What it is:
Intestate means dying without a.
How it works/Example:
For example, let’s assume that John Doe dies without a
Because John died intestate, the goes to probate court, as do many estates large and small. In this case, a judge has to allow the transfer of John's and property to the sister and brother. This procedure (probate) the door for relatives or third parties to contest the judge's decision or to interpretations (or misinterpretations) of John Doe’s last wishes, both of which can tie up an estate in court for years.
Why it matters:
Dying without a executor, who may or may not have known you, make the distributions. Many states have laws regarding the distribution of assets of people who die intestate. Often, these laws state that spouses inherit the entire , though some cap the value and give excesses to children or other parties.
Many people think they don't need to do any sort of estate planning, and they think that the existence of a simple does the job. However, are simply legal documents that express the decedent's intentions for burial and to whom he or she wishes to pass and property (the ) when he or she dies. In many cases, must also go through the probate process.
Establishing a trust often aids greatly in this situation because it allows a person to transfer legal title of his or her property to another person while they're still alive, potentially saving thousands in probate fees (and ). A trust also gives the trustee (the person acting on behalf of the decedent) the authority to distribute assets immediately to the based on the of the trust. No court is involved, so there are no probate fees and no public record of the value of the . Trusts are not for everyone, however, so it is important to seek proper financial advice.