If you own assets in your name alone, they may pass from you to the people you love, as long as you leave a will. Without a will, your assets pass according to the rules according to the Commonwealth of Virginia, also known as intestacy.
Does a will bypass the courts and the probate process?
No, actually, it is quite the opposite. A will is a “ticket to probate,” meaning that upon your passing, your will is submitted to the Circuit Court where you resided before your death to be proved and recorded. An executor or administrator will be named (typically the person you list in your will), and your assets and personal property will be distributed in accordance with your will. It is important that your will is clear and up-to-date; otherwise, someone could contest the validity of the will, which can be extremely costly for your estate, and ultimately results in your loved ones getting much less than you intended.
If I have a will, does everything pass through it to be distributed to my loved ones?
No, not everything passes through a will. In fact, many things pass outside of the will, including you payable on death (POD) or transfer on death (TOD) accounts, life insurance policies, and anything you own jointly with someone else where there is a right of survivorship or anything you own in a tenancy by the entirety. For instance, if you and your spouse are both joint owners of a bank account, upon your death, your bank account will simply pass to your spouse, and never passes through your will.
If I have a clearly written, up-to-date will, am I “all set”?
Maybe…and maybe not. It depends entirely upon your situation, but in most cases, a will by itself is not sufficient to completely protect your family from the unforeseen. You should know that . . .
- You can reduce your estate tax liability by using a trust in a will.
- If you have a young child who may inherit from you, creating a trust in your will can significantly reduce the attorney’s fees, court costs, and time required to appoint a proper Conservator for your child’s inheritance.
- Creating a trust in your will can protect your designees from creditors, divorce, or becoming disqualified from state and federal benefits (this includes college loans).
- You can protect disabled beneficiaries by creating a supplemental needs trust for them, which preserves assets for the family, while keeping their eligibility for public benefits.