Wealth preservation and transfers are important considerations during estate planning. Many people aim to keep resources out of probate court whenever possible. Doing so can help reduce estate tax obligations and limit secondary claims against those assets.
Real estate holdings often require careful consideration, as their transfer necessitates specialized paperwork. Instead of including a home or other real estate in a will with other assets, testators may seek solutions that keep their holdings out of probate court.
Some people use trusts to protect their real estate holdings from probate proceedings. There is also a straightforward legal document that can facilitate a prompt posthumous ownership transfer.
Transfer-on-death deeds might be helpful
Some real estate owners take on co-owners while they are still alive. Holding title as joint tenants with rights of survivorship (JTROS) may allow an adult child, sibling or romantic partner to assume full ownership over the property.
In scenarios where people do not want to share title while they are alive or do not live with the beneficiary inheriting the home, a transfer-on-death (TOD) deed may be a better solution. They can select a beneficiary and execute documents in advance that allow them to assume ownership of the property after their passing.
The beneficiary can then present the deed to local authorities to update ownership records when the current owner passes away. Instead of the home meeting to pass through probate court, which could leave it vacant for months, it can transfer to a new owner quickly without having to pass through the probate court.
Reviewing personal holdings can help people establish estate plans that preserve their wealth and protect their beneficiaries. Deeds can help people appropriately address their real estate holdings in an estate plan.
