Many Coloradans may wish to avoid having their estate go through probate upon their death. After all, the probate process takes time and costs money, thus diminishing the value of their estate. However, there are certain ways property can be passed on to your loved ones while bypassing the probate process.
For example, if property is owned by joint tenants with a right of survivorship, it will not go through probate when one tenant dies. Instead, it will be passed on entirely to the surviving tenant. This is because joint tenants have equal shares in the property at issue concurrently and under the same ownership documents.
In addition, if an asset has a designated death beneficiary, it may bypass the probate process. For example, a person could have a bank account or retirement account that designates their spouse or child as the person who will receive the account assets when the account holder passes away. Since the property is not considered part of the deceased’s estate, but, instead, is directly passed on to the named beneficiary, it will not be subject to probate.
Establishing a revocable living trust is another way to avoid probate. A person known as the grantor places their assets in the revocable trust while they are still alive. Once that is done, the trustee of their choosing will own and manage the trust assets in a way that is in the grantor’s best interests and per the terms of the trust itself. As the name implies, if a trust is revocable, the grantor has the right to change the terms of the trust during their lifetime. Establishing a trust can be complex, so many choose to seek legal guidance before doing so.
These are only some examples of how property can bypass the probate process. In the end, there are legal formalities that must be met and documents that must be executed to successfully use one of these estate planning vehicles. Therefore, those wishing to avoid probate will want to make sure they understand exactly what is required to do so before proceeding.