July 2, 2024
Why A Will Doesn't Avoid Probate (Episode # 304)
In the realm of estate planning, a Last Will and Testament, commonly known as a Will, is often seen as the cornerstone document. However, there's a common misconception that having a Will in place means your assets won't have to go through probate.
In the realm of estate planning, a Last Will and Testament, commonly known as a Will, is often seen as the cornerstone document. However, there's a common misconception that having a Will in place means your assets won't have to go through probate.
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Well, good afternoon, Michigan.
It is Tuesday, July second, twenty
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twenty four, and of course this
is Tuesday with Tom, Michigan's only weekly
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Internet show where we do answer your
questions about estate planning and a state settlement
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00:00:46.799 --> 00:00:51.600
in Michigan, and we don't send
you a bill. As always, I'm
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your host, Tom Doyle, a
state planning attorney, lifelong Michigan resident,
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and an ambassador for all things good
in this eight state of Michigan. Welcome,
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welcome, welcome to today's program.
Well, if you're a regular listener
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00:01:07.799 --> 00:01:12.400
to the program, you'll note that
did not have an episode last month.
9
00:01:12.560 --> 00:01:19.760
Much of the month was spent quite
frankly on vacation and traveling. But I'm
10
00:01:19.799 --> 00:01:25.120
happy to be back in the studio
today. The last episode that we did
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00:01:25.200 --> 00:01:30.200
though, was why your special needs
Child should have an am i able Account.
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00:01:32.000 --> 00:01:34.239
So if you have a special needs
child, I encourage you to listen
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00:01:34.319 --> 00:01:40.439
to that episode, which was number
three oh three, where I talk about
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00:01:40.480 --> 00:01:48.319
what an amiable account is and why
that can be an important financial tool for
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your special needs child. Well,
today, a topic that occurs so frequently
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during countations with clients, and I've
talked about in previous episodes of the program,
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but I haven't talked about it for
a while, so I thought i'd
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refresh the conversation. And that is
why a will doesn't avoid probate. Why
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a will does not avoid probate.
But please remember what I'm about to discuss
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during the program is, as always
for educational purposes. It is not intended
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to be legal advice. You need
to work with your attorney to determine what
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is appropriate for you and your estate
plan. Why a will doesn't avoid probate
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it's so often it's one of the
most common misconceptions that people have about wills,
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thinking I have a will, there
if I broke probate. I've mentioned
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it before. So often a man
and I are meeting with clients, they
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tell us that they want to have
a will, and when we ask them
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why do they have a will,
inevitably they are going to tell us they
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have to have a will to avoid
approbate. So why doesn't a will probate?
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Well, obviously, wills are important
documents as part of an overall estate
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plan. In a will, you
can indicate your distribution of your assets,
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guardianship for miners, conservatorship for miners, etc. But having a will itself
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does not mean that your estate,
your assets, what you own will not
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have to go through probate at the
time that you die. So let's briefly
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talk about what probate is. Probate
is the legal process that would take place
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after you die, and it's your
primary purpose is to make sure that your
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appropriate debts are paid and your assets
are distributed according to your wishes as outlined
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in your will. So in your
will, you will indicate where you want
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your estate to go. You will
indicate who it is that you want to
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be in charge of managing the estate, what we call a personal representative.
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And if you have minor children,
in your will, you will appoint the
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guardians that will raise your minor children
until they get to be eighteen, and
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conservators that will manage any estate for
your minor children also until they get to
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be eighteen. Now, part of
this probate process also involves various steps,
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but one of those is to validate
the will. So when a probate estate
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is open and the will is submitted
to probate, one thing that has to
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happen is they has to have a
determination made that it it is actually your
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last will. Before it is going
to be admitted into probate. There's then
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going to be an inventory that's going
to be prepared that identifies all the different
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assets that you own, a process
for paying debts, notifying creditors, and
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then ultimately distributing the remaining assets to
beneficiaries. That essentially is what probate is.
