assets are protected and efficiently transferred. Our experienced team is here to assist with all your estate planning needs. Contact us today to schedule a consultation and secure your family’s future.