New York probate court could serve several crucial functions for you, such as settling disputes between inheritors or discerning the intention of will authors. However, you may find it in your best interest to avoid probate altogether: This is often the preference of individuals with high net worth who expect to leave a large estate behind. Avoiding probate in these cases might hasten the disbursement of property from your estate to your beneficiaries. It may also help you circumvent court fees, professional service costs and even reduce tax.
To this end, you might consider establishing a living trust. The first step to understanding the function of trusts— a unique form of property ownership— is identifying the people involved.
According to the United States Department of the Treasury, the three necessary positions in any given trust you might establish are:
- The creator of the trust, typically called a grantor
- The manager or managers of the trust, also known as trustees
- Those who benefit from or who are paid by the trust: the beneficiaries
You might hear different terms for these positions, but, regardless of the terminology used, these three essential functions form the basis of trusts. Basically, you would fund an account with property to be managed by specified or court-appointed individuals, creating a trust. Your trust managers then execute the terms of the trust by passing the property on to the beneficiaries.
The peculiarity of many living trusts is that you could be both the creator and beneficiary of the trust. In addition, living— or inter vivos— trusts are often revocable, meaning that you could dissolve one almost any time you choose to do so. There is one final note about living trusts you might find suited to estate planning: One might name another beneficiary to receive the property of the trust after the initial beneficiary passes. Since this happens outside of your will— as opposed to a testamentary trust, which your executors would enact upon your passing— this transfer of property would usually not require the opinion of a probate court. Please view this article as educational material, not as legal advice.