When a person passes away, not everything they own goes through probate. If their name is the only one on the title to a home, vehicle or bank account, only the court can take their name off and put another person’s on. Read further to learn how certain assets are safe according to probate law in Chicago.
Jointly Owned Assets
If assets are jointly held, they automatically transfer to a surviving owner. The transfer happens immediately upon an owner’s death. However, if the surviving owner passes on without choosing another owner, or if both owners perish at the same time, the asset must go through probate.
Some assets, such as IRAs, retirement accounts, insurance policies, and certain bank accounts, allow the owner to choose a beneficiary. When the person dies, the assets are paid directly to the named beneficiary. However, certain exceptions exist. If a beneficiary dies before or at the same time as the owner, the asset must go through probate with everything else.
Problems with Beneficiaries
If a beneficiary becomes incapacitated, Illinois probate courts will likely assume control of the funds via a conservatorship or guardianship. This is because an institution will insist on the court’s supervision and they will not intentionally make payments to someone who is incompetent. When a person lists their estate as a beneficiary, the court must find out who is included in that estate, and funds will go through probate.
When minors are named as beneficiaries, the probate court will likely establish guardianships for them. Most institutions do not pay directly to minors or to others for the minor’s benefit; they prefer not to assume the legal liability and they typically require court-supervised guardianships.
Assets in a Trust
Assets in trusts, such as revocable living trusts, avoid the probate process. However, if a person has a testamentary trust (a trust that’s included in their will), their assets are probated. The will and everything in it must go through probate before the trust takes effect according to probate law in Chicago. Any assets left out of a living trust will likely go through the probate process.
Many people are worried about what will happen to their assets after they die, and attorneys can take certain steps to help clients protect those assets. For more information or to schedule a consultation, call Starr, Bejgiert, Zink & Rowells today. Like us on Facebook.