and generally will be subject to the U.S. Federal estate tax. For this reason, a trust vehicle often is used to own the life insurance policy. The trust must be irrevocable to avoid taxation of the life insurance proceeds, and it typically called an irrevocable life insurance trust (or ILIT). Probate Countries whose legal systems evolved from the British common law system, like the United States, typically use the probate system for distributing property at death. Probate is a process where the decedent's purported will, if any, is entered in court, after hearing evidence from the representative of the estate, the court decides if the will is valid, a personal representative is appointed by the court as a fiduciary to gather and take control of the estate's assets, known and unknown creditors are notified (through direct notice or publication in the media) to file any claims against the estate, claims are paid out (if funds remain) in the order or priority governed by state statute, remaining funds are distributed to beneficiaries named in the will, or heirs (next-of-kin) if there is no will, and the probate judge closes out the estate. Probate avoidance Due to the time and expenses associated with the traditional probate process, modern estate planners frequently counsel clients to enact probate avoidance strategies. Some common probate-avoidance strategies include: revocable living trusts (sometimes called revocable inter vivos trusts), joint ownership of assets and naming death beneficiaries, making lifetime gifts, and purchasing life insurance. If a revocable living trust is used as a part of an estate plan, the key to probate avoidance is ensuring that the living trust is "funded" during the lifetime of the person establishing the trust. After executing a trust agreement, the settlor should ensure that all assets are properly re-registered in the name of the living trust. If assets (especially higher value assets and real estate) remain outside of a trust, then a probate proceeding may be necessary to transfer the asset to the trust upon the death of the testator. Designation of a beneficiary Although legal restrictions may apply, it is broadly possible to convey property outside of probate, through such tools as a living trust, forms of joint property ownership that include a right of survivorship, payable on death account, or beneficiary designation on a financial account or insurance policy. Beneficiary designations are considered distributions under the law of contracts and cannot