What Types of Property Transfers by Contract?
The most common types of property that pass from a decedent to other people or entities by contract are: • Life insurance proceeds, annuities, and retirement plan benefits, which pass according to the beneficiary designation given to the insurance company or retirement plan administrator. If no beneficiary is designated or if a designated beneficiary dies before the insured and a contingent beneficiary was not designated with the life insurance company, the life insurance becomes a probate asset. • Trust assets, which are titled in the name of the trustee and that pass according to the instructions to the trustee stated in the trust agreement. Creating a trust to hold assets is one of the most common ways to avoid probate. Assets owned by a trustee for the benefit of named beneficiaries are not probate assets and avoid probate. Example 7 – The Living Trust – Valid Transfer: Jane is unmarried with no children. She creates a trust during her life (a “living trust” or an “inter vivos trus
The most common types of property that pass from a decedent to other people or entities by contract are: • Life insurance proceeds, annuities, and retirement plan benefits, which pass according to the beneficiary designation given to the insurance company or retirement plan administrator. If no beneficiary is designated or if a designated beneficiary dies before the insured and a contingent beneficiary was not designated with the life insurance company, the life insurance becomes a probate asset. • Trust assets, which are titled in the name of the trustee and that pass according to the instructions to the trustee stated in the trust agreement. Creating a trust to hold assets is one of the most common ways to avoid probate. Assets owned by a trustee for the benefit of named beneficiaries are not probate assets and avoid probate. Example 7 – The Living Trust – Valid Transfer: Jane is unmarried with no children. She creates a trust during her life (a “living trust” or an “inter vivos trus
