.2304131300428.jpg)
If a person passes away without a valid last will and testament, they die “intestate.” In such cases, their property would be distributed in accordance with Michigan law — this may not always reflect a decedent’s wishes. Importantly, you can avoid intestate succession and the unintended consequences that can come with it by creating a comprehensive estate plan.
Michigan Intestate Succession
In Michigan, state law will control what happens to your assets during intestate succession. Property will go to your legal heirs and not necessarily the people that you want. If you are married, you might assume that your property will automatically pass on to your spouse, but this is not always the case. Who receives your assets will depend upon which of your close relatives are living at the time of your death.
For instance, if you pass away with a spouse and children, your spouse will inherit their intestate share of $150,000 and 50% of the remaining estate; your children would inherit the other half. In the event both your spouse and parents survive you, your spouse would receive their share, plus three-quarters of the balance with the remaining assets being distributed to your parents. If you have children but no spouse, your children would inherit everything.
Notably, while intestate succession will occur if you pass away without a will, you would also be considered to have passed intestate if your will was not valid. In other words, if the will did not comply with state law or it was successfully challenged because it was procured under duress or undue influence, the same intestacy rules would apply.
Issues Arising from Dying Without an Estate Plan
There are a number of vital issues that can arise from dying intestate. In addition to having no control over who would receive your assets, intestate succession also means that there would be no one designated for administering your estate or making funeral arrangements. Michigan law would apply to designate a funeral representative as well as an executor to distribute your property. The individuals chosen may not be the individuals that you would want to serve in these roles.
Other crucial questions that can arise if you pass away intestate can include who will raise your children and what will happen to your business. If you fail to specify a guardian in a will for minor children or have a plan in place that determines who will run your business after you die, the court will be required to make these decisions. This can potentially result in outcomes you did not intend.
Additionally, situations involving blended families can be particularly complex. If you have been married multiple times and pass away without a valid will, your children from each marriage may not receive the assets you would have wished them to receive. By having a good estate plan, you can help ensure each of your children will be treated as you would want.
Creating an Estate Plan to Avoid Intestate Succession
Critically, you can have control over to whom and how your assets are divided — and when they are passed to your beneficiaries. While a last will and testament can help you avoid intestacy, there are a number of legal tools you can use to tailor your estate plan in accordance with your specific objectives. A comprehensive estate plan may include the following components:
- Last will and testament — A will is the foundation of every estate plan and communicates your final wishes regarding how you would like your assets to be divided. It also designates an executor who will administer your estate.
- Trusts — A trust is a legal arrangement in which a trustee manages your assets and distributes them to the beneficiaries of your choice. There are many different types of trusts that can be used based on your goals.
- Beneficiary designations — A beneficiary designation can allow you to transfer assets directly to the person whom you select, rather than go through probate. Beneficiary designations are often made in connection with retirement accounts, bank accounts, and life insurance policies.
- Joint tenancy with right of survivorship — Joint tenancy is a legal arrangement where two or more parties own property together with equal rights. Upon the passing of one joint tenant, the property would pass to the surviving joint tenants.
It should be noted that a Trust is usually the best and preferred method to pass on assets how you want and to whom you want. In addition, A well-drafted estate plan should also include a plan for incapacity. This would put a strategy in place in the event you suffered from a medical condition and could no longer make healthcare decisions on your own behalf or manage your financial affairs. These things cannot be provided for in a last will and testament since the document only becomes effective upon your passing.
Contact an Experienced Michigan Estate Planning Attorney
Passing away without a will can result in consequences you had not intended for your loved ones. It’s critical to have an estate plan in place to avoid intestate succession and ensure your wishes will be carried out. An estate planning attorney can discuss your specific objectives and help you create an estate plan that will provide you with peace of mind.
The skillful estate planning attorneys at Barron, Rosenberg, Mayoras & Mayoras provide high-quality legal services for a wide variety of estate planning matters. Schedule a consultation today by calling (248) 213-9514 in Michigan or (941) 222-2199 in Florida to learn how we can assist you. You can also use our simple online contact form.