Probate is the legal process which transfers a person’s assets to their heirs or beneficiaries after death. In Maryland, the probate process can be lengthy, costly, and public, so many people look for ways to avoid it. Here are some strategies for avoiding probate in Maryland:
Establish a Revocable Living Trust
A revocable living trust is a legal document that allows you to transfer ownership of your assets to a trust during your lifetime. When you pass away, the assets in the trust can be distributed to your beneficiaries without having to go through probate. To establish a living trust in Maryland, you would need to work with a Maryland estate planning attorney to create the trust document and to make sure that transfer your assets are appropriately transferred into the trust; otherwise, they may still be subject to probate.
Many assets, such as retirement accounts and life insurance policies, allow you to designate beneficiaries who will receive the assets after your death. By selecting beneficiaries, you can ensure these assets pass directly to your heirs without going through probate. Regularly reviewing and updating your beneficiary designations is important to ensure they reflect your current wishes.
Own Property Jointly
If you own property jointly with another person, such as a spouse or child, the property will automatically pass to the surviving owner upon your death without going through probate. This is because most kinds of joint ownership include a right of survivorship, which means that when one owner dies, their share automatically transfers to the surviving owner. However, it’s important to note that joint ownership can have other implications, such as potential tax liabilities and complications in the event of a divorce, bankruptcy, or even disputes over what to do with the property—putting another person as a co-owner on your property is non-revokable—you cannot change your mind later on.
Enter Into a Life Estate Deed
Many of the issues regarding the joint ownership of property are solved by the filing of a Life Estate Deed, which allows the owner to maintain complete control over the property during their lifetime, but provides that the property will pass directly to the “remainder person” after the owners death. This method can also avoid tax consequences, and allow the owner to change their mind later on.
Use Payable-on-Death Accounts
Some financial institutions allow you to establish payable-on-death (POD) accounts, which name a beneficiary who will receive the account funds after your death. Like beneficiary designations, POD accounts allow assets to pass directly to your heirs without going through probate. However, beneficiary information must be up-to-date and accurate.
Work with a Reputable Estate Planning Attorney
One of the best ways to avoid probate in Maryland is to work with a knowledgeable and reputable estate planning attorney like DK Rus Law. With over 25 years of experience, D. Kathleen Rus, Esq. understands what it takes to avoid probate and how to craft indisputable estate planning documents that protect you, your loved ones, and your assets. Contact us today to start planning.