You may find that most of your estate consists of non-probate property. Therefore, it is extremely important to coordinate the beneficiaries of all these properties to make certain your assets will be distributed as you want when you pass away.

There are a number of different kinds of properties that may pass outside the provisions of your Will.

The list includes life insurance, retirement plans, individual retirement accounts, and annuities. When you purchased or set up these types of assets and accounts, you were probably asked to fill out a form listing the beneficiaries who will receive payments upon your death. These investments will pass to the named beneficiaries regardless of whether you have a Will. However, if you don't have a beneficiary named, if the beneficiary named is your "estate," or if all the beneficiaries are dead, then those investments will be paid to your estate and pass under your Will.

Certain bank and brokerage accounts will also pass outside your Will. For instance, payable-on-death accounts (sometimes called "POD" accounts) will be distributed to the named beneficiary. Additionally, accounts set up by one or more persons as joint tenants with rights of survivorship will pass to the surviving account holder or holders.

Some banks allow you to set up what they call trust accounts even though there is no written trust agreement. These types of accounts will pass to a named beneficiary without going through probate as well.

Not all joint accounts pass to the survivor. When joint accounts are set up as tenants in common, the portion of the account that was owned by the decedent passes under his or her Will.

Many people have decided to create revocable or irrevocable trusts as part of their estate plan. Virtually all such trusts are designed to pass directly to persons or other trusts named in the document rather than under a Will.

One more thing: Not all Wills need to be probated. You may find that everything your father owns passes directly or automatically to named beneficiaries. If the only assets left are his household goods and other personal items, there is no need to hire a lawyer and go through probate.

There are some steps you must take and other steps you may need to take. Exactly what you must do depends on the types of assets your father owns and the size of his estate.

Find the Will. Locating an original Will can sometimes be difficult. Many people keep their Wills in a safe deposit box, while others keep them at home or some place else. It may be a good idea to talk to your father and find out where his is kept. If it's at the bank, be sure you're authorized to enter the box, otherwise it may be harder to get the Will out.

Hire a Lawyer. Most of the time, it's necessary to hire a lawyer. The judges in some smaller counties allow people to represent themselves in probate matters, but you still may have trouble preparing all the necessary forms that are required. It's safe to say, therefore, that lawyers must be hired in the vast majority of cases.

Application For Probate. The first document your lawyer will prepare is an application for probate. The original Will is filed at the court house along with the application and a filing fee. The application is usually several pages long, and it describes certain facts about your father, his Will, and his property.

The Probate Hearing. After a ten day mandatory waiting period, a probate hearing will be held. Your lawyer will schedule this hearing for you. Under ideal circumstances, you can get your hearing two weeks after the application is filed. However, it often takes three weeks or longer to schedule a hearing because of the backlog in the courts and other scheduling conflicts. In larger counties, the hearings are held in a crowded courtroom, and dozens of cases are heard one after another. In smaller counties, the hearings are often less formal, with the judge often shaking your hand at the door to his or her office, and then showing you to a chair right there in the office.

Testimony and Order. At the hearing, your lawyer will ask you a number of routine questions. Most of the time, the judge will then sign an order admitting the Will to probate. The order is a document which your lawyer will have prepared and brought to the hearing. You will also be asked to sign the written document containing your testimony.

The Oath. After the hearing, you will need to sign an oath stating that you will fulfill your duties as independent executrix of your father's estate. The word "independent" means that you will not need to ask the court for permission to sell estate assets or to conduct any other duties as executrix.

Letters Testamentary. After your oath is filed, you will be able to order "letters testamentary" from the county clerk. The letters will authorize you to close bank accounts and collect and claim other estate assets. You can order as many letters as you think you will need.

Notices. Within 30 days of receiving letters testamentary, you must publish a "notice to creditors" in a local newspaper. This notice lets creditors of your father's estate know where they may file claims to recover money they are owed. It must be published even if your father has no creditors. Certified letters must also be sent to all of the charities named in your father's Will. Proof that you performed these tasks must be filed with the court as well.

File the Inventory. Within 90 days of qualifying as executrix, you must file an Inventory with the court. The Inventory lists all the assets which pass under your father's Will. (Note, though, that is now often possible to file an Affidavit in Lieu of Inventory with the court rather than filing the Inventory.) Importantly, the inventory doesn't always list everything a person owns, since you don't have to list assets that pass directly to named beneficiaries. For instance, life insurance, retirement plans, some joint accounts, and many other properties are designed to pass directly to a named beneficiary. After the Inventory is filed, the judge will sign an order approving the Inventory.

Tax Returns. Estates valued at over $5,430,000 must file a federal estate tax return and a Texas inheritance tax return within nine months of death. Taxes will be owed if the net estate exceeds that amount. The tax rate on assets over $5,430,000 is 40%. You may also be required to file income tax returns for the estate. Often, the lawyer handling the estate will also prepare the estate and inheritance tax returns. However, few lawyers prepare income tax returns.

