Understanding Ownership of Property
How Property is Titled Dictates Who Inherits It After You Die
Each and every time I sit down with a new estate planning client, I ask what should be a simple question, but in reality it is usually one of the most difficult questions that the client must answer. Learn what this question is and why it is the one real key to good estate planning.
Overview of Types of Property Ownership
There are only three ways to own property - in your individual name, in joint names with others, or by contract rights. Here you'll find a summary of what each type of ownership means for you and your family.
Understanding Individual Ownership of Property
There are three basic ways that you can own property: in your individual name, in joint names with others, and through contract rights. Whether or not a particular asset that you own at the time of your death will need to be probated will depend entirely upon how it's titled.
Understanding Joint Ownership of Property
There are three basic ways that you can own property: in your individual name, in joint names with others, and through contract rights. Joint ownership comes in three forms: with rights of survivorship, as community property, and as tenants in common.
What is Community Property?
Community property is a type of joint ownership of property between married couples that is recognized in the following states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin.
Understanding Title by Contract
There are three basic ways that you can own property: in your individual name, in joint names with others, and through contract rights. Title by Contract can take on various forms: payable on death ("POD") or transfer on death ("TOD") designations; in trust for ("ITF") accounts; Totten trusts; life insurance policies; retirement accounts and annuities; and Revocable Living Trusts.
Using Joint Accounts and Payable on Death Accounts to Avoid Probate
There are two common and simple ways to avoid probate: using joint accounts and using payable on death accounts, also called transfer on death accounts.
How Does a Revocable Living Trust Avoid Probate?
Another common way to avoid probate is to establish and fund a Revocable Living Trust.
What Are Non Probate Assets and Are They Included in Your Estate?
Non probate assets are simply assets that won't need to be probated after you die. But will they be included in the value of your estate for estate tax purposes? Find out.
What Are Probate Assets?
When a deceased person's estate owns certain types of assets, called probate assets, then the estate will be subject to a probate court proceeding in order to get the probate assets out of the deceased person's name and into the name of the rightful heirs. Here you will find a description of the three different types of probate assets.
What Happens to a Payable on Death Account When the Owner Dies?
If your loved one has died and you're the beneficiary of a payable on death or similar type of account, then you'll need to understand the tax and other consequences of inheriting the account.
What Happens to a Joint Account When an Owner Dies?
If your loved one has died and you're the surviving joint owner of an account held with rights of survivorship or as tenants by the entirety, then you'll need to understand the tax and other consequences of inheriting the account.
What Happens to Life Insurance When the Insured Dies?
If your loved one has died and you're the beneficiary of a life insurance policy, then you'll need to understand the tax and other consequences of inheriting the insurance.
What Happens to a Retirement Account When the Owner Dies?
If your loved one has died and you're the beneficiary of a retirement account such as an IRA or 401(k), then you'll need to understand the tax consequences of inheriting the retirement account. The results will be very different if you're a surviving spouse or not.
Who Inherits Property Owned as Tenants in Common?
If your loved one has died and you and your loved one owned property as tenants in common, then you'll need to understand who will inherit the deceased owner's portion of the property.
How Are a Deceased Person's Debts Handled Before and During Probate?
If your loved one has died and a probate estate will be required, then you'll need to understand how your loved one's final bills and other debts will be handled before and during the probate process. Learn who will be responsible for paying the bills and when.
Who Pays Off a Deceased Person's Debts?
If your loved one has died and the medical and credit card bills have started piling up, then you'll need to understand who will be responsible for paying off all of these debts and in what amounts. Learn who has to pay and how much.
Does Life Insurance Have to Be Used to Pay a Deceased Person's Bills?
If your loved one has recently died and you're the beneficiary of a life insurance policy, learn whether or not you'll have to use the life insurance proceeds to pay your loved one's final bills.
Does an IRA or 401k Have to Be Used to Pay a Deceased Person's Bills?
If your loved one has recently died and he or she owned any retirements accounts, then you'll need to understand if the accounts must be used to pay off the final bills of the decedent. The quick and easy answer depends on whether the retirement account had a designated beneficiary or not at the time of the decedent's death.
Do the Other Owners Have to Pay a Deceased Tenant in Common's Final Bills?
When one of the owners of property titled as tenants in common dies, the surviving owners won't be personally liable to pay off the deceased owner's final bills. But the surviving owners may be forced to sell certain property that's owned as tenants in common. Find out why.
Avoiding Probate By Adding Your Children to Your Deed - Good or Bad Idea?
Many people believe that adding their children's names to the deed for their home is a good way to avoid probate of the home after death. But not so fast - adding your children to your deed should only be considered after understanding all of the problems that can occur after doing so.
A Quick Guide to Florida Homestead Laws
Florida has some quirky laws when it comes to your primary residence, which is referred to as your "homestead." Read on for a quick overview of these laws and how they can affect you and your family.