The probate process helps protect the legacy of deceased individuals and the interests of their surviving family members. The courts can validate the authenticity and legality of estate planning paperwork. They can facilitate the administration of an estate that does not have a will or other planning documents in place.
The probate courts, or Surrogate’s Courts in New York, can settle disputes among beneficiaries and help ensure that creditors and other interested parties receive what they should from an estate. Despite the usefulness of probate proceedings, many people establishing estate plans specifically prioritize probate avoidance. They fund trusts, change how they hold their assets and make other strategic moves to avoid probate entirely or minimize probate proceedings.
Why do people many focus on probate avoidance when developing their estate plans?
The costs involved
Neither time in court nor the consideration of the judge is free. The estate typically has to cover the costs of probate proceedings and possibly also the expense involved in legal representation for the personal representative of the estate. The amount spent on probate expenses can diminish what beneficiaries receive from the estate. Many people prioritize avoiding probate to optimize how much their loved ones ultimately inherit.
Privacy concerns
Another reason that testators may want to avoid probate court is for privacy purposes. The probate process requires financial disclosures regarding both resources and financial obligations. People who do not want information about their household finances passing through the courts may establish trusts and use other estate planning tools to keep their resources out of probate court to preserve their privacy.
Conflict prevention
Probate proceedings can sometimes inspire conflict among the beneficiaries of an estate. They may end up arguing over the validity of documents or the interpretation of specific terms included in a will. Limiting what passes through probate court can be a way to prevent family members from arguing amongst themselves and damaging their relationships with each other. In some cases, conflict among beneficiaries and surviving family members could lead to legal challenges in court that cost the estate money and trigger lasting damage to the relationships of beneficiaries.
Thinking about what motivates certain estate planning decisions can help people planning their escape determine what issues they need to address and what strategies they may want to employ. Making an effort to bypass probate can be a smart decision in many different scenarios.
