Here’s one of the most common concerns I hear quite a lot from many of you—how can estate planning help in dealing with properties scattered in different parts of the country?
First off, let me start by saying this: Props to you for giving importance to your loved ones and their future!
Definitely, without advance planning, having properties in different states can be quite a challenge in settling a person’s estate. Whether it’s a rental property, vacation home, or a shared family property, it is quite common to own something outside of your home state. Not to worry--having a plan can simplify all of this. And asking these kinds of questions early on is a step toward eliminating this difficulty, all for the benefit of loved ones and beneficiaries.
So how exactly does estate planning help folks with properties in different states?
Basically, as I said above, a well-thought-out estate plan simplifies the process and minimizes the expenses in dealing with properties in different states, as opposed to when a person does not have a comprehensive plan or any estate plan at all.
Without an estate plan, the common scenario is this: Properties located in different states would have to go through different probate processes. A property in Florida will be subject to Florida’s probate laws and estate taxes, California’s probate rules apply to the property located in the Golden State, New York laws apply to New York properties, and so on. Each probate court would have to appoint an estate administrator or executor for each of these properties, too. Yup, complicated and costly. Yikes!
Yep, that’s right. If someone passes away with property in different states, especially real property, their loved ones have to file probate in EACH state. That means multiple states to juggle (and the different laws/processes that go with it!), multiple judges, multiple attorneys, and definitely increased costs and timelines.
A quick reminder: Probate applies whether you have a will or not. Wills must go through probate to be effective. While a will is a PLAN (and tells the court where/who to give your property), it may not be the best way to handle having property in different states.
Estate planning is here to save the day!
In particular, the property owner can include a trusty tool (pun intended!) called a trust. Through this estate planning instrument, particularly a revocable living trust, you can transfer your properties located in multiple states into the trust, which would then allow your designated beneficiaries to receive these properties directly without the need for probate. That’s right—immediately, privately, and without court interference. This is regardless of where in the country the properties are situated!
Just through the revocable living trust alone, you and your loved ones are already able to save tons of money, particularly by avoiding probate proceedings.
The bottom line? Estate planning plays a HUGE role when it comes to estates composed of properties in different states. Things need not be so complicated! You can definitely do something NOW to make sure that the settlement of your estate goes smoothly later on. Planning ahead isn’t just for you--it gives your loved ones the ease, peace of mind, and confidence to handle your affairs during an already tumultuous time. It is a tremendous gift for those you love.
Want to get started? Allow me to guide you through the process! Sign up for a virtual consultation here. No worries—this consultation is casual, no-pressure, and absolutely free! I would love to hear from you and help you out as you plan for your and your family’s future.
You can also contact me by clicking this link.
Talk to you guys again in the next post!