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Now, if you don't have a
will, that you might have what
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we would call an interstate success a
state, and in that case, you
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haven't determined where your assets are going
to go. But the state of Michigan
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has determined where your assets are going
to go. Now, the important consideration
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is this, so what assets are
subject to probate, because not all assets
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are going to go through probate.
Assets that are solely owned by you,
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that don't have either a designated beneficiary
or a POD or a TOD, or
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not jointly owned with somebody else,
those are the assets that are subject to
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going through probate. That would include
any real estate that's just in your name,
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bank accounts that are in your name, investments that are in your name.
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Amanda's working on in a state right
now where an individual had an IRA,
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but the estate was made as the
beneficiary of the IRA, and so
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in that case, that IRA is
now going to have to go through probate.
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Other assets such as vehicles, personal
properties, etc. So anything that
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you own solely in your name that
does not have a beneficiary or TODPOD and
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is not jointly owned by with somebody
else are the assets that typically will go
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through probe. So those are the
things that are going to go through probate.
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Now. A common misconception, though, is that having a will somehow
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means that your assets will automatically avoid
probate. Not true though, because the
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will is essentially the roadmap for the
probate court that says, whatever assets I
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have that do go through probate.
So again, if you have a house
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that's just in your name, or
bank accounts that are just in your name,
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or vehicles that are just in your
name, or investments that are just
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in your name, the will essentially
is a roadmap for the probate court and
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your personal representative to determine where those
assets are going to go through the probate
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process. Through the probate process,
what does that mean. That means that
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even if you have a will,
Even if you have a will, you
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might have assets that are going to
go through probate. Essentially, if you
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don't own anything at the time of
your death, if you don't own any
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real estate in your name, or
have any assets that don't have TOD or
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pod BET designations on them, or
you don't have jointline assets. If you
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essentially don't own anything at the time
of death that's in just your name,
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those assets won't go through probate.
But it's not your will that is causing
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that to happen. It's the fact
that you simply don't have any assets that
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have to go through probate. The
will, though having a will, I
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tell clients all the time, here's
consideration a will. Couple considerations important to
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remember. One, a will is
a meaningless document will two things happen,
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one you die, and two a
probate estate is opened and your will is
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admitted to probate. Until then,
it's a meaningless piece of paper. So
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having a will, simply having a
will that says here's where I want my
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estate to go, doesn't control whether
or not your state's going through probate.
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What controls whether or not your state
goes through probate is do you have any
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assets that have to be excuse me, that have to be probated. If
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you do, then your state those
assets are going through probate. If you
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don't, then those assets are not
going through probate. So the will doesn't
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control that. The will simply controls
what happens when assets do go through probate.
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Now, many clients are going to
look at their state and say,
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hey, I for whatever reason,
could be cost, could be other issues
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that I've talked about in previous episodes
of this program. Maybe protecting my privacy,
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maybe making sure that the children get
along after I death, So we
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want an expedited settlement of the estate. A number of different reasons that clients
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are going to have to avoid probate
or minimize if you will, what would
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have to go through probate. You
start looking at those strategies, those strategies
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which again are not having a will. It's going to be things like using
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nonprobate transfer mechanisms such as using beneficiary
designations. If I have a bank account,
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and on my bank account, I
have a beneficiary designated who's going to
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receive that account when I die,
or it might be a payable on death
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or transfer on death, that account
is not going through probate if that person
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is still alive at the time of
my death. I might have jointly owned
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assets. Perhaps you're married and you
and your spouse jointly own your home.
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When one of you dies, that
home is not going through probate because it
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is jointly owned with your spouse.
So you look at nonprobate transfer mechanism things
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that you can do with your assets. If you're going to have real estate,
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maybe we're going to use a Lady
birdt a tool that can be used
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to have real estate avoid having to
go through probate. Another very common planning
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option that will be appropriate for some
clients would be having a revocable living trust.
