When it comes to planning for the future, there are many things Massachusetts keep in mind. One focal point in an estate plan is to avoid probate. This process is known to me time consuming and costly. Additionally, it could cause heirs to dispute over certain assets or real property. While many actions taking during the estate planning process and throughout a person’s life seek to avoid the downsides of probate, the reality is that some of these actions could result in a more difficult situation for the individual during his or her lifetime and heir heirs during the estate administration process.
A major asset many individuals have is a home. Thus, knowing what will happen to their home after their passing is important to most homeowners. In some cases, aging parents will add their adult children to their house deed or even give them their house outright. In the moment, this can seem like a really smart step to take; however, it could have unintended outcomes that may not benefit them or their heirs.
While this transfer during one’s lifetime will help them avoid probate for this property, this decision could result in major consequences. When one gifts a home, this results in a large, unnecessary tax bill. Additionally, it could put the house at risk if the adult child is sued or decides to file for bankruptcy. And if this decision was made with the hope that it will prevent the house from being consumed by nursing home bills, one could be mistaken.
In order to avoid these pitfalls but also avoid probate, one should consider a transfer on death deed. This allows an individual to leave their beneficiaries their home without having to go through the probate process. Another option is to utilize a living trust. This can ensure that all assets avoid probate process.
Planning for the future can be difficult. There are many questions and what if’s, making it challenging to know exactly what to expect. However, conversing with a legal professional could help outline one’s needs and goal as well as what they want to accomplish through these objectives. This could ease the probate process, evening allowing for its avoidance.