Probate is the process of getting a court to say who owns a deceased person's property. Many people plan in advance to avoid probate but it becomes unavoidable if there is property with a title such as real estate or a bank account that requires a court order to transfer to the heirs.
The following assets pass outside of probate:
- Assets in a valid trust.
- Assets which have a payable on death or transfer on death provision.
Financial accounts and even Nevada real estate can be titled in a way that upon death of the original owner, a specific person will own the property. In such a case, if the specific person fails to survive the original owner then that asset will have to through probate.
Important Note on Title Insurance:
Unfortunately, Nevada Title Insurance Companies are now refusing to issue title insurance on Nevada Real Estate which passes on a transfer on Death Deed until 18 months after the death of the Grantor. In our opinion this is contrary to public policy, and this behavior has th effect of making the Transfer On Death Deed less attractive in some cases as a cheaper alternative to a trust.
- Assets which are considered to be held by two or more people as joint tenants.
With respect to motor vehicles, a car titled to John and Mary Doe is considered held in joint tenancy so that if John dies, Mary owns it. With real estate a deed must say that the people hold as joint tenants or with right of survivorship. A deed to "John and Mary Doe, as husband and wife," does not contain either magic phrase. In that case if John dies, his "half" of the property must be probated. If the deed were to John and Mary Doe as joint tenants, if John died and Mary survived him, she would own the whole property.
- Life insurance proceeds to the extent that a beneficiary is named who survives the person the policy was on.
- IRA or other retirement accounts to the extent that a beneficiary has been named who survives the person holding the account.
As a practical matter, if Dad dies leaving a valuable coin collection and nothing else and all of the family is in agreement on what to do with the coin collection, the family may, simply divvy up the coin collection without involving the courts or lawyers. While technically wrong, I suspect this happens a lot.