Many Ways to Transfer Property at Death

Many Ways to Transfer Property at Death

They say “Where there’s a will, there’s a way”, but there are a number of ways that property can be passed at death without a will. The probate court provides a process to pass on inheritance to the next of kin of the decedent when he dies “intestate” (without a will). Property can also be passed without probate court involvement if it is held “jointly with right of survivorship” (JWROS), with a designated beneficiary or in a trust.  Ohio law even provides that title to vehicles may pass directly to a surviving spouse without probate.

The first step in sorting out a decedent’s estate is to determine what assets he owned and how they are titled. Heirs or beneficiaries can then follow the procedures required to collect the assets.

Intestate Property

The probate court oversees the process of transferring property held in a decedent’s name alone. Without a will, anyone may apply to administer the estate. The closest relatives living in Ohio have first priority to be the administrator and must be notified or sign off for someone else to administer. The administrator is generally required to post a bond (an insurance policy that he will handle his duties properly) in order to protect all the heirs. Because there is no will to grant powers, the administrator will need to get probate court authority to sell or transfer assets. Once the bills have been paid, the administrator will distribute the remaining assets to the decedent’s next of kin in accordance with the Ohio Statute. The probate process can be complicated so it is best to have an attorney assist with the administration.

Joint with Right of Survivorship

Virtually any type of property can be held jointly with another person; real estate, a bank account, even a vehicle. Just because something is held jointly doesn’t mean the survivor gets to keep the asset when an owner dies, but this is often the case. Most times, a certified death certificate and an affidavit outlining the facts is all that is needed to collect survivorship property.

Designated Beneficiaries

A person can name beneficiaries who are to receive an insurance policy, IRA, annuity, bank account, stock account, house, car or other property when the title owner dies. The designation of a beneficiary is given directly to the insurance company, bank, brokerage, county recorder or whoever keeps the record of ownership. To claim the property, the beneficiary must contact that company or agency to make the claim. Claim forms and procedures vary greatly. Making a claim may be as simple as presenting a death certificate or may involve completing multiple page claim forms that require a medallion guarantee signature from a bank or brokerage. Each beneficiary may be required to make decisions about cashing or continuing the account and withholding for taxes.

In the case of an IRA, for example, a spouse may elect to roll the IRA into her own name, name her own beneficiaries, and wait until she needs to make required minimum distributions. If multiple children inherit an IRA, they can divide it into separate inherited IRA’s and each decide whether to cash out immediately or “stretch” it out for years taking only the required minimum distributions. Each holder of an inherited IRA or inherited Roth IRA must begin taking required minimum distributions immediately and should name beneficiaries for their own account.

Trust Assets

Assets titled to a trust are administered by the surviving or successor trustee as directed by the terms of the trust. If all of the creators of the trust have died and there is no one surviving who can revoke the trust, its’ terms become irrevocable and a federal tax identification number must be assigned to the assets. The Trustee must follow proper protocols for notifying beneficiaries, managing the assets and handling the taxes. A qualified attorney and accountant may be needed to advise the Trustee.

Vehicle Transfer to Spouse

Ohio law allows a surviving spouse to transfer an unlimited number of vehicles to herself so long as the total value is less than $65,000, and so long as there is no one else who owns the vehicle jointly with right of survivorship, is designated a TOD beneficiary or is named in the will to receive the vehicle. To transfer, the spouse must take her ID, the vehicle title or registration showing VIN number, and a certified copy of the death certificate to the county BMV title office, sign an affidavit and pay a small transfer fee.

Handling the transfer of a decedent’s property can be a complicated affair under the best of circumstances. The process can take weeks or even months. Dealing with the myriad of details while grieving the loss of a loved one can seem overwhelming. An experienced attorney can help to organize, understand and control the process.

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