One of the many aspects of a professionally created estate plan involves employing strategies to…
What Is Ancillary Probate?
Ancillary probate is an additional, simultaneous probate process that’s required when a decedent owned real estate or tangible personal property in another state or states. The laws of a state where property is physically located typically govern what happens to that property when the owner dies—not the laws of the state where the decedent lived at the time of death. An entire additional probate process becomes necessary. This type of situation presents a unique challenge when you’re planning your estate, and for the person who will eventually serve as the executor or personal representative of your estate.
Ancillary probate refers to a probate proceeding that’s required in addition to the primary probate proceeding that takes place in your home state. This secondary probate is necessary because the probate court in the decedent’s home state has no legal jurisdiction over property that’s situated elsewhere. You might live in Pennsylvania, but you own a piece of real estate that’s located at the New Jersey shore. That property can’t be probated in Pennsylvania. Ancillary probate can also apply to tangible personal property such as cars, boats, or airplanes that are registered and titled out of state. Ancillary probate can become necessary if you own livestock or oil, gas, or mineral rights that are attached to real estate located in another state.
How Does Ancillary Probate Work?
The executor of a “domiciliary” probate proceeding—that which takes place in the decedent’s state of residence and where their will has been admitted for probate—will initiate an ancillary probate proceeding when it becomes clear that the estate includes assets that are registered or titled out of state. One of an executor’s first duties is to identify and gather all assets owned by the decedent. Out-of-state property would be discovered at this time. State courts often work cooperatively when ancillary probate becomes necessary. Other state courts will likely accept the “foreign” will more or less automatically when the domiciliary court has done so. Ancillary courts sometimes accept authorizations provided to the executor by the domiciliary court so the executor doesn’t have to go through the dual process of applying for authorization there. Cooperation between states can shorten the ancillary probate proceeding.
Drawbacks of Ancillary Probate
One of the biggest drawbacks of ancillary probate is the added cost of having to administer more than one probate estate, including multiple court fees, accounting fees, and attorneys’ fees. This can happen even if the process is abbreviated somewhat by cooperation between the state courts, and it can deplete the financial reserves of the estate. Your beneficiaries will receive more if you can figure out a way to avoid ancillary probate of your out-of-state property. Another drawback can occur when an estate is intestate—the deceased died without a valid Will and Last Testament. Intestacy laws determine who receives the decedent’s property when there is no will, and the laws of all 50 states and the District of Columbia are somewhat, if slightly, different. It’s possible that the rightful heirs of an intestate estate could be different in the domiciliary state than they are in the state of the ancillary probate proceeding. This would be a major complication.
Can I Avoid Ancillary Probate?
Probate isn’t necessary for any property that’s placed in a living trust, regardless of where that property is located. You can allow property located in your state to pass to your beneficiaries through the probate of your will, then simply title your out-of-state proceeds in the name of your trust. No ancillary probate would be required for these assets. You might also consider retitling property that’s located in other states so you and your desired beneficiary jointly hold ownership with rights of survivorship. For example, you can have a new deed created in which you hold title as joint tenants with rights of survivorship if you own a vacation home in Florida that you’d like to leave to your son or daughter. They would automatically inherit the property at your death without the necessity of probate. Additionally, 28 states recognize special beneficiary deeds that allow real property to be transferred at your death without a probate proceeding. Beneficiaries named on the deeds can take title by recording an affidavit with the county clerk.
- Two or more simultaneous probate proceedings must take place when a decedent leaves property that’s located or registered in a state other than their home state.
- The “domiciliary” state where the decedent passed would have no legal jurisdiction or right to transfer property located elsewhere to beneficiaries, so an additional ancillary probate proceeding must be opened.
- State courts often cooperate with each other to make this dual process as easy as possible, but ancillary probate can nonetheless increase the costs of settling the estate and leave less for beneficiaries.
- Ancillary probate can be avoided by titling out-of-state property in such a way that it can pass directly to beneficiaries without necessity of probate.
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