The methods used to make assets Nonprobate Assets fall into two distinct classes, depending on whether or not they can provide an “umbrella” covering a collection of assets. So, for example:
- Examples of “Umbrella” Methods:
- Community Property Agreements.
- Revocable Living Trusts.
- Examples of “Asset-by-Asset” Methods & Nonprobate Assets:
- Joint Tenancies.
- JTWROS Bank Accounts.
- POD Accounts.
- TOD Securities.
- Life Insurance Policies.
- Employee Benefit Plans.
This website employs the term Nonprobate Assets. Traditionally, the term “nonprobate assets” has been used to describe any asset that passes outside of probate. As more fully described in the paragraph Nonprobate Assets That Are Not “Nonprobate Assets” Under Washington Law of the webpage Determining Decedent’s Probate Assets, the Washington legislature has excluded for purposes of the Washington law on abatement and insolvency, life insurance contracts on a Decedent’s life and a Decedent’s employee benefit plans from the definition of Nonprobate Assets, although those two assets continue to pass outside of probate (to the extent that the proceeds are not paid to the Decedent’s estate). Confusing, isn’t it? This website attempts to remedy this confusion by using the term “Nonprobate Assets under Common Law” or “Traditional Nonprobate Assets,” which would include life insurance policies and employee benefit plans.
As an alternative to the term “Nonprobate Assets,” some authors use the term “Will Substitutes.” For our purposes, the terms:
all mean the same thing — namely, either:
such that at death: