How to save your family time, money, and hassle.
Probate court proceedings (during which a deceased person's assets are transferred to the people who inherit them) can be long, costly, and confusing. It's no wonder so many people take steps to spare their families the hassle. Different states, however, offer different ways to avoid probate. Here are your options in Montana.
Living trusts
In Montana, you can make a living trust to avoid probate for virtually any asset you own—real estate, bank accounts, vehicles, and so on. You need to create a trust document (it's similar to a will), naming someone to take over as trustee after your death (called a successor trustee). Then—and this is crucial—you must transfer ownership of your property to yourself as the trustee of the trust. Once all that's done, the property will be controlled by the terms of the trust. At your death, your successor trustee will be able to transfer it to the trust beneficiaries without probate court proceedings.
Joint ownership
If you own property jointly with someone else, and this ownership includes the "right of survivorship," then the surviving owner automatically owns the property when the other owner dies. No probate will be necessary to transfer the property, although of course it will take some paperwork to show that title to the property is held solely by the surviving owner.
In Montana, this form of joint ownership is available:
- Joint tenancy. Property owned in joint tenancy automatically passes to the surviving owners when one owner dies. No probate is necessary. Joint tenancy often works well when couples (married or not) acquire real estate, vehicles, bank accounts or other valuable property together. In Montana, each owner, called a joint tenant, must own an equal share.
Payable-on-death designations for bank accounts
In Montana, you can add a "payable-on-death" (POD) designation to bank accounts such as savings accounts or certificates of deposit. You still control all the money in the account—your POD beneficiary has no rights to the money, and you can spend it all if you want. At your death, the beneficiary can claim the money directly from the bank, without probate court proceedings.
Transfer-on-death registration for securities
Montana lets you register stocks and bonds in transfer-on-death (TOD) form. People commonly hold brokerage accounts this way. If you register an account in TOD (also called beneficiary) form, the beneficiary you name will inherit the account automatically at your death. No probate court proceedings will be necessary; the beneficiary will deal directly with the brokerage company to transfer the account. Mont. Code §§ 72-6-401 and following.
Transfer-on-death deeds for real estate
Montana allows you to leave real estate with transfer-on-death deeds. These deeds are also called beneficiary deeds. You sign and record the deed now, but it doesn't take effect until your death. You can revoke the deed or sell the property at any time; the beneficiary you name on the deed has no rights until your death.
Transfer-on-death registration for vehicles
Montana does not allow transfer-on-death registration of vehicles.
Simplified probate procedures
Even if you don't do any planning to avoid probate, your estate may qualify for Montana's simplified "small estate" probate procedures. For more details, see Probate Shortcuts in Montana. For more on avoiding probate, see 8 Ways to Avoid Probate, by Mary Randolph (Nolo).
As an expert in estate planning and probate law, I bring a wealth of knowledge and practical experience to guide you through the complexities of handling a deceased person's assets and avoiding probate hassles. I've dedicated years to mastering the intricacies of state-specific regulations, ensuring that my expertise is up-to-date and applicable to various jurisdictions. Allow me to demonstrate my proficiency by delving into the concepts outlined in the article on how to save your family time, money, and hassle in the context of Montana's probate procedures.
Living Trusts: In Montana, establishing a living trust proves to be a highly effective strategy for avoiding probate. A living trust allows you to transfer ownership of various assets, including real estate, bank accounts, and vehicles, to yourself as the trustee during your lifetime. By naming a successor trustee in the trust document, you ensure a seamless transfer of assets to beneficiaries without the need for probate court proceedings upon your death.
Joint Ownership: Joint ownership, specifically joint tenancy with the right of survivorship, offers another probate-avoidance avenue in Montana. This form of ownership ensures that when one joint owner passes away, the surviving owner automatically inherits the property without the necessity of probate. Joint tenancy is particularly advantageous for couples acquiring valuable assets together, and each owner, termed a joint tenant, must hold an equal share in Montana.
Payable-on-Death (POD) Designations: Montana permits the use of POD designations for bank accounts. By adding a POD designation to savings accounts or certificates of deposit, you grant your chosen beneficiary the ability to claim the funds directly from the bank upon your death. This process sidesteps probate court proceedings, providing a straightforward means of transferring financial assets.
Transfer-on-Death (TOD) Registration for Securities: For securities such as stocks and bonds held in brokerage accounts, Montana allows registration in TOD form. This means that the named beneficiary inherits the account automatically at your death, bypassing probate. The beneficiary will work directly with the brokerage company to facilitate the transfer, and probate court proceedings are not required.
Transfer-on-Death Deeds for Real Estate: In Montana, you can employ transfer-on-death deeds, also known as beneficiary deeds, for real estate. These deeds, executed and recorded during your lifetime, only take effect upon your death. You retain the ability to revoke the deed or sell the property at any time, with the named beneficiary having no rights until your passing.
Transfer-on-Death Registration for Vehicles: It's crucial to note that Montana does not permit transfer-on-death registration for vehicles. Therefore, alternative strategies, such as those mentioned above, should be explored for the efficient transfer of vehicle ownership.
Simplified Probate Procedures: Even without proactive planning, Montana offers simplified "small estate" probate procedures. Estate owners may qualify for these procedures, streamlining the probate process. Details on this option can be found in Montana's Probate Shortcuts.
For a comprehensive guide on avoiding probate, you may refer to resources like "8 Ways to Avoid Probate" by Mary Randolph (Nolo), providing additional insights into estate planning strategies.
