Estate Planning

What is probate?

When a person passes away, his or her estate often goes through a court-managed process called probate or estate administration where the assets of the deceased are managed and distributed. If the person owned his or her assets through a well drafted and properly funded living trust, it is likely that no court-managed administration is necessary, though the successor trustee needs to administer the distribution of the deceased's assets. The length of time needed to complete the probate of an estate or administration of a living trust depends on the size and complexity of the estate and the local rules and schedule of the probate court.

What steps are involved in the probate process?

Every probate estate is unique, but most involve the following steps:

• Filing of a petition with the proper probate court.
• Notice to heirs under the Will or to statutory heirs (if no Will exists).
• Petition to appoint a Personal Representative.
• Inventory and appraisal of estate assets by Personal Representative
• Payment of estate debt to rightful creditors.
• Sale of estate assets.
• Payment of estate taxes, if applicable.
• Final distribution of assets to heirs.
  

Do all assets go through probate?

Certain types of assets are what are called “non-probate assets” and do not go through probate. These include:

• Property in which you own title as “joint tenants with right of survivorship”. Such property passes to the co-owners by operation of law and does not go through probate.
• Retirement accounts such as IRA and 401(k) accounts where there are designated beneficiaries.
• Life insurance policies.
• Bank accounts with “pay on death” (POD) designations.
• Property owned by a revocable living trust. Legal title to such property passes to successor trustees without having to go through probate.
  

How much does probate cost? How long does it take?

The cost and duration of probate can vary substantially depending on a number of factors such as the value and complexity of the estate, the existence of a Will and the location of real property owned by the estate. Will contests or disputes with alleged creditors over the debts of the estate can also add significant cost and delay. Common expenses of an estate include Personal Representative fees, attorneys fees, accounting fees, court fees, appraisal costs, and surety bonds. These typically add up to 2% to 7% of the total estate value. Most estates are settled though probate in about 9 to 18 months, assuming there is no litigation involved.

Can probate be avoided?

Yes, probate can be avoided by utilizing specific estate planning techniques. There are several techniques which can be implemented either by themselves or in conjunction with other techniques.

What is a Living Trust?

A Living Trust is a Legal Document prepared to handle the affairs of your estate in case of your death or incapacity to act in your own best interest. A Living Trust will protect your estate when you are no longer capable and it will make life easier for the loved ones you leave behind. A Living Trust will help your estate avoid the length and costly expense of probate.

A properly funded Living Trust offers you continuity of control of your affairs. When we prepare your Trust, it will include provisions for the handling of your affairs after your death. The Trust can also make provisions for minor children, children of a former marriage or grandchildren, even mentally or physically handicapped heirs. Also for any persons you may want to exclude from your estate. For peace of mind, a Living Trust may be all you need.

When you transfer assets to your Living Trust, you keep full control. As trustee of your trust, you can do anything you could do before. You even file the same tax returns. Nothing changes but the names on the title to the assets.

The Moore Law Firm assists clients with Construction Matters in St. Charles County and St. Louis County, including O’Fallon, Wentzville, St. Peters, Troy, Warrenton, St. Charles, Lake St. Louis, Chesterfield, Ballwin, Richmond Heights, Maryland Heights, Brentwood, Clayton, Ladue and Sunset Hills. We also serve clients in Lincoln County, Franklin County, Jefferson County and Warren County.