Small Assets Create Big Headaches After Death

The smallest assets can create some of the biggest headaches when someone dies.  We often see cases where the larger assets pass smoothly, such as the house, retirement assets, life insurance, investment accounts and bank accounts.  Then wrinkles appear with smaller assets that have minimal value and yet are difficult and costly to deal with.  Here are some common examples.

Mineral Interests.  Sometimes there is a lack of good record keeping about mineral interests, which can make it difficult to determine what mineral interests are owned.  If you own mineral interests, even if you only receive small royalty payments (or no payments), keep good records of what you own.  In particular, keep deeds, leases and division orders.  In many cases, the family does not know the mineral interest exists, especially if no royalty payments are being received.  The family may open and then close the estate without properly dealing with the minerals.  When they later find out about the minerals, the estate must be re-opened, with added expense.

Out-of-State Property.  If you reside in Colorado but own property in another state, ancillary probate may be required in that other state in order to transfer the property at your death.  Some states have a more efficient process than other states but, in any event, added cost will be required for ancillary probate.  If you own property in other states, there may be options to streamline the transfer of that property at your death.   Even property with minimal value (almost worthless), such as a vacant lot, timeshare or non-producing mineral interests, could require ancillary probate to transfer it.

Timeshares.  Timeshares are notoriously difficult to deal with after death.  Even if no one wants them, they cannot necessarily be abandoned.  So, if you have a timeshare that your family will not want, it is a good idea to explore options to get rid of it during life.  Doing so can be easier said than done, but at least you will be attempting to deal with the problem, rather than leaving the problem for your family.  Alternatively, if your family will want to keep the timeshare, you should take steps to ensure it will pass as smoothly as possible upon your death.

Small Business Interests.  If you own a small business that has minimal value, you may overlook the need to plan for this asset.  If the business needs to be wound up after your death, this could involve closing a bank account, dealing with any other assets in the name of the business, and dissolving the business.  Only someone with proper authority can take these steps. With appropriate planning, you can streamline this process by designating someone to handle these matters after your death.

Our clients often tell us that they want to make everything as easy as possible on their family when they pass away and minimize costs.  One of the steps to help achieve these goals is to make sure all assets, including even the smallest ones, will pass as efficiently as possible upon your death.

The attorneys at Lyons Gaddis are available to assist with your estate planning and administration questions.  Please contact one of our Estate and Trust Attorneys to discuss how we can help.