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Dealing with out-of-state property in your Colorado estate plan

On Behalf of | Sep 19, 2022 | Estate Planning |

One of the primary goals for people when they create their estate plan is preventing their estate from having to go through a lengthy probate process. A number of estate planning tools and strategies can allow your assets to pass fairly seamlessly to loved ones and other beneficiaries without the involvement of a probate court.

If you own assets in other state at the time of your death, another type of probate – ancillary probate – may be necessary. Ancillary probate is a probate proceeding that occurs in a state outside the decedent’s domicile state. It’s necessary because state probate courts don’t have jurisdiction over assets located in another state.

What’s involved in ancillary probate?

Ancillary probate doesn’t have to be a long, complicated process. Say you have a vacation home in Arizona. You can include that in your Colorado estate plan, but your plan will also have to go through an Arizona probate court. Most probate courts will accept an estate plan without much question if it has been accepted by a probate court in the domicile state.

It’s important to make sure that your executor and anyone else who will need to be involved in the ancillary probate process are willing and able to travel out-of-state if necessary, both for any court matters and to deal with the property.

Ancillary probate is avoidable

Some people choose to sell or gift their out-of-state assets while they’re still around so their loved ones don’t have to deal with them after they’re gone. However, maybe you want to continue to use that vacation home for as long as possible (or eventually move there). You can avoid ancillary probate by including your designated beneficiary on the title. Another option is to set up a revocable living trust in the state where it’s located and include it in that.

It’s a lot to think about, but it doesn’t have to be difficult. If you have experienced legal guidance, you can determine how best to deal with property in another state or even in another country.