Probate can easily cost about 3% to 7% or more of an estate’s total value. It may even cost more if an attorney, executor, and accountant are involved in the process. Moreover, the probate proceedings may take up to two years, and the court will freeze all estate’s assets until property distribution is finalized. Fortunately, avoiding probate can help save time and allow the distribution of the estate while saving costs.
If you’re trying to understand how you can avoid your estate going through probate in Colorado, consulting with an experienced probate attorney is crucial for proper guidance. I can help you understand the benefits and risks of avoiding probate and discuss your options. Duncan Legal PC proudly serves clients throughout Centennial, Greenwood Village, Douglas County, Littleton, and Parker, Colorado.
Understanding Probate in Colorado
Probate is a court-supervised process that involves gathering and assessing all the estate’s assets, paying debts and taxes, and determining heirs and beneficiaries. In Colorado, all wills and intestate estates (when a decedent dies without a will) go through probate. However, the degree of court involvement and complexity may vary.
Small estates are estates with a value of less than $50,000 and no real property. Dependents gather the decedent’s assets and swear that they are entitled to them using an affidavit. Assets in small estates may be distributed to heirs without going through probate.
Uncontested estates are an informal probate process that is often permitted when a valid will exist or clear intestacy. Colorado courts play a limited role in uncontested estates. However, they still ensure that provisions of the will or intestacy law are followed.
Contested estates involve a formal probate process when the will is invalid, contested, or when there are administration challenges such as identifying heirs or disputes in the property title. The court is more involved, and the personal representative will need approval for every transaction.
Trusts can be described as a fiduciary relationship whereby an individual is appointed to handle an estate’s final affairs and distribute assets to heirs or beneficiaries. The trust usually contains all estate assets, including real estate property, investments, business interests, and bank accounts. Upon death or unexpected incapacitation of the estate, the appointed trustee steps in and administers the estate according to the trust’s provisions. Some benefits of having a trust include:
- A living trust can help bypass the probate process
- Assets can be kept in trust until a future date, for example, in the case of a minor child
- A trust can help protect you in case of a sudden illness or incapacitation, and specify care decisions
- A trust can help maintain and protect privacy (a will is public while a trust is private)
- A living trust can save money by avoiding the probate process
- A trust creates a clear plan to deal with all of your assets, thus, giving you certainty and peace of mind
In addition to trusts, other options to avoid probate include:
Joint tenancy is also used to avoid probate because property owned in joint tenancy can be passed directly to beneficiaries without probate. Moreover, it is easy and free to set up a joint tenancy. Some drawbacks of a joint tenancy include:
- The last surviving joint tenant will need to avoid probate using another method
- Avoiding probate may not be possible if both owners die at the same time
- In joint tenancy, both owners have an equal share
You can avoid probate using a payable-on-death (POD) bank account. This requires filling out a simple form provided by the bank and naming the beneficiary you want to inherit the money or asset in the bank account after your death.
Another alternative for avoiding probate in Colorado is using a transfer-on-death (TOD) account. This is a special type of account set up for investments such as mutual funds, stocks, and bonds available in a brokerage account. When the account owner dies, the account’s investments and assets will be automatically transferred to the TOD beneficiary, who was named by the owner, without passing through probate.
Getting Help from a Colorado Estate Planning Attorney
Avoiding probate can help fast-track the entire process of distributing an estate at a lower cost. If you’re trying to avoid your estate going through probate, it is crucial to consult with a knowledgeable probate attorney immediately for proper guidance and to protect your rights.
At Duncan Legal PC, I’m committed to providing comprehensive legal guidance in matters of probate, estate planning, trusts, and joint tenancy. As your legal counsel, I will assess your situation and help you understand your available options. I will offer you the proper guidance you need to avoid the entire probate process and navigate critical decisions.
Call Duncan Legal PC today to schedule a one-on-one consultation with an experienced Colorado probate and estate planning attorney. I will offer you the detailed legal counsel and advocacy you need. I proudly serve clients throughout Centennial, Greenwood Village, Aurora, Littleton, Parker, Arapahoe County, Douglas County, Denver County, and Jefferson County, Colorado.