Probate, Estate and Trust Administration in New Jersey
Serving Families and Individuals in Princeton, NJ and the Surrounding Areas
Probate is a procedure required by the state of New Jersey for all estates formed in the wake of a recent death. Without comprehensive estate planning to avoid probate in New Jersey, survivors of a decedent will have to enter the estate through probate, conduct probate proceedings in full, and then close probate before any assets in the estate can be distributed to heirs as intended.
Processing a will through probate takes time, money, and effort. The appointed administrator of the estate is not allowed to receive guidance from any court employee, so they must rely upon outside legal expertise to help them make the right decisions and manage probate capably.
Van Dyck Law Group can provide you with an experienced New Jersey probate and estate planning lawyer to help you or your loved ones navigate the sometimes frustrating probate process. With careful planning, however, you can avoid probate entirely. Designating assets with a transfer-upon-death title and placing other assets in a living trust can allow these holdings to bypass probate, reducing the burden on loved ones and hastening the time period before a property can be transferred to its intended heirs.
For assistance with probate, estate planning to avoid probate, trust formation, and trust administration, you can trust our highly experienced and locally based attorneys. Speak to us about your goals and learn the steps you could take to reduce the burden of probate during a confidential, no-obligation case review. Call (609) 293-2621 or contact us online to schedule your no-risk appointment today.
What Is Probate in New Jersey?
Probate and estate administration are the processes through which estate assets are transferred after death. When probate avoidance planning has not been implemented prior to death, the state will require a probate court proceeding if the deceased was a resident or owned assets in the state.
Probate can be supervised or unsupervised. In an unsupervised probate, the appointed estate administrator manages assets, pays any debts, files required tax returns and various court documents, and distributes the estate assets. However, the court may at any time require the process to be supervised (usually when someone expresses concern about the estate administration). In a supervised probate, the probate judge must approve every detail of the estate administration.
What Happens During New Jersey Probate Procedures?
The probate procedurally determines whether or not certain obligations need to be met before the assets held in the decedent’s estate are distributed. The most common issues that must be resolved include creditor claims, owed back taxes, and whether or not certain assets truly belong in the estate compared to a trust or automatic property transfer. During probate, reasonable administration costs of the estate will also be paid.
If there are disputes as to the validity of the will or any other forms of contested probate, the court may elect to hold hearings on the matter or (more likely) delay the closure of probate until the matter can be resolved out-of-court through negotiations among the interested parties.
Unlike many other states, New Jersey does not have a uniform probate code in place. This lack of clear state laws that govern probate proceedings could mean different requirements and procedures based on the county in which the probate case is being conducted.
The decision to close probate is a serious one, and administrators or executors may face challenges with determining the validity of creditor claims or will contests. Working with a seasoned New Jersey probate planning team can help an administrator or executor weigh their options carefully while meeting their fiduciary duty to act in the interests of the estate.
New Jersey Probate Avoidance
Because probate can be a lengthy, costly, and public process, many people choose to avoid it. There are a number of legal strategies that will allow you to pass property to another person after death, without that property going through probate.
Joint Tenancy & Tenancy by the Entirety
Adding another person to your assets as a joint owner or “joint tenant with rights of survivorship” will allow your property to pass to them upon your death without going through probate. There are pitfalls to this strategy, however, which include subjecting such assets to any claims (such as lawsuits) against the co-owner and making them available to the co-owner’s creditors — all while you are still alive and planning on using the assets yourself!
Beneficiary Designations
New Jersey allows Transfer on Death (TOD) or Pay on Death (POD) beneficiary designations to be added to bank accounts. Beneficiary designations like these are preferable to joint tenancy in that they allow you to transfer property only upon your death without giving away current ownership.
One of the drawbacks, however, is that it can be difficult to obtain an equitable distribution of property among your heirs by utilizing beneficiary designations. Additionally, understand that if you have beneficiaries listed on your assets, those assets will be distributed upon your death to the listed beneficiaries, even if your last will and testament states otherwise.
Revocable Living Trust.
A Revocable Living Trust is a legal document that allows you to establish a separate entity (the trust) to “hold” legal title to your assets while you are alive, and to name trustees to manage those assets according to the trust terms.
Typically, you serve as the trustee while you are alive, managing your assets for your own benefit. Upon your disability or death, the trust terms appoint your successor trustee who then continues to manage — or distribute — the assets held in trust. A properly drafted trust can accomplish many goals, including guardianship and probate avoidance for your estate and bloodline, marital and creditor protection for your children.
No “Small Estate” Exception in New Jersey
One difference between probate laws in New Jersey compared to other states is that there is no probate exemption for smaller-sized estates. New York, for example, uses an expedited affidavit-based process for estates valued at less than $50,000.
What this means for New Jersey residents planning to avoid probate is that some assets not held in trust or titled with a transfer-upon-death designation will inevitably go through probate. The goal, then, is to plan ahead and restrict the number of assets held in your personal estate as much as possible. This can require careful funding and administration of trusts, with regular updates to the trust’s contents in order to reflect the current holdings of the trust creator.
New Jersey Estate and Trust Administration
Assets contained in a properly drafted and funded trust will generally avoid probate. The trust need not be filed with the probate court. Nonetheless, there are still steps necessary to administer the trust: beneficiaries must be contacted; assets must be gathered, valued, and managed; potential creditors must be notified; debts, taxes, and final expenses must be paid; and, ultimately, any remaining income and assets must be distributed in compliance with the trust terms.
Successor trustees often lack the time, resources, or knowledge to personally administer the trust, and therefore may call upon legal, accounting, and investment professionals for assistance. Oftentimes, a corporate fiduciary (e.g., a trust company) is an excellent alternative to relying solely on busy family members or friends to serve as trustees. We can help your successor trustee(s) deal with the complexities of administering your trust. Please call our office and we will be happy to schedule a consultation, whether or not our office has drafted the original trust.
Get Help With Probate, Planning to Avoid Probate and Administration of a Trust
Very few people willingly spend their time considering factors like probate and whether to put certain assets in a trust, but the plain truth is that this could become critically important in the event of an unexpected passing. By working now to sort through affairs, set intentions for your legal strategies, and arrange for the right legal mechanisms to safely tuck away parts of your estate in a way that avoids probate, individuals can increase the chances that their estate will be easy to manage and their property will be distributed as they see fit.
Reach out to Van Dyck Law Group for legal assistance with any matters involving estate planning, probate, or trust administration. We are available to provide advice and referrals for capable individuals who can help manage your affairs and ensure your assets are held safely where they need to be.
Schedule a confidential consultation with no obligation when you call (609) 293-2621 or contact us online.