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You create a revocable living trust,
you transfer assets into the trust during
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your lifetime. Those assets that are
now in your trust are not subject to
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probate because they are no longer owned
by you individually. They are owned by
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your trust. So if in looking
at your estate and evaluating what you want
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to accomplish with your estate plan,
and if you determine as part of that
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that avoiding probate is an important consideration
for you, simply remember a will is
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not going to avoid probate. You
need to use other tools that are going
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to be available. So while the
will can be a critical document depending upon
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the nature of your state, understand
that the probate process happens in respect based
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upon the assets that you have,
and not whether you do or do not
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have a will. Of course,
Amanda and I would be honored to have
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the opportunity to help you protect your
loved ones by putting together your state plan,
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and if that includes avoiding probate,
what strategies can be utilized to accomplish
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that goal, or perhaps amending a
plan that you already have, even if
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it's one that we didn't prepare,
or assisting you in settling a loved one's
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estate. We have in person consultation
at our New Grand Rapids headquarters. We
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have in person consultation at our East
Lansing location. We have virtual consultations via
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Zoom or telephone, So wherever you
happen to be in the state of Michigan,
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we can likely assist you with your
estate planning needs. Remember to we
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have our legal store. Through the
legal Store, you can order individual legal
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documents that you might need, perhaps
you're looking to replace, maybe just your
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healthcare power of attorney well, you
don't need to have an entire estate plan
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redone, just for a new healthcare
power of attorney. If you're our legal
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store, you would be able to
order that document online and have it delivered
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to you through email. More information
on all that, how to schedule a
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consultation with us, and what information
on our legal store and ordering documents,
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they are all available at our website. That's Doyle LAWPC dot com. Again,
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that's Doyle Law PC dot com.
Well, I think that is going
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to be it for today's show.
As always, Oh, if you have
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a comment about our program, if
you have a topic that you'd like to
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have me discuss, or perhaps questions
that you would like to have answered.
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Much of what I talk about during
the program is in response to questions that
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we are asked, either in person
or via email or via the Tuesday with
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that you have an awesome day and
an awesome week in Michigan. Stay safe.
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Tuesday with Tom has been brought to
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or with settling a loved one's estate, please call us today at five one
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seven three two three seven three sixty
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three seven three sixty six
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Well, good afternoon, Michigan.
It is Tuesday, July second, twenty
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00:00:35.679 --> 00:00:41.079
twenty four, and of course this
is Tuesday with Tom, Michigan's only weekly
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00:00:41.159 --> 00:00:46.719
Internet show where we do answer your
questions about estate planning and a state settlement
4
00:00:46.799 --> 00:00:51.600
in Michigan, and we don't send
you a bill. As always, I'm
5
00:00:51.600 --> 00:00:56.079
your host, Tom Doyle, a
state planning attorney, lifelong Michigan resident,
6
00:00:56.159 --> 00:01:03.039
and an ambassador for all things good
in this eight state of Michigan. Welcome,
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00:01:03.520 --> 00:01:07.760
welcome, welcome to today's program.
Well, if you're a regular listener
8
00:01:07.799 --> 00:01:12.400
to the program, you'll note that
did not have an episode last month.
9
00:01:12.560 --> 00:01:19.760
Much of the month was spent quite
frankly on vacation and traveling. But I'm
10
00:01:19.799 --> 00:01:25.120
happy to be back in the studio
today. The last episode that we did
11
00:01:25.200 --> 00:01:30.200
though, was why your special needs
Child should have an am i able Account.
12
00:01:32.000 --> 00:01:34.239
So if you have a special needs
child, I encourage you to listen
13
00:01:34.319 --> 00:01:40.439
to that episode, which was number
three oh three, where I talk about
14
00:01:40.480 --> 00:01:48.319
what an amiable account is and why
that can be an important financial tool for
15
00:01:49.000 --> 00:01:57.799
your special needs child. Well,
today, a topic that occurs so frequently
16
00:01:59.439 --> 00:02:04.040
during countations with clients, and I've
talked about in previous episodes of the program,
17
00:02:04.079 --> 00:02:07.040
but I haven't talked about it for
a while, so I thought i'd
18
00:02:07.040 --> 00:02:15.280
refresh the conversation. And that is
why a will doesn't avoid probate. Why
19
00:02:15.319 --> 00:02:20.120
a will does not avoid probate.
