Re real property:
EXAMPLE 1:
Let's say that X buys property in 1994, with a mortgage, and in 1999 he transfers title to "X and Y, joint with rights of survivorship."
X dies in 2000.
That property is still subject to the mortgage on X's death, and Y takes it subject to the mortgage.
EXAMPLE 2:
X buys property in 1994, without a mortgage, and in 1999 he transfers title to "X and Y, joint with rights of survivorship." During 1997, 1998, and 1999 X racks up a ton of credit card debt, which is never reduced to judgment and X dies in 2000.
Y takes the property clear and free of the credit card debt, because at the time of the death of X, the credit card debt was personal to X, and had not attached to the property.
In both cases, the property passes free of probate. While I have never probated a case in a marital property state, in general the probate consists of: (1) non-homestead; (2) non-jointly owned; (3) not owned with a beneficiary designation (i.e., insurance, retirement plans, and annuities).
Avoiding probate is easy, avoiding estate taxes is hard. |
