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Simple English definitions for legal terms
Non-Probate Assets
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A quick definition of Non-Probate Assets:
Non-Probate Assets: Non-probate assets are things that a person owns that have already been given to someone else before they die or have a way of automatically transferring to someone else after they die. These things do not have to go through a court process called probate, where a judge decides who gets what. Examples of non-probate assets include things like life insurance policies, retirement accounts, and joint bank accounts.
A more thorough explanation:
Non-probate assets are assets that have already been transferred to another person before the owner's death or assets that have a survivorship mechanism in place. These assets do not go through probate court and are not distributed according to the owner's will.
- Jointly owned property
- Retirement accounts with named beneficiaries
- Life insurance policies with named beneficiaries
- Bank accounts with payable-on-death designations
- Trusts
For example, if a husband and wife own a house together, and the deed to the house is in both of their names with a right of survivorship, the house would pass directly to the surviving spouse upon the death of the other spouse. The house would not go through probate court and would not be distributed according to the deceased spouse's will.
Similarly, if a person has a life insurance policy with their spouse named as the beneficiary, the proceeds of the policy would go directly to the spouse upon the policyholder's death. The proceeds would not go through probate court and would not be distributed according to the policyholder's will.