What Assets Do Not Pass through Probate in Pennsylvania?
When you pass away, your wishes will be upheld in accordance with your estate plans, which generally include a will, a trust or trusts, and other financial tools that are beneficiary-based. If, however, you failed to engage in estate planning, your legacy – or the assets you amassed over the course of your lifetime – will be distributed according to Pennsylvania’s laws of intestacy, which could be in sharp contrast to your wishes. A better understanding of probate laws in Pennsylvania can provide you with the boost you need to help ensure that your wishes are upheld when the time comes. Working closely with an experienced Harrisburg, Pennsylvania, estate planning attorney is one of the most important steps you can take on your journey forward.
Your Will
Having a will in place is an important element of estate planning in Pennsylvania and throughout the nation, but everything that passes through your will must go through probate. Probate refers to the will-validation process and to the administration of these legal documents.
In your will, you will leave any assets that are not addressed in a trust or that aren’t beneficiary-based to specific heirs, and this transfer will need to go through the probate process, which may be time-consuming and legally exacting. Investment products that bypass the probate process may be preferred.
Assets that Don’t Go through the Probate Process
There is a wide range of assets that bypass the complexities of the probate process in Pennsylvania, though they may still be subject to Pennsylvania’s Inheritance Tax.
Jointly Held Assets
When an asset is held jointly with rights of survivorship, probate doesn’t apply when one of the co-owners passes. Instead, the surviving co-owner or co-owners automatically inherit the percentage that belonged to the decedent – or to the person who died.
Common examples include:
- Joint brokerage accounts
- Joint bank accounts
- Vehicles that are held in joint ownership
- Real estate that is held in joint tenancy
Assets with Assigned or Named Beneficiaries
Those assets that allow you to assign or name beneficiaries go directly to the beneficiaries that you name upon your passing – bypassing probate along the way. Common examples of assets with assigned beneficiaries include:
- Life insurance policies
- Retirement accounts
- Some stocks, bonds, and other financial tools
Further, assets that are held in trust are owned by the trust and are therefore exempt from probate. The same is true of accounts that are payable on death or that are designated as transfer on death.
An Experienced Harrisburg Estate Planning Attorney Can Help
The accomplished Harrisburg, Pennsylvania, estate planning attorneys at Cunningham, Chernicoff & Warshawsky, P.C., understand how important it is to minimize the probate process, and we’re committed to helping you make that happen – in support of your wishes and your loved one’s best interests. For more information about what we can do to help you, please contact us online or call us at 717-260-3527 today.