But please remember what I'm about to discuss
20
00:02:20.199 --> 00:02:25.120
during the program is, as always
for educational purposes. It is not intended
21
00:02:25.199 --> 00:02:30.159
to be legal advice. You need
to work with your attorney to determine what
22
00:02:30.319 --> 00:02:47.560
is appropriate for you and your estate
plan. Why a will doesn't avoid probate
23
00:02:47.680 --> 00:02:53.919
it's so often it's one of the
most common misconceptions that people have about wills,
24
00:02:53.960 --> 00:02:59.360
thinking I have a will, there
if I broke probate. I've mentioned
25
00:02:59.360 --> 00:03:04.240
it before. So often a man
and I are meeting with clients, they
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00:03:04.280 --> 00:03:06.680
tell us that they want to have
a will, and when we ask them
27
00:03:06.680 --> 00:03:08.919
why do they have a will,
inevitably they are going to tell us they
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00:03:08.960 --> 00:03:15.080
have to have a will to avoid
approbate. So why doesn't a will probate?
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Well, obviously, wills are important
documents as part of an overall estate
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plan. In a will, you
can indicate your distribution of your assets,
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guardianship for miners, conservatorship for miners, etc. But having a will itself
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does not mean that your estate,
your assets, what you own will not
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have to go through probate at the
time that you die. So let's briefly
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talk about what probate is. Probate
is the legal process that would take place
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after you die, and it's your
primary purpose is to make sure that your
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appropriate debts are paid and your assets
are distributed according to your wishes as outlined
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in your will. So in your
will, you will indicate where you want
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your estate to go. You will
indicate who it is that you want to
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be in charge of managing the estate, what we call a personal representative.
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And if you have minor children,
in your will, you will appoint the
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guardians that will raise your minor children
until they get to be eighteen, and
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conservators that will manage any estate for
your minor children also until they get to
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be eighteen. Now, part of
this probate process also involves various steps,
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but one of those is to validate
the will. So when a probate estate
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is open and the will is submitted
to probate, one thing that has to
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happen is they has to have a
determination made that it it is actually your
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last will. Before it is going
to be admitted into probate. There's then
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going to be an inventory that's going
to be prepared that identifies all the different
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assets that you own, a process
for paying debts, notifying creditors, and
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then ultimately distributing the remaining assets to
beneficiaries. That essentially is what probate is.
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Now, if you don't have a
will, that you might have what
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we would call an interstate success a
state, and in that case, you
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haven't determined where your assets are going
to go. But the state of Michigan
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has determined where your assets are going
to go. Now, the important consideration
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is this, so what assets are
subject to probate, because not all assets
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are going to go through probate.
Assets that are solely owned by you,
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that don't have either a designated beneficiary
or a POD or a TOD, or
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00:06:06.160 --> 00:06:12.000
not jointly owned with somebody else,
those are the assets that are subject to
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going through probate. That would include
any real estate that's just in your name,
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bank accounts that are in your name, investments that are in your name.
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Amanda's working on in a state right
now where an individual had an IRA,
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but the estate was made as the
beneficiary of the IRA, and so
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in that case, that IRA is
now going to have to go through probate.
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Other assets such as vehicles, personal
properties, etc. So anything that
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you own solely in your name that
does not have a beneficiary or TODPOD and
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is not jointly owned by with somebody
else are the assets that typically will go
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through probe. So those are the
things that are going to go through probate.
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Now. A common misconception, though, is that having a will somehow
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means that your assets will automatically avoid
probate. Not true though, because the
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will is essentially the roadmap for the
probate court that says, whatever assets I
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have that do go through probate.
