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Exclusions from an estate plan in North Dakota

On Behalf of | May 17, 2023 | Estate Planning |

Creating an estate plan is an essential step in safeguarding one’s assets and ensuring their distribution according to personal wishes.

However, individuals in North Dakota must be aware of the exclusions that exist within the state’s estate planning laws. These exclusions include certain assets and properties that individuals cannot include in an estate plan. Here are some things that estate planning laws may not allow you to include in your plan.

Assets subject to non-testamentary transfer

When crafting an estate plan, individuals must understand the limitations on including certain assets. North Dakota law designates specific assets as subject to non-testamentary transfer, meaning they pass directly to designated beneficiaries without probate or the control of a will.

Non-assignable property

North Dakota law identifies certain types of property as non-assignable, meaning that individuals cannot include them in an estate plan. For example, if you jointly own real property with survivorship rights, such as joint tenancy with rights of survivorship or tenancy by the entirety, the property automatically passes to the surviving co-owner upon your death.

Life insurance policies with named beneficiaries bypass probate and go directly to the designated beneficiaries. The proceeds from these policies are not distributed through a will or trust, as they already have designated recipients.

Pension plans, 401(k)s, IRAs and other retirement accounts often require the account holder to designate a beneficiary. Upon the account holder’s death, the benefits pass directly to the named beneficiary and are not subject to probate or controlled by a will.

By recognizing these limitations, individuals can develop a comprehensive estate plan that effectively addresses their wishes and ensures a smooth transfer of assets.