Owning a second home, rental property or family property in another state can feel straightforward. Yet after your death, that property could create an added burden for the people handling your estate. You likely want what you worked hard to acquire to pass to your loved ones without unnecessary complications.
Here is what you should know about the probate concerns that can arise and the planning steps that may help.
What is ancillary probate?
Ancillary probate refers to a separate probate proceeding that may apply when you own real property outside your home state. Your primary probate case generally handles your estate, while the state where you own real estate may require its own process.
For example, if you live in California but own a vacation home in Arizona, your family may need to address the Arizona property through Arizona’s legal process after your death. California Probate Code section 12501 recognizes ancillary administration for certain estates involving California property.
Why can out-of-state property complicate an estate?
Out-of-state real estate can create extra work because your family may need to deal with another court system and that state’s procedures. This can mean additional filings, administrative steps and expenses.
If you own property in several states, each jurisdiction may also have its own requirements for transferring real estate after death.
Can a trust help avoid ancillary probate?
A properly established and funded trust can help keep out-of-state real estate outside probate, potentially preventing a separate proceeding for that property. When you place property in a trust during your lifetime, a successor trustee can generally manage or distribute it according to the trust terms after your death.
This can help your family avoid navigating separate probate processes for each property.
Why do trust funding and property title matter?
Creating a trust alone does not automatically place every property under its terms. You generally need to transfer ownership into the trust so the trust can control what happens to the property after your death.
Before relying on your estate plan, review:
- How each property appears in the title records
- Whether each property belongs to your trust
- Whether recent purchases or ownership changes require an update
A review can identify property that your plan does not yet cover and ensure you don’t miss it.
Review your property before your family has to
Ancillary probate can add another layer to a difficult process, but reviewing your property ownership now can help identify problems early. If you own real estate in another state, consider reviewing the title and your estate-planning documents with an attorney to determine whether your current plan addresses the property as you intend.