06/29/2015

Ancillary Probate

Have a time share or vacation property in another state?  Own rental property in another state?  You should be thinking about “ancillary probate”.  A Will is normally probated in the state where the decedent lived at the time of death.  However, if the decedent had real property in another state, the estate will require ancillary probate in the state where the property is located.  The reason is that transfer of real estate is always governed by the law of the state in which it’s situated, not the law of the state where the owner lived.

 Probate in a second (or third) state is called “ancillary probate,” and for the executor of the deceased person’s estate, it means time, effort and expense, and usually finding an attorney in the other state to handle the probate.

 Probate begins in the deceased person’s state of residence. This is sometimes called the “domiciliary probate” because it takes place where the deceased person was domiciled; i.e. made a permanent home.  Then the executor needs to open a second probate court case where the out-of-state real estate is located.   

 It is generally desirable to save your family the expense and effort of an ancillary probate court proceeding after your death, and there are several options, depending on state law, including: 

  • Owning the property with someone else in joint tenancy, tenancy by the entirety, or community property with right of survivorship.  This action delays the ancillary probate until the surviving joint owner dies.  It is a frequent consideration for one or both parents to add a child to the deed, but there are serious gift tax and creditor issues that should be explored.
  • Recording a transfer on death deed for the property.  This was a recent subject for the newsletter.
  • Putting the property in a revocable living trust.  A property owner transfers ownership interest in property to the trustees of the trust, moving it out of the sole name of the owner.

Dominion Law Group --  Leesburg Estate Planners