Having one's assets pass down to the intended heirs is the primary purpose of many Philadelphia estate plans. While a will can accomplish that goal, an estate that is built solely around a will is required to pass through probate. Probate is the legal process by which an estate is settled, including paying all debts, collecting assets and ensuring that the proper parties receive their intended inheritance. If one or more individuals decides to open an inheritance dispute, things can become very complicated very quickly.
One way to reduce the risk of an inheritance dispute is to take steps to pass assets directly to the intended heirs outside of the probate process. This means that the individuals who have been selected to receive certain assets will have access to that wealth immediately upon the death of the grantor. Launching a dispute against this type of transfer is more complicated than disputing a will and has a lower chance of success unless the challenging party can prove that coercion or fraud was at play in the grantor's decision-making.
Many families choose to create a revocable trust to hand assets down to loved ones. The trust is funded with the assets that will make up the inheritance, and the beneficiaries are named. At the time of the grantor's death, the beneficiaries will receive their inheritance. Trusts give the grantor a great deal of control over who will inherit what. They also protect the assets against loss during the grantor's life.
Another option is to designate one's intended heir as a joint owner of certain types of assets. This can be a good option for families who want to pass down a piece of real estate, vehicle or bank accounts to various loved ones. Here again, the asset becomes the property of the beneficiary at the time of death. The disadvantage of joint ownership is the fact that the asset becomes subject to risk of loss due to divorce, tax liens or legal judgments.
In deciding how to structure an estate plan, Philadelphia families have a number of options. For those who feel that an inheritance dispute is possible, there are ways to bolster one's estate plan and ensure that the chosen heirs are able to receive their intended inheritance. Every family is unique, but there is an estate planning solution available to fit every set of needs.
Source: nerdwallet.com, "5 Smart Estate-Planning Steps to Avoid Probate", James E. Salter, Feb. 10, 2016