When you pass away, your property generally passes either to the beneficiaries you have named in your will, or under Florida’s intestacy rules, if there is no will. The process of distributing a deceased person’s estate is called probate and it can be time-consuming and costly.
There are ways to avoid the probate process altogether. Property not subject to probate includes:
- money in a joint bank account
- money in a bank account with transfer on death provisions
- life insurance policies, pension plans and annuities with designated beneficiaries
- property transferred to a trust such as a revocable living trust
In addition to the above, your real estate may also escape probate if you hold titles in one of the following ways:
If your purchase deed indicates that you own the property as joint tenants with a “right of survivorship” upon your death, your property interest passes automatically to the surviving owner or owners without having to undergo probate.
Tenancy by the entirety
This form of ownership, which only applies to married couples, is similar to a joint tenancy. Upon death, your interest automatically passes to the surviving spouse. Note that a tenancy by the entirety is automatically converted into a tenancy in common upon divorce, so if you divorce prior to your death, your half of the property is probated and your ex-spouse retains ownership over the other half.
Although making someone a co-owner of your property in order to avoid probate may seem like a good idea, you should carefully consider a number of issues before deciding to do so. For example, once you have transferred the property, you can’t change your mind. There may be adverse tax consequences that arise from the transfer. You may need to obtain mortgagee’s consent to the transfer. Contact an experienced Orlando estate planning lawyer for advice on this topic.