Understanding Probate « »
CLASSIFICATIONS OF PROPERTY
In the administration of estates, property is classified by the designation of either real property or personal property. Real property is land or those items which are permanently affixed to land (for example, a building). Personal property is that which is not real estate. It includes tangible property (for example, automobiles, furniture, and jewelry) and intangible property (bank deposits and stocks, for example).
Not all property is subject to estate administration. Probate assets are items held in a decedent’s own name which must be included in the administration of an estate (for example, stocks and bonds registered in the decedent’s name). Nonprobate assets are items which transfer automatically from a decedent to another person and are not included in estate administration. Jointly owned property – property which is held in joint ownership by a decedent and some other person (or persons) with a right of survivorship – is not subject to estate administration. The decedent’s interest in such property passes directly to the surviving owner(s). Life insurance proceeds and retirement plan assets payable to a specified person other than the estate also are nonprobate assets. Many nonprobate assets, however, are subject to estate taxes.