Creating an Estate Plan is one of the most important steps you can take to protect your assets and your loved ones. However, many people worry about what happens if they accidentally leave something out. Whether it’s a bank account, real estate, or personal property, it’s important to understand what happens if you forget to include an asset and how it can complicate your Estate Plan. Reach out to an experienced Medina County, Ohio asset protection lawyer to schedule your free consultation today.
What is an Estate Plan?
An Estate Plan is a collection of legal documents and instructions that determine how your assets will be managed and distributed after your death, and how your personal and healthcare decisions will be made if you become incapacitated. It provides security for your loved ones and ensures your wishes are honored.
An Estate Plan typically includes several components. A Last Will and Testament is often important and specifies who receives your property and names a guardian for minor children. A Revocable Living Trust is often used to hold assets, allowing them to bypass Probate and be distributed privately and efficiently.
Besides asset distribution, an effective plan should address potential incapacity. This is accomplished through a Durable Power of Attorney, which appoints an agent to manage your finances if you are unable to, and an Advance Directive (or Living Will) and Healthcare Power of Attorney, which outline your medical treatment preferences and name a representative to make healthcare decisions on your behalf. Other elements can include beneficiary designations on life insurance and retirement accounts, among other things.
What Happens if I Forget to Include an Asset in My Estate Plan in OH?
If an asset is not properly included in your Estate Plan, it is considered an “omitted” or “undistributed” asset. This situation may trigger the Probate process if the asset is solely in your name and doesn’t have a beneficiary designation.
If you have a Last Will and Testament, the forgotten asset will typically be distributed according to the terms of that Will. This is why many trusts are paired with a Pour-Over Will. A Pour-Over Will is a specific type of Will that dictates that any assets remaining outside the Trust at the time of death should be “poured over” into the Trust to be distributed according to its terms. While this ensures your wishes are followed, it requires the omitted asset to go through Probate first, which is the time-consuming and public court process your original Estate Plan was likely designed to avoid.
If you die without a Will (intestate), the omitted assets will be distributed according to Ohio’s laws of intestate succession. These laws determine who inherits based on a hierarchy of surviving relatives, which could be different from your true intentions. The need to subject a forgotten asset to Probate can significantly delay the final settlement of your estate, increase administrative costs, and expose your financial affairs to public record.
For more information and legal advice, contact an attorney at Krause Law today.