So again, if you have a house
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that's just in your name, or
bank accounts that are just in your name,
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or vehicles that are just in your
name, or investments that are just
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in your name, the will essentially
is a roadmap for the probate court and
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your personal representative to determine where those
assets are going to go through the probate
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process. Through the probate process,
what does that mean. That means that
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even if you have a will,
Even if you have a will, you
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might have assets that are going to
go through probate. Essentially, if you
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don't own anything at the time of
your death, if you don't own any
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00:08:15.920 --> 00:08:20.639
real estate in your name, or
have any assets that don't have TOD or
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pod BET designations on them, or
you don't have jointline assets. If you
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essentially don't own anything at the time
of death that's in just your name,
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those assets won't go through probate.
But it's not your will that is causing
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that to happen. It's the fact
that you simply don't have any assets that
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have to go through probate. The
will, though having a will, I
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00:08:48.720 --> 00:08:54.080
tell clients all the time, here's
consideration a will. Couple considerations important to
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remember. One, a will is
a meaningless document will two things happen,
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00:09:01.200 --> 00:09:09.000
one you die, and two a
probate estate is opened and your will is
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00:09:09.039 --> 00:09:13.480
admitted to probate. Until then,
it's a meaningless piece of paper. So
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00:09:15.279 --> 00:09:18.879
having a will, simply having a
will that says here's where I want my
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00:09:18.039 --> 00:09:24.840
estate to go, doesn't control whether
or not your state's going through probate.
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What controls whether or not your state
goes through probate is do you have any
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assets that have to be excuse me, that have to be probated. If
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you do, then your state those
assets are going through probate. If you
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don't, then those assets are not
going through probate. So the will doesn't
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control that. The will simply controls
what happens when assets do go through probate.
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Now, many clients are going to
look at their state and say,
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00:10:01.039 --> 00:10:07.440
hey, I for whatever reason,
could be cost, could be other issues
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00:10:07.480 --> 00:10:13.000
that I've talked about in previous episodes
of this program. Maybe protecting my privacy,
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00:10:13.639 --> 00:10:20.320
maybe making sure that the children get
along after I death, So we
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00:10:20.399 --> 00:10:24.279
want an expedited settlement of the estate. A number of different reasons that clients
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00:10:24.279 --> 00:10:31.440
are going to have to avoid probate
or minimize if you will, what would
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00:10:31.480 --> 00:10:39.759
have to go through probate. You
start looking at those strategies, those strategies
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00:10:39.879 --> 00:10:45.240
which again are not having a will. It's going to be things like using
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00:10:45.559 --> 00:10:52.919
nonprobate transfer mechanisms such as using beneficiary
designations. If I have a bank account,
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00:10:52.480 --> 00:10:58.159
and on my bank account, I
have a beneficiary designated who's going to
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00:10:58.240 --> 00:11:01.279
receive that account when I die,
or it might be a payable on death
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00:11:01.399 --> 00:11:07.399
or transfer on death, that account
is not going through probate if that person
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00:11:07.480 --> 00:11:11.600
is still alive at the time of
my death. I might have jointly owned
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00:11:11.600 --> 00:11:16.559
assets. Perhaps you're married and you
and your spouse jointly own your home.
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00:11:16.279 --> 00:11:20.840
When one of you dies, that
home is not going through probate because it
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00:11:20.879 --> 00:11:30.159
is jointly owned with your spouse.
So you look at nonprobate transfer mechanism things
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00:11:30.200 --> 00:11:33.000
that you can do with your assets. If you're going to have real estate,
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00:11:33.039 --> 00:11:37.279
maybe we're going to use a Lady
birdt a tool that can be used
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00:11:37.320 --> 00:11:45.240
to have real estate avoid having to
go through probate. Another very common planning
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00:11:45.240 --> 00:11:52.399
option that will be appropriate for some
clients would be having a revocable living trust.
