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Las Vegas Estate Planning Law Blog

Is a joint tenancy with an heir a good idea to avoid probate?

In Nevada, some people want to avoid probate when they die so that their heirs do not have to go through a lengthy process in order to receive their assets from their estates. It is possible for people to avoid probate by titling their assets in joint tenancy with their intended heirs, but doing so is not always a good idea.

People are able to add heirs to their accounts and to their property as joint tenants of the accounts and the property. When the person dies, the accounts and property are then transferred automatically to the joint tenant. This may offer an inexpensive and fast way to transfer assets without going through probate.

How long will probate take?

After the death of a loved one, you may feel like matters go very quickly. Before you know it, relatives arrive, you discuss arrangements, and suddenly you are sitting at a funeral service thinking that you were talking with your departed parent or grandparent just days ago. At the end of the day, it may seem like everything is over. However, probate is just beginning.

You may be eager to bring closure to your loved one's finances, or perhaps you are expecting an inheritance from the estate. Either way, the length of probate is typically frustrating, even when the estate is simple. If your loved one made a will, you may find things go smoother. However, even with a will, there are elements that may drag out the process indefinitely.

Using a TOD deed to avoid probate

Nevada residents who intend to have their assets given to their offspring upon death and who have listed them as the beneficiaries on their investments have taken the right steps. They may have also complete a will that leaves all of their assets to their children. However, they may want to consider a transfer on death, or TOD, deed for the home and use a TOD designation on the vehicle's title to avoid the probate process.

Residents should keep in mind that a will is a mechanism that is used to control probate assets, which are assets that are in the name of the decedent only and have not been given any beneficiary designations. In the case of the parents who want to give their home or vehicle to their child, the home and vehicle are considered to be probate assets as they are only in the parents' name. Non-probate assets would include the investment assets that have beneficiary designations. Because the will only control probate assets, it does not control the investment accounts, but controls the home and vehicle.

The process of trust decanting

One of the estate planning tools that Nevada residents can use to protect certain assets for their heirs is an irrevocable trust. The nature of this particular type of trust prevents its provisions from being modified or cancelled, except in some cases with the expressed agreement of the beneficiaries and after taking expensive legal action. However, with legislation regarding decanting that is being passed in an increasing number of states, altering irrevocable trusts may soon become more common.

Trust decanting involves the trustee of an irrevocable trust transferring the assets of the original trust into another trust that has the desired modified terms. The trustee of the original trust has the authority to create the second trust due to the powers he or she was bestowed under the agreement for the original trust. State-level decanting statutes as well as common law could also grant this power.

Estate planning and types of trusts

Trusts are a commonly used tool in estate planning. There are many types of trusts Nevada residents may choose from when they are evaluating their estate planning options.

A qualified domestic trust may be used when the trustee is a United States citizen, and his or her spouse isn't. The trust ensures that the IRS will receive estate taxes upon the death of the U.S. citizen. This type of trust can be used to transfer an unlimited amount of marital property to a spouse and help the trustee avoid estate taxes prior to death because the trust can be drafted so that assets in the trust qualify for a federal estate tax marital deduction.

Does your trust-based estate plan need a pour-over will?

After looking over the various estate planning options available to you, you may have decided that a trust-based plan would best suit your needs. Many Nevada residents often come to this decision as trusts can offer a variety of protections for your property while also allowing surviving family members to avoid probate, if the proper steps are taken to do so. Plus, this tool could also help you better dictate how your assets should be handled after your death.

Because the amount of control offered by trusts may have acted as an appealing factor in your decision making, you may want to ensure that all of your assets go through distribution according to the terms of the trust. In order for that to occur, all of your property would need including in the trust. However, a chance does exist that certain assets could get overlooked or you may not update your trust before your death. Luckily, creating a pour-over will could ease your mind.

Why a married person may need powers of attorney

A power of attorney makes it possible for a person to have his or her wishes met while incapacitated. Nevada residents who create a power of attorney will draft such documents while they are still of sound mind. If a person is married, a spouse generally has the ability to make medical decisions for that individual. However, there may be situations in which the spouse is not able to do so.

This is when having a medical power of attorney can be important. Instead of the state or other entities deciding how to care for an individual, the power of attorney designates a trusted party to make those decisions. This designated party can be a family member, friend or anyone else an individual may trust to look out for his or her best interests while incapacitated.

Estate planning and divorce

When couples in Nevada decide to divorce, they are often concerned with immediate issues such as child custody, support payments and the division of assets. One area that may be overlooked is that of estate planning. It is essential that couples review their estate plans as part of the divorce process.

Spouses often make estate plans with the assumption that they will be married at the time of their death or incapacitation. While this is is a reasonable way to plan an estate, it's also important to recognize that circumstances can change. When a spouse realizes that their marriage is coming to an end, they should modify their plans so that their own families or children receive the lion's share of assets. In addition, a spouse may want to give another family member the authority to make end-of-life decisions on their behalf.

Why wills are important for everyone

Nevada residents of all levels of income may benefit from estate planning. While some people may think that they do not have enough assets or money to justify creating a will, they are mistaken. The courts will divide the assets of people who die without wills according to the state's laws about succession regardless of the wishes of the deceased.

The belief that some people have about not needing wills is based on the idea that wills are for them. Instead, these documents are for the loved ones of the deceased. Wills instruct these individuals how to handle and disperse their assets.

Allocating personal property

Nevada residents can use a variety of estate planning tools to dictate how specified assets should be handled in the event of their death. However, they should be aware that written provisions should be made for their other personal property as well.

What happens to any property that is not addressed in a will is left to the discretion of the heirs of an estate. If all of the heirs can agree on how the property should be distributed, any cash distributions the heirs are to receive may be offset by the value of the personal property he or she receives.