Friday, March 1, 2013

Simple Facts about Probate

Probate is the procedure used to reconcile estates of people who pass away and transfer their property to beneficiaries. As long as people prepare a Will the process can usually be completed in a few months. Without one, estate settlement takes longer and usually costs additional money.

All decedent estates are subject to probate unless measures are put into place prior to death. For most, this involves arranging a trust. However, other methods can be used such as securing joint titles for realty and automobiles, or assigning beneficiaries to receive proceeds in banking and investment accounts.

A key element of estate planning is preparing a will and testament. Wills are needed for both probated estates and trusts. They designate the person responsible for settling the estate; the beneficiaries entitled to possessions; and establish legal guardians for children.

Probate estates are classified as testate (with a Will) and intestate (without a Will). Intestate estates must be settled in accordance with state probate rules, while testate estates are settled according to directives written by decedents.

One affordable and effective way to bypass probate is to transfer property into trusts. Generally speaking, trusts are relatively easy to arrange. However, it's recommended to hire a lawyer to help with documents and ensure everything is taken care of.

Living trusts are by far one of the most popular. This type is easy to arrange and makes estate settlement much easier than probate. It's an affordable option for nearly everyone and offers a bounty of benefits.

Arranging trusts isn't the only method to avoid probate. Small estates might qualify for exemption of probate if they meet state guidelines and a Will is presented to the court. The estate has to pass through a confirmation period before assets can be transferred to heirs; however it is much faster than probate.

Estate planning for probate estate and trusts primarily consists of the same documents. People need to prepare a Will and power of attorney documents. The Will states who receives assets held in the estate or trusts.

Power of attorney forms are only in effect while you're still living. They are needed to make certain your personal or business responsibilities can be maintained even if you aren't able to do so.

For instance, a general power of attorney can be arranged to let a relative handle your personal finances if you're involved in an accident. A medical power of attorney lets a person become involved in medical decisions if you are unconscious or incapable of making sound decisions.

Power of attorney is especially important for business owners. It can let colleagues assume ownership duties in the event of emergency. This type of POA is commonly used with business succession planning to ensure business operations continue uninterrupted.

Generally speaking, a power of attorney should be created for all tasks that involve financial or business transactions. These could involve managing banking transactions; paying mortgage payments; overseeing financial investments; or entering into business contracts.

Estate planning is important for everyone, but particularly California residents. The Golden State is known for having the most complex probate laws in the country. Regardless if you want to prepare a Will or setup a trust it is advisable to get help from California probate attorneys, such as Craton and Switzer, to create an estate plan that eases settlement proceedings.