How Estate Planning Can Avoid Ancillary Probate for an Arizona Estate
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When an Arizona estate includes out-of-state property, the personal representative of the estate may need to complete ancillary probate in the state where the property is located as part of administering the estate. Fortunately, an Arizona resident who owns out-of-state property can avoid ancillary probate by planning in advance with help from an estate planning attorney. Avoiding ancillary probate saves time and expenses for an estate and has other advantages as well.
Understanding Ancillary Probate
Probate is a statutory, court-supervised process that some estates must complete. Arizona probate laws govern the probate administration process for estates and property located in Arizona. Other states have their own probate laws that govern estates and property located in their states. While probate laws are generally similar from state-to-state, they are not identical.
When an Arizona resident owns property in another state, such as a second home or investment property, the out-of-state property is subject to the probate laws in the state where it is located when the Arizona resident dies. The out-of-state probate process is referred to as ancillary probate, because it is secondary to the primary (or domiciliary) probate in the person’s home state of Arizona, which may be required under Arizona laws.
Ancillary probate usually involves real property, but it can also involve other types of titled property, such as a motor vehicle or livestock. While ancillary probate includes only the property located in the other state, it usually involves additional time and expenses, just as Arizona probate takes time and incurs expenses. If an Arizona resident owns property in multiple other states, there is a potential for multiple ancillary probate processes in the other states.
In addition to being governed by out-of-state probate laws, property owned in another state may be subject to the laws of intestate succession of the other state, if the property owner dies without a will. That means the out-of-state property may be distributed according to different rules than the estate property located in Arizona.
Finally, while Arizona does not have estate or inheritance taxes, some other states do. As such, taxes on out-of-state property in an Arizona estate may need to be addressed as part of ancillary probate.
Avoiding Ancillary Probate for an Arizona Estate
An Arizona resident who owns out-of-state property can avoid ancillary probate by working with a knowledgeable Arizona estate planning attorney. It is important to note that avoiding ancillary probate must be accomplished during the lifetime of the property owner. After the owner dies, it is too late to avoid ancillary probate if state laws require it.
The strategies for avoiding ancillary probate are generally similar to the strategies for avoiding Arizona probate, which is often a separate, important estate planning goal. The approaches for avoiding ancillary probate for an Arizona estate include:
- Placing the out-of-state property in a properly established, executed, and funded trust
- Establishing title to the property as a joint tenancy (ownership by joint tenants) with the right of survivorship
- Using a beneficiary deed or transfer-on-death title, if permitted in the state where the property is located
Which option is most suitable depends on the nature of the owner’s assets and their personal and financial circumstances, which is the reason that professional guidance is important.
Revocable Living Trust
Placing out-of-state property in a revocable living trust is an effective way to avoid ancillary probate. Because property in the trust goes through trust administration, rather than probate administration, using a trust can also save significant time and probate expenses, as well as protect the privacy of the financial details of the estate.
Joint Tenancy with a Right of Survivorship
If property in another state is titled as joint ownership (tenancy) with a right of survivorship, the property passes automatically to the surviving tenant(s) on the death of the Arizona owner. As such, the property bypasses the ancillary probate process in the state where the property is located.
Beneficiary Deed / Transfer-on-Death Title
The State of Arizona allows use of a beneficiary deed in A.R.S. § 33-405. A beneficiary deed is a transfer-on-death (TOD) deed that designates a named beneficiary (or beneficiaries) to assume ownership of the property on the original owner’s death. Arizona also allows transfer-on-death titles for other types of property, including motor vehicles.
Not all states allow beneficiary deeds and transfer-on-death titles. If out-of-state property is in a state that does permit them, this type of deed or title can be used to avoid ancillary probate. However, if property is in a state where beneficiary deeds or TOD titles are not permitted, this approach will not be a way to avoid ancillary probate.
Importance of Legal Counsel
Choosing the right approach for avoiding ancillary probate requires evaluating all relevant factors, including the structure of the owner’s estate plan, the nature of the out-of-state property and the owner’s Arizona property, and their ultimate estate planning goals. For that reason, an Arizona resident who owns out-of-state property and wishes to avoid ancillary probate should seek guidance from an Arizona estate planning attorney.
Ancillary Probate in Arizona
In addition to ancillary probate being a consideration when an Arizona resident owns out-of-state property, ancillary probate also comes into play when an out-of-state resident owns property in Arizona. In the latter case, the Arizona property may be required to go through Arizona probate when the out-of-state owner dies.
An out-of-state owner of Arizona property can avoid ancillary probate using approaches similar to those that an Arizona resident can use to avoid probate in the state. In addition, Arizona real estate owned by an out-of-state resident may be eligible to avoid probate by using the Arizona small estate affidavit process, which is governed by A.R.S. § 14-3971, if the real estate value does not exceed $300,000 (the current threshold in 2026) when the owner dies and other criteria are met.
The appropriate approach in a specific situation depends on the out-of-state owner’s overall circumstances and goals. An out-of-state resident who owns Arizona property should consult with an estate planning attorney in the owner’s home state of residence to address potential ancillary probate issues with Arizona property.
Schedule a Free Consultation with an East Valley Estate Planning Attorney
In our estate planning practice at Peterson Law Offices, PLLC, we help Arizona residents address ancillary probate as part of an overall estate plan. In our Arizona probate practice, our work includes Arizona estates with ancillary probate, as well as out-of-state estates with ancillary probate in Arizona. We welcome you to schedule a free initial consultation by calling 480-878-5998 or using our online contact form.
