In a lot of situations where a Probate proceeding or Administration is necessary, the major asset of the decedent is their home, or other parcels of real estate. The reason that a Probate or other type of court proceeding is necessary is because when the decedent died, their house and other real estate was in their sole or own name. A Probate proceeding or Administration through the Courts can become complicated, time consuming and financially costly.
These situations may be avoided by gifting a remainder interest in the real estate to one’s heirs or children, while keeping a Life Estate. An outright gift to the heirs or children can also be made, but this can create a need for a Gift Tax Return and can cause possible Cost Basis problems for the people receiving the gift when they sell the property.
Another possibility is to prepare a Quit Claim Deed creating a Joint Tenancy with a Right of Survivorship. These are all possible tools for avoiding Probate, but the owner of the property making the gift could lose their complete control over their home or real property, which in many situations may not be what they desire.