When planning for the future, there are things you don’t want to think about like death. Unfortunately, this is part of life, and decisions must be made as to where assets and property will go.
Your estate is everything you own, including bank accounts, homes and personal belongings. An estate plan is a plan created to acknowledge where property and belongings go. This differs from writing a will in that a will determines where things go when you are deceased. Estate plans vary from state to state, so it’s important to know state laws for your state or if you decide to move to another.
Differences in Estate Planning
Some states won’t accept certain kinds of estate plans. For instance, Florida won’t accept a handwritten or oral estate plan, and they have certain extra requirements for foreign and homestead estate plans. When writing a will in Michigan, estates below a certain evaluation may avoid probate without a trust. A number of states including Nebraska, Iowa, and Pennsylvania have inheritance taxes and some have estate taxes on top of inheritance taxes.
If an estate plan is valid in one state, it is generally valid in others. There are some differences that some states have. Marital property rules, for example, vary by state. If you move from a common-law property to a community property state, the laws change.
The laws on executors vary also. Some states require an individual to be related either by marriage or blood. A state may allow an out-of-state executor but impose certain extra requirements.
If You Don’t Have an Estate Plan
You are not required to have an estate plan, but the consequences aren’t good. If you don’t designate what will happen to your property and personal belongings, the government (which is well known for its ability to handle money) will decide by their terms who gets what. They will also designate the court to determine what happens to any minor children you may have and what they will get. They will appoint a court representative to handle your minor children’s finances, as well.
Deciding what to do with everything you own can be a daunting task, but it is something everyone should do so that the state doesn’t take over. Their laws, for instance, may state that someone receive property that you know shouldn’t be in control of. People trying to get their financial houses in order can create stress among families. It is best to hire a professional estate planning attorney to help ease the burden. They will walk you through step by step and guide you on what is best for you and your family, and you’ll breathe a bit easier.