How an individual’s assets are transferred to their heirs after they die is a pivotal issue in estate planning and probate administration that most people don’t quite understand. One of the biggest misconceptions regarding asset transfer is that, most people assume if your Last Will and Testament says that your assets are to be transferred in a particular way, then all your asset will actually be transferred in that way. However, this is not always the case.
Good estate planning requires you to understand that the way an asset will be transferred when you die will first and foremost be determined by the way in which it is titled at the time of your death. Thus, for your estate plan to work the way you want, it is extremely important that title to your asset be aligned with your ultimate estate planning objectives.
The first step in the probate process is locating or identifying any assets associated with the decedent, and the second step is to determine how those assets are titled in order to ascertain how they are to be distributed. Assets will fall into district categories depending on how they are titled as follows:
Here is where those detective skills really come in handy. Most people are surprised to discover that there is no centralized depository for Wills to be safeguarded before someone’s death, at least in the state of Florida. What this means is that most original Wills are held by the decedent in their home, or in a safe deposit box, but if the exact location is unknown to the surviving beneficiaries, then the Will may be lost forever. If there are no estate planning documents to be found, you’ll need to look through personal papers, address books, checking account statements, and email contacts for evidence of a personal attorney, financial advisor, accountant, or insurance representative. If the Will was executed with an attorney, the next place to check is with the attorney’s office to obtain the original Will or a copy of the executed document.
Any mail that the deceased is still receiving may also provide a few clues. You should also check with any banks where the deceased had accounts to see if he or she also had a safe deposit box where documents, information, or assets may have been stored.
The Florida Probate Firm routinely works with out of state and out of county beneficiaries and executors upon the passing of a family member in Florida. We assist beneficiaries in identifying assets, even when the parties have very little information as to the location or identify of the property. If the family members do not have time to travel to Florida to handle the investigation and collection process, our firm can be delegated with such tasks. An attorney with our firm can even serve as the court appointed personal representative if necessary.
How an asset is titled at death will ultimately determine how the asset will be transferred:
Typical examples of non-probate assets include IRAs, 401Ks, and similar retirement plans, as well as, life insurance policies and annuities which generally pass directly to the decedent’s heirs via beneficiary destinations. Similarly, assets such as financial accounts, brokerage accounts, checking accounts, and securities may be transferred directly the decedent’s heirs via POD or TOD designations, but these designations must be completed before the passing of the owner. The decedent’s interest in any property owned jointly with another person, also bypasses probate and passes directly to the surviving joint owner(s).
All other assets held in the decedent’s sole name will be considered part of his or her probate estate and will be transferred in accordance with the provisions of the decedent’s Last Will and Testament towards the end of the probate process.
Finally, if the decedent has a trust in place when he or she dies, any assets owned by the trust will bypass probate and be distributed according to the terms of that trust.
One of the first steps the personal representative will undertake after their appointment in settling an estate is inventorying all of the deceased’s assets and debts. If a clear estate plan does not exist with those lists already compiled, you may need a few detective skills to help you search for the following documents that you will need in order to prepare an inventory and final accounting for the estate: