Estate planning attorneys aren’t the only professionals to advise anyone who is a legal adult and of sound mind to have a will. Financial advisors, CPAs and other professional advisors recognize that without a will, a person places themselves and their family in an unnecessarily difficult position. A recent article titled “One document everyone should have” from the Aiken Standard explains why this document is so important and what else is needed for an estate plan. A will is a “testamentary” document, meaning it becomes operative, only when the person who makes the will (the “testator”) dies.
The process of probate can only begin upon death. Each county or jurisdiction has a probate court — in Virginia, it is the Circuit Court –where the estate assets of deceased individuals are administrated. On the date a person dies, those assets must be identified. Some assets must be used to pay debts, if there are any, and the balance is distributed either according to the directions in the will or, if there is no will or the will has been deemed to be invalid, according to the laws of the state.
All this assumes, by the way, that the decedent did not arrange for his or her assets to pass without probate, by various non-probate transfer methods. For example, there is no probate required, if there is a surviving joint owner or designated beneficiary. One of the best ways to avoind probate is with a fully-funded living trust.
When there is no will and assets are subject to probate, then such assets are passed by intestacy, which usually means they are distributed along the lines of kinship. This may not always be the desired outcome, but with no will, the law controls asset distribution.
Why is a will important?
- It allows you to leave specific property to specific loved ones, friends, or charities.
- It may be used to provide funeral and burial instructions, although they can also be provided in a different document, so they are available to family or friends immediately.
- A will can direct how you want assets to be used to pay debts, any taxes and payment of estate administration expenses, which include the cost of probate, legal fees and executor fees.
- A will can be used to minimize estate taxes, which may be levied not just by the federal government but also by the state.
- The will names the estate’s executor and the extent of his or her powers.
- If there are minor children, the will is used to name a guardian to raise the children.
- If you would like to disinherit any relative, the will provides the means to doing so.
Everyone needs a will, regardless of how large or small their personal assets may be. Every adult should also have an estate plan that includes other important documents, like a Power of Attorney to name another individual to act on your behalf, if you are unable to do so because of an injury or illness. A Healthcare Directive including a Living Will are also important, so those who love you can follow your end of life care wishes.
Reference: Aiken Standard (March 13,2021) “One document everyone should have”