Probate court proceedings (during which a deceased person's assets are transferred to the people who inherit them) can be long, costly, and confusing. It's no wonder so many people take steps to spare their families the hassle. Different states, however, offer different ways to avoid probate. Here are your options in Illinois.
In Illinois, you can make a living trust to avoid probate for virtually any asset you own -- real estate, bank accounts, vehicles, and so on. You need to create a trust document (it's similar to a will), naming someone to take over as trustee after your death (called a successor trustee). Then -- and this is crucial -- you must transfer ownership of your property to yourself as the trustee of the trust. Once all that's done, the property will be controlled by the terms of the trust. At your death, your successor trustee will be able to transfer it to the trust beneficiaries without probate court proceedings.
If you own property jointly with someone else, and this ownership includes the "right of survivorship," then the surviving owner automatically owns the property when the other owner dies. No probate will be necessary to transfer the property, although of course it will take some paperwork to show that title to the property is held solely by the surviving owner.
In Illinois, these forms of joint ownership are available:
In Illinois, you can add a "payable-on-death" (POD) designation to bank accounts such as savings accounts or certificates of deposit. You still control all the money in the account -- your POD beneficiary has no rights to the money, and you can spend it all if you want. At your death, the beneficiary can claim the money directly from the bank, without probate court proceedings.
Illinois lets you register stocks and bonds in transfer-on-death (TOD) form. People commonly hold brokerage accounts this way. If you register an account in TOD (also called beneficiary) form, the beneficiary you name will inherit the account automatically at your death. No probate court proceedings will be necessary; the beneficiary will deal directly with the brokerage company to transfer the account.
Illinois allow you to name a transfer on death (TOD) beneficiary for vehicles registered in the state. There are some restrictions; The vehicle must be owned by only one person, and you can name only one beneficiary. You cannot name a TOD beneficiary if there is a lienholder--for example, a lender who's financing the car. To add, delete, or change a TOD beneficiary, use the form provided by the Illinois Secretary of State.
If you own real estate in Illinois, you can leave it with a transfer-on-death deed, called a Transfer on Death Instrument in Illinois. You sign and record the deed now, but it doesn't take effect until your death. You can revoke the deed or sell the property at any time; the beneficiary you name on the deed has no rights until your death.
Even if you don't do any planning to avoid probate, your estate may qualify for Illinois's simplified "small estate" probate procedures. For more details, see Probate Shortcuts. You can also read about a typical Illinois probate proceeding.