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00:11:52.799 --> 00:11:58.600
You create a revocable living trust,
you transfer assets into the trust during
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00:11:58.639 --> 00:12:03.000
your lifetime. Those assets that are
now in your trust are not subject to
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00:12:03.039 --> 00:12:09.799
probate because they are no longer owned
by you individually. They are owned by
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00:12:11.080 --> 00:12:18.559
your trust. So if in looking
at your estate and evaluating what you want
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00:12:18.600 --> 00:12:22.960
to accomplish with your estate plan,
and if you determine as part of that
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00:12:22.960 --> 00:12:30.679
that avoiding probate is an important consideration
for you, simply remember a will is
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00:12:30.799 --> 00:12:37.039
not going to avoid probate. You
need to use other tools that are going
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00:12:37.080 --> 00:12:45.279
to be available. So while the
will can be a critical document depending upon
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00:12:45.320 --> 00:12:52.960
the nature of your state, understand
that the probate process happens in respect based
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00:12:54.039 --> 00:12:58.960
upon the assets that you have,
and not whether you do or do not
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00:12:58.279 --> 00:13:26.360
have a will. Of course,
Amanda and I would be honored to have
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00:13:26.440 --> 00:13:31.320
the opportunity to help you protect your
loved ones by putting together your state plan,
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00:13:31.720 --> 00:13:37.399
and if that includes avoiding probate,
what strategies can be utilized to accomplish
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00:13:37.440 --> 00:13:41.519
that goal, or perhaps amending a
plan that you already have, even if
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00:13:41.559 --> 00:13:46.000
it's one that we didn't prepare,
or assisting you in settling a loved one's
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00:13:46.320 --> 00:13:54.360
estate. We have in person consultation
at our New Grand Rapids headquarters. We
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00:13:54.519 --> 00:14:01.480
have in person consultation at our East
Lansing location. We have virtual consultations via
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00:14:01.600 --> 00:14:05.440
Zoom or telephone, So wherever you
happen to be in the state of Michigan,
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00:14:07.240 --> 00:14:13.360
we can likely assist you with your
estate planning needs. Remember to we
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00:14:13.480 --> 00:14:18.039
have our legal store. Through the
legal Store, you can order individual legal
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00:14:18.080 --> 00:14:26.759
documents that you might need, perhaps
you're looking to replace, maybe just your
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00:14:26.759 --> 00:14:30.759
healthcare power of attorney well, you
don't need to have an entire estate plan
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00:14:30.879 --> 00:14:35.039
redone, just for a new healthcare
power of attorney. If you're our legal
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00:14:35.039 --> 00:14:39.639
store, you would be able to
order that document online and have it delivered
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00:14:39.679 --> 00:14:46.320
to you through email. More information
on all that, how to schedule a
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00:14:46.360 --> 00:14:52.960
consultation with us, and what information
on our legal store and ordering documents,
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00:14:52.960 --> 00:14:58.039
they are all available at our website. That's Doyle LAWPC dot com. Again,
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00:14:58.120 --> 00:15:15.720
that's Doyle Law PC dot com.
Well, I think that is going
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00:15:15.799 --> 00:15:18.759
to be it for today's show.
As always, Oh, if you have
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00:15:18.919 --> 00:15:22.679
a comment about our program, if
you have a topic that you'd like to
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00:15:22.679 --> 00:15:26.600
have me discuss, or perhaps questions
that you would like to have answered.
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00:15:28.240 --> 00:15:33.120
Much of what I talk about during
the program is in response to questions that
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00:15:33.159 --> 00:15:39.240
we are asked, either in person
or via email or via the Tuesday with
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00:15:39.320 --> 00:15:43.240
Tom website. If you have any
of that, simply head on over to
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Tuesday with Tom dot com. There
you have the ability to leave a voice
152
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message by clicking on the microphone or
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Simply do a search for Tuesday with
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with Tom. Well, thanks again for
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00:17:08.880 --> 00:17:14.039
spending some of your time with us
today, and as always, I hope
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00:17:14.039 --> 00:17:21.480
that you have an awesome day and
an awesome week in Michigan. Stay safe.
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00:17:23.839 --> 00:17:27.400
Tuesday with Tom has been brought to
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Doyle Law PC. To learn how
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00:17:33.359 --> 00:17:37.559
or with settling a loved one's estate, please call us today at five one
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