Any discussion of estate planning should involve an examination of probate to one extent or another.
Just about everyone has heard of a last will. It is the vehicle of asset transfer that is most commonly utilized among people in North Carolina who want to arrange for the future distribution of their financial assets. If you do use a last will, you should understand the fact that the estate must be probated before the heirs receive their inheritances.
Probate in Charlotte North Carolina
During probate the probate court in Charlotte North Carolina will supervise the administration of the estate. The court must determine the validity of the will and make sure that everything is done according to state laws.
The executor or personal representative of the estate is charged with the estate administration tasks. These tasks can be considerable.
During probate the estate must pay all valid final debts. This is going to include tax responsibilities. Property that comprises the estate must be appraised and liquidated in preparation for distribution to the heirs.
The above can sound like a matter of writing a few checks and calling in an appraiser and a liquidator. However, in many cases preparing the assets for distribution can be complicated and time-consuming.
For example, imagine real property being part of the estate. It must be sold before the liquidity can be distributed among multiple heirs. This is not something that is necessarily going to happen overnight.
Liquidation can take time. If there are any challenges to the estate this would draw things out as well. Complicated probate cases can take years. Even very simple and straightforward cases are going to take months.
The time involved is one of the drawbacks of probate. Remember, the heirs to the estate do not receive their inheritances until the estate has been probated.
In addition to the time lag, another factor to consider would be the costs that will accumulate during the probate process. The court charges a filing fee, and the executor is entitled to payment. Appraisals and liquidation costs will add up, and there will typically be legal fees and accounting expenses.
Avoiding Probate Drawbacks
Is it possible to avoid the drawbacks of probate? The answer is yes. There are multiple different probate avoidance tools that can be utilized. One of them would be the revocable living trust.
With a revocable living trust you name a trustee to administer the trust along with a beneficiary or beneficiaries. After you pass away, the trustee distributes assets to beneficiaries according to your wishes as stated in the trust agreement.
The property that has been conveyed into the revocable living trust is not considered to be probate property. As a result, the asset distributions take place in a timely manner outside of probate.