Farm Horizons • June 6, 2016 • Page 11
sound mind, it must be in writing, signed by you and two witnesses, and you must intend for the document to operate as a will. In the will, you can spell out how your estate will be distributed and who the executor will be.
By having a will, certain items do not need to be probated. Probate is the legal process of settling your estate; property is inventoried, debts are paid, and whatever is left over is distributed to your heirs. Probate must be initiated within three years after the decedent’ s death.
Some specific items that are not subject to probate are joint tenancy property, joint bank accounts, payable-ondeath accounts, and life insurance proceeds.
Payable-on-death accounts are typically bank accounts, either checking or savings. There is a version of a payable-on-death deed or title transfer also. Life insurance proceeds usually have a designated beneficiary that the value of the policy will go to. You need to have a designated beneficiary listed, or it goes to your estate and that is what we are trying to avoid with life insurance.
In probate, the executor may pay debts and distribute the inheritance and manage the estate. Probate can be either informal or formal, which often depends on the size and complexity of the estate. In a formal probate,
the judge will appoint a personal representative or executor, and the judge will be a part of the process.
Now that I have taken you on a tour of the estate process, you can, and need to make some decisions. Who do you want your estate to go to? How involved do you want a judge to be in your estate? Who would be your choice for an executor? It is a good idea to name a primary and a second choice, in case the first choice is not available. How much planning do you want to do, or need to do for managing the estate tax liability? How much of your estate / probate do you want to be public? How will this impact the farm operation? How will this impact your family and heirs?
Or, do you wish to take the same road as Prince, and die without a will? Remember, the State of Minnesota has a plan for you, and you or any heirs may not like that plan. It is your choice.
Contact me for more information concerning what you need to know and do before you go to an attorney. By doing, this you can save yourself considerable attorney fees.
Have a profitable day. •
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