Many people believe that if you have a will then there is no need for probate if you live in Kentucky. That is not true. Even if you have a will, your estate may be subject to probate. Here’s an overview of what type of estates are subject to probate in Kentucky.
What is Probate?
Probate is a process through which a person’s estate is settled after the person dies. Probate court supervises the distribution of assets to creditors, heirs, and/or beneficiaries.
Which Estates Go Through Probate in Kentucky?
Typically, those estates with greater than $15,000 in probate assets will be subject to probate. So what kind of assets are probate assets? Generally, any assets held in an individual’s name only are subject to probate. Simply having a will does not control whether an estate must be administered through the probate courts. The amount of assets a person has and how they are titled determine whether probate is required.
Understand that a will does many things: Through a will, you can appoint a guardian to care for your children, outline funeral arrangements, or set up trusts for disabled persons to receive assets. But, even though you may have a will, it is not always the case that having a will is adequate enough to avoid probate.
What matters is the size of your estate – how much it is worth – and how each asset is titled. So, one of the first steps that a law firm focused on estate planning must take when evaluating whether probate is required is ask:
- What assets did the deceased have?
- Where are they located?
- How are these assets titled? Are they individually or jointly owned?
Which Kentucky Estates Do Not Go Through Probate?
Some estates do not go through probate because they fall under a certain threshold. As mentioned above, estates with less than $15,000 qualify as small estates and exempt from the full process. When estates exceed this threshold, they may still avoid probate if they have certain assets that are not subject to probate. These assets include:
- Joint tenancies – the surviving joint tenant becomes the automatic owner;
- Tenancy by the entirety – the surviving spouse becomes the automatic sole owner;
- Beneficiary designations – the beneficiaries of retirement accounts and life insurance policies are entitled to the assets upon the death of the account holder or policyholder;
- Payable/transfer on death accounts (POD or TOD) – designated beneficiaries, if there are any, are entitled to bank and brokerage accounts upon the death of the account holder; and
- Assets held in a revocable living trust – if you have funded a revocable living trust then those assets held in that trust are not subject to probate.
Why It May Be A Good Idea to Open Probate Either Way
Even though a person’s estate have no probate assets – for example, everything was jointly owned – it still may be a good idea to consider opening probate in Kentucky.
Why? Because Kentucky has no time limit or statute of limitation on creditor’s claims. Creditors can appear years after a person died and attempt to collect on assets that may have belonged to the estate. However, if probate is filed and an estate is opened, creditors have six (6) months from the appointment of the executor or administrator in which to file a claim. After that six month period has run, creditors are generally barred forever.