Distribution of Assets

Oakland County Estate Planning Attorney

In the financial realm, an asset is an economic resource. It can be anything tangible or intangible that is capable of being owned or controlled to produce value. Assets are held to have a positive economic value and are therefore considered "an asset."

Assets represent value of ownership and they are things that can be converted into cash and they can put money in your pocket. Assets include a variety of items such as a home, real property, jewelry, fine art, collectibles, investments, automobiles, life insurance policies, buildings, equipment, furniture and personal belongings. The total of your assets make up your estate, which is comprised of everything that you own including money held in bank accounts.

When you die, your assets will need to be transferred to your beneficiaries. The easiest way to distribute your assets is to create an estate plan with the assistance of a qualified Oakland County estate planning attorney. With an estate plan in place, you get to decide who gets what and when, and not the state.

When people die without a will, this is referred to as dying intestate. If you die without a will or a trust in place, then your hard-earned assets will be distributed according to Michigan's intestate succession laws. While these laws are designed with an ideal family structure in mind, they certainly do not reflect all families and don't take into account situations where a parent may have ex-communicated a son or daughter or when a grandparent may want to provide for a grandchild.

Understanding How Assets are Distributed

When people die without a will, their assets are passed down to their closest relatives under the state's intestate succession laws. However, only those assets which would have passed through a will are affected by intestate succession laws. These generally include assets that the decedent held alone and in their own name. Many valuable assets do not go through a will and therefore are not affected by intestate succession laws, some of which include:

  • Property held in a living trust;
  • Life insurance proceeds;
  • IRAs and other retirement accounts;
  • Payable-on-death bank accounts and securities; and
  • Property the decedent owned with someone else in joint tenancy or tenancy in entirety.

How someone's assets are distributed will depend upon whether or not a will or a trust existed and how title to the property is held. If the property is held in the decedent's name alone and there is a will, then the "probate assets" will have to go through probate in order to transfer title according to the directions set forth in the will.

If there is a trust, then the trust assets will be distributed according to the directions in the trust agreement. Sometimes when the grantor (trust maker) fails to transfer all of their assets to a trust, then both probate administration and trust administration are necessary in order to settle an estate. If there was no will and no trust, then the assets will be distributed according to the state's intestate succession laws.

To learn how to strategize an asset distribution plan that is tailored to meet your specific estate planning goals, contact an Oakland County estate planning lawyer from The Law Offices of Stuart Lee Sherman, PC at (248) 919-8029 today.

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