Wills and Intestacy
A will allows the
testator (the person creating the will) to specify:
• Who
receives property at the testator’s death.
• Whether
beneficiaries receive gifts outright or in trust.
• Who
will act as personal representative.
• Who
will be the guardian of minor children.
In the absence of a will, these matters are
settled by state law.
Who Needs a Will?
• Include persons who are not heirs. Wills
are needed to provide for a person who is not an heir under state law—unmarried
partners, stepchildren, friends, charities, in-laws, etc.
• Exclude an heir. Heirs are the persons
who inherit an estate under state law in the absence of a will. A will is
needed to prevent an heir from inheriting probate assets.
• Minors and disabled adults. Trust
provisions can be included in a will to delay receipt of an inheritance or to
allow assets to be used on behalf of an adult who is disabled.
• Estate tax planning. Married couples can
include trust provisions to reduce estate tax.
Dying Intestate—Without a Will
State law
determines who receives probate property if a decedent dies without a will.
• Most
states provide first for the surviving spouse and children. Children of the
decedent always inherit a
Children also receive a share in
some states if the surviving spouse has any children who are not also children
of the decedent.
• Intestacy
laws generally provide for distribution by representation, also known as per
stirpes distribution. The share of any heir who dies before the decedent passes
in equal shares to that heir’s children.
• When
there are no descendants, the surviving spouse receives the entire estate in
some states but more commonly shares the estate with the decedent’s parents.
• When
there is no spouse and no descendants, parents and siblings share the estate in
some states. In others, parents inherit the entire estate, and siblings inherit
only if there is no surviving parent.
• If
there are no parents or descendants of parents, grandparents generally inherit
next, followed by their descendants.
• The
final beneficiary under intestacy law is the state. Only relations up to a
certain degree inherit under each state’s laws. After that point, the decedent’s
property “escheats” to the state. State laws vary—a third cousin thrice removed
may inherit in one state but a second cousin may be too remotely related to
inherit in another.
For all your Naperville estate planning needs, please contact us at Platinum Financial Associates today.