When a loved one passes away, one of the first questions families often ask is: What assets need to go through probate in Tennessee? The answer can be a bit complicated, as it depends on the nature of the asset and how it is titled. Below, we’ll break down what typically needs to go through probate and what does not, helping you better understand the process and know what to expect.
What Is Probate?
Probate is a legal process in which the state oversees the distribution of assets and settling of debt following a person’s death. It involves:
- Authenticating the will (if there is one)
- Inventorying the deceased person’s assets
- Paying any outstanding debts and taxes
- Distributing the remaining assets to the rightful beneficiaries
Probate can be time-consuming and costly, but it’s often necessary to ensure that the decedent’s wishes are honored and that their estate is properly settled according to Tennessee state law.
Probate Assets: What Does Go Through Probate?
In Tennessee, the following assets typically go through probate:
- Individually Owned Property
- Any property solely owned by the decedent, including bank accounts, vehicles, and personal belongings, generally goes through probate unless otherwise directed by a beneficiary designation or a trust.
- Real Estate Owned Solely by the Decedent
- If the decedent owned real estate in their name alone (without a joint owner or a beneficiary designation), it must go through probate. The property will either be distributed according to the will or, if there is no will, according to Tennessee’s intestate succession laws (laws that take effect when there is no will).
- Assets Without Beneficiary Designations
- Accounts like investment accounts, savings accounts, or retirement accounts that do not have a named beneficiary will be subject to probate. Naming a beneficiary on these accounts can help avoid probate.
- Personal Property
- Items such as jewelry, furniture, and collectibles that were owned solely by the decedent are considered part of the probate estate. The executor will inventory these assets and, if necessary, liquidate them to pay debts before distributing the remainder to beneficiaries.
- Assets Held in the Decedent’s Name Only
- Any assets that were titled solely in the decedent’s name and were not transferred to a living trust will require probate. This can include business interests, stocks, or other investments.
Non-Probate Assets: What Does NOT Go Through Probate?
Many assets can bypass the probate process if they meet certain criteria. These include:
- Jointly Owned Property
- Property owned as joint tenants with right of survivorship or tenancy by the entirety (common for married couples) passes directly to the surviving owner and does not need to go through probate.
- Assets with Named Beneficiaries
- Life insurance policies, retirement accounts (like IRAs and 401(k)s), and payable-on-death (POD) or transfer-on-death (TOD) accounts pass directly to the named beneficiaries. These assets are not subject to probate unless there is no named beneficiary or the beneficiary has predeceased the owner.
- Trust Assets
- Assets placed into a revocable living trust before the decedent’s death avoid probate. The trust document directs how these assets should be managed and distributed, allowing for a quicker and more private transfer of assets.
- Small Estates
- Tennessee offers a simplified process for small estates valued at $50,000 or less (excluding real estate). Using a Small Estate Affidavit can allow the beneficiaries to bypass full probate proceedings, acceleratin the asset distribution process.
Why Does It Matter?
Understanding what assets typically go through probate can help you plan your estate effectively to minimize or even bypass probate entirely. There are many benefits of avoiding probate, including:
- Saving time and money, and ensuring that your beneficiaries receive the maximum inheritance possible.
- Maintaining privacy, since probate proceedings are public records.
- Providing a smoother transition of assets to your loved ones.
How to Avoid Probate in Tennessee
The best way to avoid probate in Tennessee is by working with a skilled attorney to create an estate plan. At the Ebbert Law Firm, we have the expertise to help you create a plan that will protect your assets, minimize legal complications for your loved ones, and secure your legacy. Here are some of the strategies our legal team will ensure that you have in place to help you avoid probate:
- Establish a revocable living trust and transfer assets into it.
- Name beneficiaries on retirement accounts, life insurance policies, and bank accounts.
- Own property jointly with rights of survivorship.
- Use payable-on-death (POD) or transfer-on-death (TOD) designations for applicable accounts.
Reach Out to the Ebbert Law Firm Today
Probate can be a complex and lengthy process, but with proper planning, many assets can bypass it entirely. If you’re unsure about which of your assets may require probate or how to best protect your estate, consulting with an experienced estate planning attorney is a critical first step. Our experienced team at the Ebbert Law Firm can help you develop a strategy that ensures your wishes are honored and your loved ones are taken care of efficiently.
If you have questions or need assistance with estate planning or probate in Tennessee, reach out to the Ebbert Law Firm today. We’re here to help guide you through the process and provide peace of mind for you and your family.