Estates and Probate 101

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Estates and Probate 1012019-12-08T20:01:20+00:00
ARE THERE DIFFERENT TYPES OF ESTATES?2019-12-06T13:21:14+00:00

There are three types of estates: Regular Estate, Small Estate and Estate for Legal Actions. Small Estates are those estate that do not contain any real property, or personal property valued more than $25,000.00. Regular Estates are estates with any personal property or real property. Estates for Legal Actions are estates open for wrongful death actions.

WHEN DO I HAVE TO GO THROUGH PROBATE?2019-12-06T13:20:00+00:00

In South Carolina, you have to open an estate if the decedent had any personal or real property, regardless of the value.

PROBATE2019-12-06T13:18:31+00:00

“A probate is a legal process in which a will is reviewed to determine whether it is valid and authentic. Probate also refers to the general administering of a deceased person’s will or the estate of a deceased person without a will. The court appoints either an executor named in the will (or an administrator if there is no will) to administer the process of collecting the assets of the deceased person, paying any liabilities remaining on the person’s estate, and finally distributing the assets of the estate to beneficiaries named in the will or determined as such by the executor.”

WHAT CAN YOU DO TO AVOID CERTAIN ASSETS GOING THROUGH PROBATE?2019-12-06T13:17:51+00:00

There are several things you can do while you are alive to avoid certain assets going through probate.

Transfer On Death (TOD): “The transfer on death designation lets beneficiaries receive assets at the time of the person’s death without going through probate. This designation also lets the account holder or security owner specify the percentage of assets each designated beneficiary receives, which helps the executor distribute the person’s assets after death. With TOD registration, the named beneficiaries have no access to or control over a person’s assets as long as the person is alive.”

Life Insurance & Annuities Beneficiaries: “Life insurance and annuities will pass by contract as well, so it’s just as important that you contact all life insurance companies where you maintain policies to ensure that your beneficiaries are listed correctly.”

Joint Tenants with Rights of Survivorship: “Joint tenants with right of survivorship (JTWROS)… is a type of property ownership, a surviving member will inherit the total value of the other member’s share of property upon the death of that other member.”  When titling real property this way, the real property does not go through probate.”

Trust: “A trust is a fiduciary relationship in which one party, known as a trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary. Trusts are established to provide legal protection for the trustor’s assets, to make sure those assets are distributed according to the wishes of the trustor, and to save time, reduce paperwork and, in some cases, avoid or reduce inheritance or estate taxes.”

KEY DOCUMENTS EVERYONE SHOULD HAVE2019-12-06T13:16:07+00:00

It is important that everyone have a Last Will and Testament, Living Will, Durable Financial Power of Attorney and Durable Healthcare Power of Attorney.

Last Will and Testament: “A written document which leaves the estate of the person who signed the will to named persons or entities (beneficiaries, legatees, devisees) including portions or percentages of the estate, specific gifts, creation of trusts for management and future distribution of all or a portion of the estate (a testamentary trust).”

Living Will: “Also called “a durable power of attorney,” it is a document authorized by statutes in all states in which a person appoints someone as his/her proxy or representative to make decisions on maintaining extraordinary life-support if the person becomes too ill, is in a coma or is certain to die. In most states the basic language has been developed by medical associations or other experts and may provide various choices as to when such maintenance of life can be terminated. The decision must be made in consultation with the patient’s doctor. The living will permits a terminal patient to die in dignity and protects the physician or hospital from liability for withdrawing or limiting life support.”

Healthcare Power of Attorney: “A legal form that allows an individual to empower another with decisions regarding his or her healthcare and medical treatment. Healthcare power of attorney becomes active when a person is unable to make decisions or consciously communicate intentions regarding treatments.”

Durable Power of Attorney: “A power of attorney (POA) is a legal document giving one person (the agent or attorney-in-fact) the power to act for another person (the principal). The agent can have broad legal authority or limited authority to make legal decisions about the principal’s property, finances or medical care. The power of attorney is frequently used in the event of a principal’s illness or disability, or when the principal can’t be present to sign necessary legal documents for financial transactions.”