What types of assets are subject to probate?

Generally anything that isn't owned by a trust, co-owned with someone else, or without a beneficiary designation must go to probate.

Elissa

Published January 26, 2021|3 min read

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Key Takeaways

  • Probate assets determine the value of the deceased person's estate

  • Certain assets that aren’t subject to probate can transfer to beneficiaries outside of court proceedings and regardless of the terms of a will

  • The executor must understand the difference between probate and nonprobate assets when handling the decedent’s affairs

  • Proper estate planning, like opening a trust, can help limit the size of the probate estate

Assets that can be transferred by the terms of a will must go through the probate process before beneficiaries can receive them. Assets that can pass without a will — such as through a trust, beneficiary designation, or certain forms of joint ownership — are not subject to probate. It is important to understand which category a decedent's asset belongs to because it can help the executor or administrator determine what type of probate proceeding should be used. 

Probate is the process of settling the decedent’s estate, which includes proving the will if there is one and making sure assets are distributed to the proper beneficiaries. With a well-crafted estate plan, you can decrease the number of probate assets, and potentially cut down on probate costs and how long probate takes.

What are probate assets?

Probate assets are assets that do not have a beneficiary designation, are solely owned by the decedent (deceased person), or owned jointly with someone else as tenants in common. High-value assets that meet these qualifications must usually go through probate, and so must anything that a will instructs to transfer into a trust upon the decedent’s death, since it is not yet owned by the trust.  

Here are examples of assets usually subject to probate:

  • Real estate owned solely by the decedent 

  • The decedent’s portion of assets owned as tenants in common

  • High-value personal property, like jewelry, artwork, cars

  • Assets directed to transfer into a trust (like a testamentary trust) upon the decedent’s death

  • Financial accounts that have not been made transferable or payable on death

Related article: Does a will have to be probated?

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How much does an estate have to be worth to go to probate?

Depending on what probate assets make up the decedent’s estate, the executor or administrator may be able to settle the estate without formal probate. Many states offer simplified probate procedures, like summary administration via affidavit, when the estate is valued less than a certain amount. When calculating the value of the estate, you must tally up the value of probate assets.

Read about how a small estate affidavit works and how much the estate must be worth to settle the estate this way. 

What are nonprobate assets?

Property that can transfer directly to a beneficiary without a will doesn’t need to go through probate. For this reason, you can exclude some of these assets from your will. The most common examples of nonprobate assets are:

  • Living trust property (trust assets must be retitled and transferred to the trust prior to the decedent's death)

  • Jointly owned property that passes directly to the co-owner

    • Community property

    • Assets owned as joint tenants with right to survivorship 

    • Assets owned as tenants by the entirety

  • Assets with a designated beneficiary, such as a

    • Bank account

    • Retirement account

    • Brokerage account

    • Government bond

  • Certain assets exempt by your state law (if any)

    • Primary residence for a surviving spouse, as part of a homestead exemption

    • Limited amount of wages, salary, commissions

When your estate consists of only nonprobate assets, you can avoid probate.

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Probate inventory example

Let's look at this example of what might make up a deceased person’s estate, and which ones would be probate assets.

  • A house worth $500,000 held in joint ownership with their daughter

  • A bank account with $5,000

  • An IRA with $20,000

  • An old car worth $10,000

  • A vacation property worth $200,000 owned jointly with a cousin as tenants in common

  • A life insurance policy made payable to the children

  • A trust fund with $8,000

If the decedent owned the house with their daughter as joint tenants with rights of survivorship, the daughter receives the house upon the decedent’s death automatically. This makes the house nonprobate property.

The bank account and IRA would not be probate assets if a designated beneficiary is named to each of them.

The car is typically subject to probate, but some state laws may exempt the decedent’s vehicle from probate if it’s worth under a certain amount.

Under a style of ownership called joint tenancy in common, each person has sole ownership over their share of property. The cousin is not entitled to the decedent’s half of the rental, which becomes a probate asset.

The trust funds are not subject to probate. Trusts assets have their own rules for transferring assets to beneficiaries. You can read more in this explainer on how the distribution of trust assets to beneficiaries works.

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