What Assets Are Subject to Probate? Asset ownership is the key to determining what assets are subject to probate. As a general rule, only assets that are part of the “probate estate” are subject to probate court proceedings.
a. Nonprobate Assets. It is easier to define the “probate estate” by first explaining what assets are not part of it. Nonprobate assets are those that pass by operation of law or under the terms of a contract:
i. By operation of law. This category includes assets held by two or more persons in joint tenancy (which includes a “right of survivorship”) and property held by married couples as community property with a right of survivorship, as well as accounts and securities held with a beneficiary designation, such as “in trust for” or “payable on death to”, followed by the name of a beneficiary. The laws related to nonprobate transfers are contained generally in NRS 111.700. More specifically, Nevada law permits a landowner to make a “deed upon death”, which is called a “transfer-on-death deed”, a “beneficiary deed”, or a “deed on death”. [NRS 111.655 et seq.] That type of deed is revocable, but if the landowner dies without revoking such a deed, the named beneficiary or beneficiaries will be entitled to the property without probate.
ii. Under the terms of a contract. This includes various contracts that permit the designation of one or more beneficiaries, such as life insurance, retirement accounts (including IRAs, Keogh accounts, and qualified plan benefits), other retirement benefits, annuities, and some buy-sell agreements related to business entities.
iii. Excluded Items. Some assets that would normally be nonprobate assets sometimes become part of the probate estate. This happens if the estate is designated as the beneficiary under a contract, or if the person who would otherwise receive something by operation of law or under a contract files a disclaimer, which is a declaration that they decline to accept the asset(s) that would be distributed to them. Disclaimed assets pass as if the disclaimant were deceased, and if there is no alternate person who takes under that situation, the asset will become part of the probate estate.
b. Probate Estate. The “probate estate” includes all assets not passing by operation of law or under the terms of a contract. In other words, the probate estate consists of assets for which there is no co-owner with a right of survivorship and for which there is no beneficiary designation. Only the probate estate is governed by the decedent’s will (if there is a valid will) or by the laws of intestate succession (as to any assets not distributed pursuant to the terms of a valid will).