Recent changes that might affect whether you need a will or a trust
Many people, particularly those with spouses or families, wonder whether to do a will or a trust, or either at all. My pages on Wills and Trusts are meant to address very general questions already, but Nevada’s new probate laws may affect your decision, depending on the anticipated value of your estate.
Assembly Bill 130 (AB 130) came into effect on October 1, 2015. This law revises the probate thresholds in Nevada. Probate is the process of introducing and proving the validity of a deceased person’s (or decedent’s) will, settling the affairs and claims of the decedent’s estate, and transferring property pursuant to the will. Nevada has estate thresholds that determine whether probate is necessary and/or what type of court process is required to handle the estate.
The following provides a brief overview of the various probate options aside from general administration and recent applicable changes in law:
No Probate Required - $25,000 or $100,000 estate
Formerly, if the gross value of the decedent’s estate was $20,000.00 or less and included no real estate, then no probate was required to transfer property. AB 130 amended NRS 146.080 to increase the threshold to $25,000.00 or $100,000.00. The $100,000.00 threshold applies to any spouse who is claiming from the decedent’s estate, while the $25,000.00 threshold applies to any other non-spouse claimant. Thus, anyone seeking to claim an inheritance from the estate would present an Affidavit of Entitlement to the person or entity holding the asset for the holder to transfer the property without court filings or intervention.
Note that the gross value of the estate excludes the value of any motor vehicles registered to the decedent.
“Set Aside” without Court Administration – estate up to $100,000
If the net value of the estate is $100,000.00 or less (meaning the gross value after deducting encumbrances), then heirs can petition the court to set aside the estate to distribute it without further court proceedings. Thus, a court filing is required, but court intervention is comparatively minimal. AB 130 did not modify this law (NRS 146.070).
Summary Administration – estate up to $300,000
Formerly, if the net value of the decedent’s estate was $200,000.00 or less (meaning the gross value after deducting encumbrances), then heirs can file a Petition for Summary Administration. AB 130 amended NRS 145.040 to increase the threshold to $300,000.00. Summary administration still requires court filings and supervision, but the process is meant to be quicker with less notice requirements and shorter timelines than general administration. For instance, summary administration does not require publication of a notice of hearing on the initial petition, and creditors only get 60 days to file a claim instead of 90.
In sum, if you want your heirs to avoid going through the probate court altogether, then that would only happen if your gross estate is worth up to $25,000.00 without real estate. Anything beyond that limit will require some form of court filing, though Nevada does try to streamline the process for estates up to $100,000.00. Thus, if you anticipate your estate will be $100,000 or less, I would say a will could work just fine compared to a trust in minimizing the costs and efforts your heirs will have to expend in getting your estate distribute.