Section 633.356 of the Iowa Probate Code sets forth a provision that is often overlooked by the estate planning professionals. The provision sets forth a method to avoid probate of an estate in an item of personal property involved is valued at $25,000.00 or less. For example, a person may die with a house titled in joint tenancy with their spouse and have a life insurance policy to their spouse but have a bank account in their individual name. The house passes to the surviving spouse outside of probate due to the fact that the asset is held in joint tenancy. The life insurance policy passes to the surviving spouse outside of probate by the designation of beneficiary on the policy. However, the fact that the bank account is in the decedent’s individual name requires a probate administration unless the account is under $25,000.00 in which case the Affidavit described in this article will apply.
In order to utilize the affidavit, you must wait until 40 days have elapsed since the date of death. In addition, we recommend that you retain an attorney to prepare the Affidavit on your behalf.
The affidavit can be used to receive any item of tangible personal property owned by the decedent. It can even be used to collect proceeds from a life insurance policy where no beneficiary has been designated.
If a decedent dies with a Will, the beneficiaries under the Will are the appropriate parties to sign the Affidavit. If the decedent died without a Will, the persons who will succeed to the decedent’s property under the laws of the intestate succession, will be the appropriate parties to sign the Affidavit. If the decedent dies with a Will, a copy of the Will needs to be attached to the Affidavit. Also, a certified copy of the decedent’s death certificate must be attached to the Affidavit.
The Code Section also sets forth provisions allowing recovery of attorney fees in the event that the party holding there property is unwilling to turn the property over pursuant to the Affidavit.
The procedure is a great tool to use to avoid probate under the proper circumstances. Please contact our office to discuss whether the Affidavit is appropriate for your situation.
– By James D. Beatty