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What
Happens if You Die Without A Will?
If you die
intestate (without a will), your state's laws of descent and distribution will
determine who receives your property by default. These laws vary from state to
state, but typically the distribution would be to your spouse and children, or
if none, to other family members. A state's plan often reflects the
legislature's guess as to how most people would dispose of their estate and
builds in protections for certain beneficiaries, particularly minor children.
That plan may or may not reflect your actual wishes, and some of the built-in
protections may not be necessary in a harmonious family setting. A will allows
you to alter the state's default plan to suit your personal preferences.
What a Will Does
A will provides for
the distribution of property owned by you at the time of your death in any
manner you choose (subject to the forced heirship laws of some states that
prevent disinheriting a spouse and, in some cases, children). Your will cannot,
however, govern the disposition of properties that pass outside your probate
estate (such as certain joint property, life insurance, retirement plans and
employee death benefits) unless they are payable to your estate.
Wills can
be of various degrees of complexity and can be utilized to achieve a wide range
of family and tax objectives. If a will provides for the outright distribution
of assets, it is sometimes characterized as a simple will. If the will
establishes one or more trusts, it is often called a testamentary trust will.
Alternatively, the will may leave probate assets to a preexisting inter vivos
trust (created in your lifetime), in which case it is called a pour over will.
In either case, the purpose of the trust arrangement (as opposed to outright
distribution) is to ensure continued property management and creditor protection
for the surviving family members, to provide for charities, and to minimize
taxes.
Aside
from providing for the intended disposition of your property to spouse, children
etc., there are a number of other important objectives that may be accomplished
in your will.
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You may designate a guardian
for your minor child or children if you have survived the other parent-and,
by judicious use of a trust and appointment of a trustee, eliminate the need
for bonds and supervision by the court regarding the care of each minor
child's estate
-
You may designate an executor
of your estate in your will and eliminate the need for a bond; in some
states the designation of an independent executor will eliminate the need
for court supervision of the settlement of your estate.
-
You may choose to acknowledge
or otherwise provide for a child (e.g., stepchild, godchild, etc.) in whom
you have an interest, an elderly parent, or other individuals.
-
If you are acting as
custodian for the assets of a child or grandchild under the Uniform Gift (or
Transfers) to Minors Act, you may designate your successor custodian and
avoid the expense of a court appointment.
-
Good planning can also
enhance your support of religious, educational, and other charitable causes.
What
A Will Does Not Do
A will does not
govern the transfer of certain types of assets, called nonprobate property,
which by operation of law or contract pass to someone else on your death.
How to
Execute a Will
Wills are
signed in the presence of witnesses and certain formalities must be observed. A
later amendment to a will is called a codicil and must be signed with the same
formalities. In some states, the will may refer to a memorandum disposing of
tangible personal property, such as furniture, jewelry, automobiles, etc., which
may be changed from time to time without the formalities of a will. In many
states, a will that is formally executed with the signatures notarized is deemed
to be self proved and may be admitted to probate without testimony of witnesses
or other additional proof.
One
should consult with a qualified legal professional prior to implementing legal
strategies.
If you
are a tax, insurance, financial or real estate planning professional receiving
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