If you have started to think about planning your estate, you have probably heard the word probate. What is it? Should you avoid it?
Having a firm grasp of how probate works in Minnesota can help inform smart estate planning decisions.
Defining probate
Probate is the process of settling a person’s estate after he or she dies under state court supervision. When you create a will, you name a personal representative. This trusted person will manage probate tasks such as paying taxes, notifying creditors and distributing property to the beneficiaries named in your will.
Minnesota has both informal and formal probate. Your personal representative can start either process by filing a petition with the court where you resided at the time of your death. He or she may request formal probate if complexities exist in your estate. Otherwise, the state allows informal probate.
Reviewing probate requirements in Minnesota
Not every estate requires probate. For example, Minnesota limits probate to estates worth more than $75,000 in probate assets. Many assets can bypass probate in the state, including:
- Real estate, bank accounts and other property you own in joint tenancy with someone else (the home you share with your spouse, for example)
- Bank and investment accounts with an established payable on death beneficiary
- Retirement, pension and life insurance funds with an established beneficiary
- Assets held in a trust
Set a reminder to check your beneficiaries each year. Otherwise, some assets may go to the wrong person or unintentionally end up in probate. If your goal is to help your surviving family members avoid probate, plan your estate accordingly based on these state guidelines.