In answering your question, I have assumed your father's Will was executed, witnessed and notarized properly, and that it contains all the right language. Not all probate proceedings are as easy as this answer indicates. For instance, you may find yourself in the middle of a Will contest, or your father's Will may have been written in another state, thus complicating the probate.

The best place is probably in a safe deposit box because it will protect the documents from theft, fire, accidental loss, and most other types of damage or harm. A potential problem, though, is getting it opened after your death.

If you decide to keep your estate planning documents in a safe deposit box, consider naming a family member or your executor or trustee as a joint holder on the box. That should simplify matters following your death because someone will be able to get into the box without delay. Also, if you live in a flood zone, be sure to put the document in a water-tight plastic bag. As many shocked clients have learned, water damage caused by flooding can ruin the contents of a safe deposit box.

Another place to keep your original estate planning documents is with the attorney who drafted them. However, I have decided not to retain original documents because of concern over theft, fire, flood, storms, or other loss of the document. It would also be prohibitively expensive to store hundreds or thousands of original documents. Also, what would happen if I were to die or my lawfirm were to cease operations?

Many people keep their original estate planning documents at home in a secure place. If you have a safe at home, that can be a good place to keep them. Be aware though, when thieves enter your home and discover a locked safe, they often take the whole safe thinking they'll find cash and jewelry. The last thing they want is a file containing your estate planning documents, but that's one of the things they'll get if you keep them in your safe. Therefore, unless your safe is bolted to the foundation of your house, it may not be the best place to keep your originals.

Another option with regard to a Will is to deposit it with the county clerk's office. Taking this approach can be a great idea, except that you need to be sure your records at home clearly indicate where the original can be found. Moving to a different county or changing your Will can cause problems as well.

More people than you would expect keep original Wills and other estate planning documents in an air-tight plastic bag at the bottom of their freezers. Freezers are well insulated and heavy, and have a way of withstanding fires, hurricanes, and tornadoes. Also, they don't die or move away, and they are stolen far less frequently than in-home safes.

There are some exceptions to the statements contained in this answer. For instance, Bypass Trusts are not always created at death. Some wealthy people create them during life, and other people use their estate tax exemptions for different purposes rather than the creation of a Bypass Trust. Also, in answering your question, I have assumed that when you said "Living Trust," you meant the standard type of revocable trust people across the country regularly create and not another unusual type of trust which may be created while someone is living.

A Living Trust is a revocable trust created while a person is alive, whereas a Bypass Trust is typically an irrevocable trust created at death. A Bypass Trust can be created by a Living Trust or by a Will. (Yes, a Living Trust can create a Bypass Trust, but a Bypass Trust would never create a Living Trust.)

A Living Trust is simply an ownership arrangement where property is held in the name of a "trustee" rather than in the name of the person who really owns the property. People almost always create Living Trusts for their own benefit, with the goals of avoiding probate, addressing the possibility of future incapacity, and keeping matters private.

Normally, the person who creates a Living Trust names himself or herself as trustee and as beneficiary. Upon that person's death, all or a portion of the property which remains in the Living Trust passes according to the terms specified in the trust agreement.

Bypass Trusts are most often created when a husband or wife dies in order to save taxes when the other spouse passes away. When a married person dies and leaves everything to his or her spouse, that surviving spouse may then be too wealthy to pass everything to their beneficiaries tax free. Being "too wealthy" typically means the married couple is worth over $5,000,000. The Bypass Trust is a way to shelter the first spouse's $5,000,000 exemption from taxation when the surviving spouse dies, thereby doubling the amount that can be left tax-free to $10,000,000.

Bypass Trusts do have non-tax benefits though, and for some people, saving taxes is not the motivating factor in creating one. For instance, Bypass Trusts protect the trust property from creditors' claims, and they allow the deceased spouse to direct where the trust property passes when the other spouse dies.

Within a Living Will, it is also possible to name an agent to make medical treatment decisions for you in accordance with your personal wishes if you do not also have a Medical Power of Attorney. Even so, most people go ahead and sign both a Living Will as well as a Medical Power of Attorney, and they do not name an agent within a Living Will.

A Medical Power of Attorney is a document that allows you to name an agent to make medical treatment decisions for you in accordance with your wishes if you are not able to do so yourself.

A Living Will is a document that allows you to address what kind of medical treatment you would like to receive if you ever face a terminal or irreversible medical condition. It is often referred to as the document where you tell the doctors to "pull the plug." Most people request that all treatments other than those needed to keep them comfortable be discontinued or withheld so they can be allowed to die as gently as possible.

The main difference between the two documents is that the Living Will is where you actually express your own specific preferences as to the use of life sustaining treatment, and the Medical Power of Attorney is where you name one or more persons to make most medical decisions for you.