If you’re preparing to put your estate plan in place, a key goal may be to make things as uncomplicated for your loved ones as possible. Smart estate planning can help prevent your estate from having to go through a long, expensive and time-consuming probate.
There are a number of steps you can take to let assets bypass probate, as we’ve discussed on this blog before. Such steps can allow your assets to get to your intended beneficiaries sooner and more privately than they otherwise would.
Understanding ancillary probate
Unfortunately, some people who work to avoid having their assets go through probate forget about assets they have in other states. If you own assets in another state, your assets may have to go through something called “ancillary probate” (as opposed to “domiciliary probate,” which is probate in your state of residence).
Maybe you have a small condo in New Mexico that you list on a vacation rental site. You might own a boat docked in Florida that you can’t bring yourself to sell – even if you only use it a few weeks a year. Maybe you still have a bank account in a state where you used to live.
If you own such assets when you die and you don’t address them in your estate planning, they may need to go through ancillary probate, depending on their value. Fortunately, if you have a well-drafted estate plan that’s accepted by a Texas probate court, it will probably be accepted by a court in the state where the property is located without much delay or complication.
Avoiding ancillary probate
You can take steps to avoid ancillary probate just as you can take steps to avoid domiciliary probate. One step is to sell assets in another state if you don’t need or use them. You also may be able to gift an asset or move it from its current location. Another option is to add another owner to the asset with right of survivorship or designate an asset to transfer on death to an heir or other beneficiary.
If you choose to keep out-of-state assets, it’s important to make your designated personal representative (executor) aware of them, since it may mean they’ll have to travel out of state to deal with them. It’s also important to inform your estate planning professional so you can determine what your best options are and help make things as easy as possible for your loved ones.
