A pour-over will is a special will that provides that some or all of a person’s assets be transferred to their trust rather than specific beneficiaries or heirs through the probate process. Any assets unaccounted for “pour over” into the person’s trust, helping the estate avoid costly probate. Here is a closer look at what this legal document entails.
How a Pour-Over Will Works
A pour-over will is used in conjunction with a trust. A living trust creates a legal entity that enables the distribution of a person’s assets without being forced into the probate process. A pour-over will names a person’s trust as the beneficiary of the person’s estate.
When a person unintentionally leaves an asset out of their trust or has items that are unaccounted for after their death, the assets will be transferred to the person’s trust according to the pour-over will’s terms. The trustee will distribute the assets as per the terms of the trust. Thus, the planning done in the trust will take effect and be captured by the trust for distribution outside of court.
In Reno, Nevada, if the value of a decedent’s assets exceeds $25,000 or the estate includes real estate assets to be passed on, the estate must go through probate or a shortened version with the probate court. A significant benefit of a pour-over will is it typically eliminates the need for the probate process or makes the procedure more straightforward and streamlined. The benefit is this cost much less and takes less time.
Who Needs a Pour-Over Will?
Ideally, people would not require a pour-over will to capture any assest because they would have accounted for or transferred all their assets before their death to their trust. However, there are times when this does not happen. Probate can be lengthy, expensive, and stressful for loved ones, making most individuals want to avoid it whenever possible. Therefore, a pour-over will is beneficial for most people because it prevents unallocated and untransferred assets from becoming part of a deceased person’s probate estate.
A pour-over will acts as a safety net that captures any unallocated or untransferred assets into a person’s trust. Any person who needs the comfort and peace of mind brought by a pour-over will can have an estate planning attorney draft a living trust and include a pour-over will. The two got together hand-in-hand.
To avoid probate, one can transfer all their qualifying assets to their living trust and properly designate the beneficiaries to get other assets upon the person’s death. A pour-over will acts as a backup that ensures all assets will be controlled by the trust’s distribution terms.
