Under Missouri estate planning law, a court must authenticate the terms of a deceased person’s will before asset distribution to the beneficiaries can take place. This is known as probate, and it can be complex, time-consuming, and costly. Luckily, with the guidance of a skilled attorney, there are legal ways to skip the process. Below are several common methods.
How Can You Bypass Probate?
1. Establish a Living Trust
With a revocable living trust, you transfer the ownership of specific assets to the trust itself. While you enact the terms of this trust while you are still alive, you can change or revoke these rules anytime you wish. This allows for incredible flexibility. For example, if you plan to leave assets to a spouse but the two of you divorce, you can disinherit them easily. When you die, ownership passes directly to the named beneficiaries, without requiring a probate court to vet the transfer.
2. Set Up Joint Ownership
When you own a property jointly with another individual, full ownership automatically transfers to the other party when you pass away. Estate planning attorneys often recommend this method to couples who live and own property together. This allows your spouse to immediately gain control of the home and other properties without dealing with probate.
3. Designate Beneficiaries on Retirement Accounts
Some retirement accounts, such as a 401(k) and individual retirement account (IRA), are not subject to probate laws. When establishing these funds, you designate a beneficiary and the money immediately transfers to this person after your death. However, to successfully utilize this option, you should update the beneficiary designations regularly. For example, if you leave an IRA to a spouse who passes away before you, the money is subject to probate.
4. Add Payable-on-Death
Missouri law allows you to add a payable-on-death (POD) designation to many financial accounts, including checking and savings accounts. A POD designation enables you to choose specific individuals to take control of these funds when you pass away. These beneficiaries will automatically have access to the accounts upon your death.
For more advice on how to avoid probate as you put together an estate plan, contact Hackworth, Ferguson & Thompson in Piedmont. For more than 45 years, the seasoned attorneys at this firm have been providing clients throughout southeast Missouri with first-rate estate planning assistance, as well as help with family law matters, personal injury cases, and bankruptcy. Visit the website for more information about their services. Call (573) 223-4247 to schedule a consultation with an attorney.
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