What Property Is Exempt From Tennessee Probate?
Probate in Tennessee can be a lengthy and time-consuming process, but if an estate plan is structured by an experienced estate planning attorney most of a person’s estate can bypass the probate process entirely. Certain property can be exempt from the probate process, saving your loved ones time and providing them with a greater inheritance after your passing. To learn more about what types of property can forego the probate process, call or contact the knowledgeable Williamson County lawyers at Fort, Holloway, & Rogers today to schedule a consultation.
Exempt Types of Property
Assets that pass to new owners automatically upon the death of a person can be exempt from the probate process. All other property that is in the deceased person’s name or was owned by them outright must go through the probate process. Exempt property in Tennessee can include the following:
Joint Tenancy and Tenancy in the Entirety Property
Property held in joint tenancy or in tenancy by the entirety can bypass the probate process. This typically applies to real estate but can also apply to financial accounts and other types of assets. In joint tenancy, when one owner of the property dies the other owner automatically becomes the sole owner. In tenancy by the entirety, spouses can co-own property and when one spouse dies the other automatically becomes the only owner.
Payable-on-death and Transfer-on-death Accounts
Payable-on-death and transfer-on-death accounts are ownership methods for bank accounts and other financial instruments that allow for the assets to bypass the probate process. Payable-on-death (POD) accounts apply to bank accounts like checking and savings, and when the holder of the account dies it passes directly to the POD beneficiary. Transfer-on-death (TOD) accounts apply to securities and operate the same where upon the death of a security holder it is transferred directly to the TOD beneficiary without passing through probate.
Life Insurance and Retirement Accounts
Life insurance policies and retirement account proceeds are also exempt from the probate process in Tennessee. If the life insurance policy names a beneficiary, the proceeds are paid out without going through probate, and the same applies to retirement accounts so long as at least one beneficiary is named to the accounts.
Living Trust Assets
Finally, any assets placed in a living trust can bypass the probate process in Tennessee. Almost any type of asset can be placed in a living trust, from real estate and collectibles to securities and intellectual property rights. Any assets in a living trust are distributed according to the trust document to the named beneficiaries without the need for probate.
Small Estate Exemption
There is also a probate exemption for property in small estates. If an estate is worth less than $50,000 without any real estate, Tennessee provides for a simplified process to transfer these estate assets. However, real estate must still pass through the probate process if not held in joint tenancy or tenancy in the entirety.
Talk to Our Office
If you would like to learn more about ways to bypass the probate process with your estate assets, call or contact the experienced Franklin estate planning & probate attorneys at Fort, Holloway, & Rogers today.