When you create a trust in Virginia, you may want to continue transferring assets into it throughout your life to make sure they go to your beneficiaries directly upon your death rather than going through probate. However, death is not known for waiting until someone’s business is satisfactorily completed. If an unexpected death occurs, there could be assets that you have not yet transferred.
At Patel & Dalrymple, PLLC, we often advise clients on the benefits of a pour-over will.
The purpose of a pour-over will
A will names an executor and outlines how he or she should distribute the assets to beneficiaries. The Cornell University Law School’s Legal Information Institute explains that a pour-over will does this, too. But, instead of distributing the assets to your beneficiaries, it passes them to the trust. So, even though you may not have officially placed an asset in trust, your pour-over will does it for you.
The probate process
Maybe one of the reasons you chose to create a trust is to avoid having your assets go through probate before your beneficiaries can receive them. While all the assets already in the trust are not affected by probate, those transferred by the pour-over will do have to go through the process first. After the executor of your estate finishes paying your debts and taxes and settling your estate, he or she can make the transfer, and then the assets are available to your trustee to manage in the way you designated.
Other estate planning tools may complement trusts and pour-over wills. For more information about important end-of-life documents, please visit our webpage.