Dealing with probate can be a long and frustrating process. In our latest post, learn how to avoid probate court in New Hampshire!
Nobody wants to have to go through the probate process, especially if they plan to sell the inherited property once their loved ones have passed. By planning ahead, people are able to avoid probate, giving their families the peace of mind they need when dealing with a sad and difficult situation.
Probate court can be a time-consuming, expensive, and emotionally draining process for families dealing with the death of a loved one. Fortunately, with careful planning, you can often avoid probate court in New Hampshire altogether. Here are practical tips to help you streamline the transfer of assets and ensure your wishes are honored while minimizing the legal complexities for your heirs.
Understanding Probate in New Hampshire
Probate is the legal process of settling an individual’s estate after their death. This involves validating the deceased’s will, paying debts, and distributing the remaining assets to beneficiaries. In New Hampshire, probate is typically required if someone dies owning assets in their name alone or without a will. The process can take months, and probate fees can reduce the overall value of the estate.
By taking proactive steps, you can keep your estate out of probate court, save money, and provide a smoother transition for your loved ones.
1. Create a Revocable Living Trust
A revocable living trust is one of the most effective tools to avoid probate in New Hampshire. With this arrangement, you transfer ownership of your assets into the trust while you’re alive. You act as the trustee, retaining control over the trust during your lifetime. Upon your death, the assets in the trust are distributed to your named beneficiaries without going through probate.
Why it works: Since the trust technically owns the assets, they are not considered part of your probate estate. This keeps the distribution of your property private and outside of the court system.
2. Use Beneficiary Designations
Many financial accounts, such as life insurance policies, retirement accounts, and payable-on-death (POD) or transfer-on-death (TOD) accounts, allow you to name beneficiaries. Upon your death, these assets transfer directly to the designated beneficiaries without requiring probate.
Action steps:
- Review all your financial accounts to ensure you’ve named beneficiaries.
- Update beneficiary designations as needed, especially after major life events like marriage, divorce, or the birth of a child.
Tip: Don’t forget about secondary (contingent) beneficiaries in case your primary beneficiary predeceases you.
3. Hold Property Jointly
Another way to avoid probate in New Hampshire is to hold property jointly with another person. For example, married couples can hold real estate as “joint tenants with right of survivorship” (JTWROS). When one spouse dies, ownership automatically transfers to the surviving spouse without going through probate.
Important considerations:
- Joint ownership can simplify estate planning but should be used carefully. Adding someone as a joint owner to your bank account or property means they have equal rights to that asset during your lifetime, which could pose risks.
4. Give Gifts While You’re Alive
One straightforward way to reduce the size of your probate estate is to give away assets while you’re alive. In 2024, the annual gift tax exclusion allows you to give up to $17,000 per recipient without incurring federal gift taxes. Larger gifts may also reduce your taxable estate, potentially saving your heirs on estate taxes.
Benefits:
- By gifting assets, you remove them from your estate, making them exempt from probate.
- You can see your loved ones benefit from your generosity while you’re still alive.
5. Keep Small Estates Simple
In New Hampshire, small estates may qualify for simplified probate procedures. If the total value of the estate is less than $25,000 and does not include real estate, the executor may use an affidavit process to distribute assets without formal probate.
How it works:
- The executor presents an affidavit to financial institutions or other asset holders, proving their right to claim the deceased’s property.
- No court involvement is necessary if the estate meets the threshold.
Tip: While this approach avoids lengthy probate proceedings, it’s still wise to have a will and other estate planning documents in place.
6. Write a Comprehensive Will
While a will alone won’t help you avoid probate, it’s an essential component of any estate plan. A will ensures your assets are distributed according to your wishes and names an executor to oversee your estate. Without a will, New Hampshire’s intestacy laws dictate how your property is divided, which may not align with your preferences.
Key takeaways:
- Use a will to complement other probate-avoidance strategies.
- Be clear about your intentions to minimize disputes among heirs.
7. Consult an Estate Planning Attorney
Avoiding probate requires careful planning and a thorough understanding of New Hampshire’s laws. An experienced estate planning attorney can help you create a customized plan tailored to your unique situation. They can ensure your documents are legally sound and that you’re taking full advantage of probate-avoidance tools.
The Bottom Line
Avoiding probate court in New Hampshire is achievable with proper planning. By using tools like revocable living trusts, beneficiary designations, joint ownership, and strategic gifting, you can save your loved ones time, money, and stress. Working with an experienced attorney ensures your estate plan meets all legal requirements and provides peace of mind for you and your family.
Start planning today to protect your legacy and simplify the future for your loved ones.
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