The Washington Estate Planning Blog

Law Offices of David Ravi Sitlani: Helping couples, families, and individuals understand the ins and outs of estate planning in Washington State.

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Archive for April, 2009

What happens if you die without a Will or a Trust? Part II

Posted by sitlanilaw on April 29, 2009

Sorry for the long delay in posting this second part of this post – again I feel it is important for individuals to understand what happens to their estate if they die without a will or a trust.  The previous post dealt with situations that arise for married individuals while this post will focus on individuals  those who are either not married and/or do not have children.

Situation 1 – The unmarried individual.  As stated in the previous post the State of Washington has a default estate plan in the event you do not make a plan for yourself regardless of the amount of assets you own.

Let us consider Bob, a recently divorced father of 1 minor child.  In this situation we do not need to be concerned about community property since Bob is unmarried and is not in a registered domestic partnership.  If he were to die with a minor child surviving that child would receive his entire estate.

While this would likely match the goals of Bob he should be aware that, when his child turns 18 they will be able to have access to Bob’s entire estate.

This is where planning is crucial – if Bob were to execute either a will or trust he would be able to arrange for his child to receive funds over time and would also be able to provide for his child’s education and other needs.

Situation 2 – What if Bob is unmarried but has no children?  Washington’s default estate plan states that if Bob is single and has no children his estate would go to his parents equally.  If Bob does not have surviving  parents then his estate would go to his siblings, and if he does not have surviving siblings, his estate would go to his surviving grandparents.  The default estate plan continues to provide for other members of Bob’s family to such a degree that it is possible that if Bob died without children, parents, siblings or grandparents – Bob’s estate would go to relatives he never met!

In today’s society we often create families out of friends.  Bob may want to provide for either either a partner or a charity but the default estate plan does not provide a mechanism for this (note – registered domestic partners have the same standing in the default Washington Estate Plan as married couples).

I hope this VERY brief summary of the default estate plan was helpful and provides the reader with some insight on the importance of planning and opting out of the default estate plan!

The above information is a brief overview of the Law of Intestacy in Washington state and is not intended to provide the reader with any legal advice.  Please contact an attorney licensed to practice in Washington state with any legal questions.

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What happens if you die without a Will or a Trust? Part I

Posted by sitlanilaw on April 3, 2009

The easy answer is that if you do not have an estate plan, the state of Washington has one for you!  Put another way, if you die without a will or a trust, your estate will still be subject to the probate court and the court will apply the law of intestacy….So what happens then?  How are your assets distributed?  I’ll go through a couple of illustrations.

Of course more important than assets and money is what happens to minor children if you die without a Will or a Trust.  You can name a guardian for your minor child in the event of your death in your Will – but if you do not have a Will then it is less clear who will become the guardian for your minor child.  While assets and money are important I often find that parents are far more focused on the piece of mind that is provided when they name guardians for their children in their Will.  That being said, it is still important to understand what happens to your assets in the event that you die without a Will or a Trust.

Situation 1:

Spouse 1 is married to Spouse 2.  Together they have two minor children.  Together they own a home as well as some investment assets totaling $1 million- because this was earned during marriage this is deemed to be community property.  While Spouse 1 and Spouse 2 have discussed setting up their estate plan, they have put it off – then suddenly spouse 1 dies.

What happens to the $1 million in community property?

Because all of the property was owned as community property, all of the decedent’s (Spouse 1) share of the community property goes, or passes, to the surviving spouse (Spouse 2).

But what happens if Spouse 1 also had separate property?  First of all, separate property is generally defined as property that is owned by a spouse before marriage OR property that is acquired by a spouse after marriage by gift, bequest, or inheritance.

Situation 2:

So again, Spouse 1 and Spouse 2 have two minor children and $1 million dollars in community property.  However, Spouse 1 also received an inheritance valued at $100,000.  When Spouse 1 dies we know that Spouse 2 will receive all of the community property…but what happens to the separate property?  Because Spouse 1 and Spouse 2 have children, the children will receive one-half of Spouse 1’s separate property, $50,000 or $25,000 each.  Because they are minor children they will likely not have access to this money until they turn 18.  But when they turn 18 they can get the money…and do whatever they want with it!

Is  this a problem?  I assume that depends on the children – it is possible that they use the money wisely – for education or to buy a home.  Of course it is also possible that they do something less prudent with their inheritance.  The important thing to note is that they get the money at age 18!

For those of you who are either not married and/or do not have children it is important to know that the state of Washington also has an estate plan for you!  This will be discussed, along with other issues when I post “What happens if you die without a Will or a Trust?  Part II”.

The above information is a brief overview of the Law of Intestacy in Washington state and is not intended to provide the reader with any legal advice.  Please contact an attorney licensed to practice in Washington state with any legal questions.

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