When a decedent resided in the state of Virginia and owned real estate property in other states, another probate procedure may be required for any beneficiaries to obtain possession. This is referred to as ancillary probate and happens in addition to the primary probate proceeding. Let’s take a look at how it works – and ways you can avoid it.
What is Ancillary Probate?
Suppose you reside in the state of Virginia but own a vacation home in Florida. When you pass away, your will is going to be recorded at the circuit court of the county where you resided in Virginia. Your will gets admitted to the court, and after validating it, the court will appoint an executor to administer your estate.
Your executor will gather an inventory of all your assets (both tangible and intangible), identify and contact your beneficiaries, and pay off any debts and taxes owed by your estate. The court will then authorize the distribution of your assets according to your will, and the estate will be closed.
At the same time, once the court has determined your will is valid, your executor may be required to file a letter of qualification along with a certified copy of the will to all the states where you owned properties. In our example, your primary probate would take place in Virginia, and ancillary probate would be conducted in Florida. Once all the requirements have been met for the ancillary probate proceeding, your properties can then be passed on to heirs. Each state has different laws and probate requirements, so you may want to check the rules of that state or hire a probate attorney that is barred in that jurisdiction.
How Can You Avoid Ancillary Probate?
The strategies to avoid the need for ancillary probate are very similar to those used to avoid probate in your state of residence. There are a few strategies you can use, but make sure to check local probate rules and laws to see if these strategies are right for you. First, you can choose to own property jointly with another person. Any real estate property placed in joint tenancy with the right of survivorship, tenancy by the entirety or community property with the right of survivorship will be automatically transferred to the joint owner without needing probate.
What is a Transfer-on-Death Deed?
Another option is using a transfer-on-death deed where allowed. Virginia is one of 27 states that allow transfer-on-death deeds where the current owner designates a beneficiary that automatically becomes the owner when the original owner dies, no probate required. And finally, you may choose to place your out-of-state property into a revocable living trust. Your real estate property would be titled to the trust and would be transferred directly to beneficiaries upon your death. You can use this both for out-of-state assets as well as for assets in your home state.
Early planning is key to simplify the process of transferring your assets to your loved ones after your death. Having multiple probate proceedings can be costly and time-consuming, depending on how many out-of-state assets you have. The Johnson Law Firm, PC can help you craft an efficient estate plan that can save your family time and preserve more of your assets for the next generation. Contact us today for a consultation and get started.