What Property Does Not Pass Under a Will in Maryland?
Certain property cannot be included in a will. It is important to learn which property is probate property and which is non-probate property so that you have a clearer idea of how your assets will be handled after your death.
If property does not pass under a will, it is exempt from the probate process. Non-probate property includes property held in trusts, joint tenancy properties, and assets with designated beneficiaries, like life insurance policies or retirement plans. All other property, such as solely-owned real estate or personal property, like jewelry or collections, is probate property. This means you can designate beneficiaries of such property in your will. Our attorneys will help you distinguish between probate property and non-probate property so that such matters are handled. This can allow you to avoid confusion among beneficiaries after your death in Maryland.
To have our Maryland wills and estate planning lawyers review your case for free, call Rice, Murtha & Psoras today at (410) 694-7291.
Property that Does Not Pass Under a Will in Maryland
Certain assets and property are non-probate property, meaning they cannot be passed through a will. These include property or assets designated to trusts prior to a testator’s death, property or assets owned by a testator and their spouse, and assets with designated beneficiaries, such as insurance policies.
Property in Trusts
If you placed certain property in a trust before your death, it will not have to go through the probate process following your death. For example, suppose you set up a trust for your child while you were alive. This might include bank accounts, real estate property, stocks, and bonds. You can also put tangible personal property in a trust. Because these assets are in a trust and not listed in your will, they will transfer to the beneficiary of the trust at the proper time. Suppose you made a trust for your child and included a contingency that they receive the assets in the trust when they graduate college, for example. In that case, your wishes will be carried out accordingly, even if you die before that time, as the property within the trust is non-probate property.
Joint Tenancy Properties
The same is true of joint tenancy properties. This refers to real estate or assets owned by a testator and their spouse. If a testator dies, their spouse will retain ownership of the property, as they have survivorship rights. These properties will not go through the probate process.
Assets with Designated Beneficiaries
Certain assets have designated beneficiaries irrespective of a will. This includes things like insurance policies, pension plans, and IRAs or other retirement plans. Upon your death, these assets will be distributed among beneficiaries as dictated by your policy or plan. This means they will skip probate.
Property that Does Pass Under a Will in Maryland
Probate property, or things you can include in your will, vary. Generally, these include property that is owned solely by a testator.
Probate property includes real estate you own alone or bank accounts solely in your name. Insurance policies without beneficiaries or that list an estate as a beneficiary will also be treated as probate properties. Other probate property includes jewelry, vehicles, clothing, and collections.
Identifying Probate Property vs. Non-Probate Property in Maryland
Knowing which of your property and assets will pass under your will, and which will not, is important. Otherwise, your beneficiaries might face difficulties regarding the distribution of assets after your death.
When executing your will, our Columbia, MA wills and estate planning lawyers will review your assets to determine which are probate assets and which are exempt from the probate process. In doing this, you can get a better idea of how certain assets, like IRAs or insurance policies, will be paid out to your beneficiaries. These assets can become probate property if you name your estate as the beneficiary.
If you include non-probate property in your will, such property will not go through probate. This can leave your beneficiaries confused regarding the distribution of certain assets. We can review your non-probate assets and ensure they are in order so that there is little room for confusion following your death in Maryland.
What Happens to Property that Does Not Pass Under a Will in Maryland?
Non-probate property, or property that does not pass under a will in Maryland, does not just disappear upon an owner’s death.
When items or property do not pass through probate, they will still be distributed to the necessary beneficiaries. For example, if you have a life insurance policy with designated beneficiaries, your insurance company will handle the payout to beneficiaries. Similarly, if you have property in a trust for a specific family member, all distributions will be carried out accordingly.
Being exempt from the probate process means property will not be considered or managed by the personal representative named in your will following your death. Probate property, like solely owned real estate or personal possessions, will be distributed among beneficiaries by your personal representative.
If you own property with your spouse, and your spouse has survivorship rights, your spouse will retain ownership of the property following your death. You cannot designate jointly-owned property to a beneficiary in your will.
If you have probate property but do not have a will, your assets will be distributed according to Maryland’s intestacy laws. Depending on your relationships with your living heirs, like your children, that may not be what you wish. Because of this, it is important to execute a will and file it with the Register of Wills Office in Maryland. If you do not file your will before your death, your loved ones will have to do so to begin the probate process.
Call Our Maryland Attorneys to Discuss Your Will
You can call our Annapolis, MD wills and estate planning lawyers at (410) 694-7291 to schedule a free case evaluation from Rice, Murtha & Psoras.