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Legal Notes: Should You Avoid Probate?

Seunghee ChaAttorney Seunghee ChaMany people want to avoid probate without realizing what it is or that it has benefits. Thorough estate planning involves a careful evaluation of whether avoiding or minimizing probate is desirable.

Probate refers to a court process for overseeing (i) the appointment of the personal representative (aka “executor”), (ii) the determination of the validity of a decedent’s will, (iii) the identification of heirs of the estate, (iv) the marshalling of assets held in the name of the decedent, (v) notice to creditors of the estate, and (vi) other property issues arising at death.

A few advantages of probate:

Legal notice. The publication required in probate gives creditors one year (in Massachusetts) from the date of death to make claims against the estate. For estates facing creditor problems, the deadline offers finality and protection.

Court oversight. Judicial involvement of the administration protects interested parties from possible mishandling of the estate by the personal representative. Many people can trust a family member acting as personal representative to administer the estate properly. In some situations, however, inventory and accounting requirements provide much-needed transparency.

The major disadvantages generally associated with probate are public disclosure of assets in the decedent’s name and the expense of the probate process. However, such disadvantages are mitigated by various factors. Consider:

Privacy. While assets in a decedent’s name often must be disclosed, life insurance proceeds, joint assets, and IRA and 401(k) benefits, which typically constitute the bulk of a decedent’s assets, are normally not disclosed because joint property and property passing under contract by beneficiary designation are not subject to probate.

Cost. Under the Massachusetts Uniform Probate Code, in effect since March 2012, the probate process is streamlined to allow less formal, more user-friendly administration options. Consequently, the cost of probating an estate in Massachusetts often is much less than in many other states and should not be the reason for deciding whether or not to avoid probate.

The major disadvantages generally associated with probate are public disclosure of assets in the decedent’s name and the expense of the probate process. However, such disadvantages are mitigated by various factors.

Strategies for avoiding probate include adding a joint owner to your property and establishing a trust and titling ownership of assets to be held in the trust. These actions incur cost and can result in loss of control, disposition of assets to unintended beneficiaries, and adverse tax consequences.

Probate is often misunderstood and unnecessarily feared. A good estate plan involves education to help individuals and families make informed decisions to meet their personal needs—which may not involve avoiding probate.

The views expressed in this column represent general information. To address your particular and specific needs consult your own attorney. If you need help with referral to an attorney, contact the Franklin County Bar Association at (413) 773-9839 or the Worcester County Bar Association at (978) 752-1311. Elder law resources may be found through the National Academy of Elder Law Attorneys, Massachusetts Chapter, at massnaela.com or 617-566-5640.

Community Legal Aid (CLA) provides legal services free to people age 60 and older for civil legal matters with an emphasis on access to health care coverage (MassHealth and Medicare) and public benefits as well as tenants’ rights. A request for legal assistance can be made by phone at 413-774-3747 or toll-free 1-855-252-5342 during their intake hours (Monday, Tuesday, Thursday, and Friday from 9:30 a.m. to 12:15 p.m. and Wednesday from 1:30 p.m. to 4:15 p.m.) or any time online by visiting www.communitylegal.org.