Probate is a legal process that everyone has heard of but few people actually understand. Colorado residents may know that it has something to do with a person’s death and how that person’s money and property are distributed among the person’s heirs. These basic facts are generally true, but there is a lot more to probate that people should know, so they can make good choices about how to prepare their estate to avoid it.
When a person owns property, they can do so on their own or they may share that property with others. For example, spouses may both have their names on the titles to their cars or two people may jointly own a bank account out of which either may draw funds. When property is owned by two or more people, it generally remains the property of the survivors when one of those individuals dies. Property that automatically transfers to another person upon a person’s death does not have to go through probate.
However, property that does not have an automatic process for transferring ownership must go through probate. If the process is uncontested then the executor of the estate will undertake a detailed inventory of the decedent’s assets and liabilities, will pay any taxes or obligations that the decedent left outstanding, and will manage the transfer of the decedent’s property. If the process is challenged, then the executor will also have to settle disputes concerning the estate.
Disputes can make the probate process drag out, and the longer it takes the more it can cost. Individuals can implement useful estate planning strategies to avoid the probate process. This way, they can protect their wealth and establish their wishes for what happens with their estate when they pass on.