Sam's gross estate will increase by $225,000 from these assets ($50K + $75K + $100K). The joint CD will now be owned 100% by his wife. The life insurance proceeds will go to his wife free of gift and federal income tax.
Tenancy by the entirety and community property are property arrangements between spouses only.
Community property is a property agreement between spouses and does not avoid probate. Assets purchased with community property funds are considered community property.
Tenants in common are free to transfer their respective shares of the property to other individuals.
Traditional IRA accounts pass by "contract" which means whoever is named as the beneficiary on the account will receive the assets. Beneficiary designations take precedence over trust and will declarations.
Individual accounts and tenancy in common property ownership will both be probated at the death of the owner. TOD (transfer-on-death) and POD (payable-on-death) are both effective beneficiary assignment strategies used to avoid probate. Revocable trusts will also avoid probate, even though these assets are generally included in the gross estate of the grantor.
7. A Death without a will is known as "intestate."
Some might consider creditor notification as another disadvantage; however, it is not. It sets a statute of limitations for creditors to come forward to file their claims. This prevents creditor issues in the future on the decedent's property.
Annuity contracts and life insurance both pass by contract and avoid the probate process.
Managing WealthThis article explains the difference between the two estate transfer methods -- a will and a trust, and the circumstances under which each can be used.
Financial AdvisorEvery advisor and saver needs to know these three estate planning secrets.
Personal FinanceThis arrangement allows beneficiaries to access your account without having to go to court.
RetirementFind out how best to claim and convey ownership on your assets.
Financial AdvisorA look at wills versus living trusts and when to choose one over the other.
RetirementFind out why you shouldn't put off putting your affairs in order.
Personal FinanceA beneficiary is a person or entity that receives funds, assets, property or other benefits from a trust, will, or life insurance policy.
RetirementListen up: Hidden in the pesky details of filling out 401(k) forms are important tax implications. And it's a legacy to people you love.
Financial AdvisorTrusts and wills are both means to pass on wealth to heirs. Which of these is likely to serve your needs better if you have considerable wealth?
Financial AdvisorA quick estate planning guide for high-net-worth individuals to help minimize taxes and costs, protect assets and plan for care.