Assets That Pass Outside of a Will

Assets that pass outside of your will are those assets that are not subject to the terms of your will. Whether you are a Fort Wayne, Indiana area resident, or a resident of another state, you need to consider carefully how you hold title to all of your assets. Only those assets that you own in your individual name without beneficiary designation will pass according to the terms of your will. Similarly, assets that you own with someone else as a tenant in common will also pass through your will. However, assets owned outside of these two categories do not go through probate when you die, but rather they go to your beneficiaries directly.

Assets that pass directly to your beneficiaries may include:

  • Property you own as joint tenants with rights of survivorship with someone else.
  • Life insurance proceeds with named beneficiaries other than your estate.
  • IRAs, retirement plans, and pension plans that are payable to beneficiaries other than your estate.
  • Investment products such as savings, checking and brokerage accounts, and certificates of deposit (CDs) that are payable on death (POD), or transferred on death (TOD) to a designated beneficiary other than your estate.
  • Assets you have placed in a trust do not pass through probate but pass to beneficiaries named in the trust.

Closely held business interests like partnerships and S-corporations are often subject to agreements among the other business owners that may limit your ability to transfer your business interests by will. If these agreements exist, it is important to bring them to the attention of your estate attorney.

If some assets pass under the terms of your will and others by beneficiary designation outside of your will, the final distribution of your estate may become complicated and sometimes disputed by your beneficiaries after your death. You need to consider carefully how you hold title to all of your assets. It is important to consult with an estate attorney to understand these issues and to affect the most appropriate planning and precisely document your wishes.