Ancillary Probate: When It Is Used, Where It Occurs, and How to Avoid It

Many people own property in more than one state, such as an ocean-side vacation home or a rental property in a former home state. It is important to think about how that property will be handled after you pass away. Through proper estate planning, you can help minimize the burdensome court proceedings your loved ones may otherwise face after your death.

What Is Ancillary Probate?

Probate is the court process that must take place after you pass away to transfer property you owned at your death to the loved ones named in your will (or to heirs designated by state law if you do not have a will). Probate is not required for property titled in a trust or that belongs to a surviving joint owner, such as a joint bank account or marital home jointly owned by you and your spouse that includes rights of survivorship.

When an individual owns real property in more than one state, multiple probate proceedings may be required. As a general rule, the law of the state where the real property is located governs how it will pass to heirs as well as the required court procedures for administering and distributing that property.

• Primary (Domiciliary) Probate: This proceeding is opened in the state where you lived (your domicile) at the time of death.

• Ancillary Probate: This is a secondary proceeding required in any other state where you owned real property to manage and transfer the title to that specific property.

The Procedure

In the primary probate proceeding, the court establishes the validity of the will, admits it into probate, and appoints the executor. Once admitted in the primary state, courts in other states will generally recognize it through the ancillary process. The executor typically files authenticated copies of the primary probate documents with the court in the state where the secondary property is located.

Why People Avoid It

Most people try to avoid ancillary probate because it doubles the disadvantages of standard probate:

• Increased Costs: Additional court fees, accounting fees, and attorney’s fees for each state.

• Delays: A long waiting period before property can be transferred to heirs.

• Lack of Privacy: Multiple sets of public court hearings and records.

How to Avoid Ancillary Probate

Joint Ownership with Survivorship Rights

If you own property jointly with another person, it can automatically pass to the joint owner, avoiding the probate process entirely.

• The Process: The survivor usually completes a few forms and submits them to the appropriate office.

• The Risk: The property becomes subject to the surviving owner’s creditors, divorcing spouse, or bankruptcy.

Transfer-on-Death Deed

In several states, you can use a transfer-on-death (TOD) deed (also known as a beneficiary deed) to name who will receive the property at your death.

• Control: You retain full ownership and can sell or mortgage the property during your life.

• Mechanism: At death, title passes by operation of law, bypassing probate.

• Limitation: It typically offers no creditor protection for the beneficiary once they inherit the property.

Revocable Living Trust

Retitling your out-of-state property into a revocable living trust during your lifetime is one of the most effective ways to avoid ancillary probate.

• Proper Funding: Assets must be transferred or retitled into the trustee’s name before your death to be effective.

• Continuous Control: You serve as trustee during your life, retaining full control.

• Succession: If you become incapacitated or pass away, your successor trustee steps in to manage or distribute assets according to your instructions, all without court involvement.

Make Things Easier for Your Loved Ones

The last thing your grieving loved ones need is a lengthy, expensive, and complicated process to handle your assets. When real estate is located in more than one state, administration can become even more burdensome.

We can help you implement a comprehensive estate plan to minimize administrative friction and reduce the cost and stress for your loved ones. Contact us today to discuss strategies to ensure that your assets pass efficiently to your intended beneficiaries, regardless of where the property is located.