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Probate and trusts are part of handling what happens to your assets when you die.
Because a person's death is a time of great emotions and there are lots of other arrangements to take care of, managing and settling the estate shouldn't be an added burden.
Planning ahead for probate with a will or trust is an excellent way to ensure that your assets are managed and distributed the way you want them handled.
Probate
Probate is the process of settling the estate of a person who has passed away. This process involves, among other things, the validation of the will (if one is available), the distribution of the estate's assets and the settlement of the estate's debts.
There are two types of estates that go through probate:
Testate, where the person has left a valid will
Intestate, where the person has died without a will or no will could be found.
In cases where there is a will, property will be divided according to the contents of the will. If there is no will, property will be divided according to Arkansas statute.
The person who represents the estate during probate is commonly referred to as an executor or personal representative. This is often a friend or family member of the deceased person. Often also somebody who has never been through the probate process before. That means that the legal issues and responsibilities can quickly become overwhelming.
Trusts
There can be many advantages to setting up trusts as part of your estate plan. They don't go through probate, which can save a considerable amount of time and money.
They can also provide a way to transfer property to your beneficiaries without the burden of excessive estate taxes.
In addition, trusts can be a good option if the privacy of your estate and beneficiaries is a concern, since trusts are not a matter of public record.
A trust can contain any kind of asset that you wish to pass on to a beneficiary. Cash, retirement accounts, real property and other assets have all been put in trusts.
A trustee manages the assets according to your wishes and distributes them to the beneficiary at the appointed time specified in the trust documents. Distribution can be based on a certain event such as college graduation or marriage, reaching a certain age, your death or some other time that you determine.
Trusts can be complex financial vehicles and may not be the best solution for everyone. In order to determine if they are a good option for your needs, be sure that you speak to an experienced trusts attorney. At the Halbert Law Firm, we have experience with all types of trusts.
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