Underrated Estate Docs

If you die without a Will or more generally speaking without estate planning in place then your assets will be distributed by default state law. This is called dying intestate and assets pass by intestate succession. This process and who inherits varys by state law and your specific circumstance; intestate successor in Washington, DC is controlled by D.C. Code § 19-301 et. seq. and intestate succession in Virginia is controlled by Code of Virginia § 64.2-200.

Often intestate successor does not reflect how an individual would have wanted their assets to pass. For example in Washington, DC if a deceased individual is survived by a spouse and only children of the marriage then the spouse receives two-thirds and the children receive one-third. This could cause a number of complications in particular with minor children inheriting, which requires the court to appoint a guardian of the minor’s inheritance/estate (who often is NOT their parent) and the court will also generally micromanage the minor’s assets. Another example in Washington, DC is if a deceased individual is survived by a spouse (but no children) then one-half goes to the spouse and the decedent’s parents receive the other one-half. Virginia’s law differ from Washington, DC and in both of the above examples the spouse would inherit everything. Intestate succession accounts for many different scenarios, including survived by spouses, children of the marriage, children outside of the marriage, parents, siblings, cousins, etc., and each jurisdiction differs as to exactly how and to whom the assets will pass. In some cases this could mean assets pass to an unknown second cousin or a family member you otherwise would have disinherited instead of a friend or family member you are close with or even a charity. Although it is impossible to speculate on the decedent’s wishes, it is doubtful that intestate succession is the inheritance structure they would have wanted the majority of the time.

A property drafted estate plan will ensure your assets pass in the manner you wish and also ensure the entire process is as simple as possible for your loved ones and fiduciaries. If you are interested in discussing an estate plan please contact us for a consultation.  

Updating Estate Documents

A common questions clients ask me after their estate plan has been finalized and signed is “How often do I need to update my plan?”. While there is no simple answer to this question as it all depends on life changes and your circumstances, I do always provide the following general guidelines:

1.     At a minimum I recommend reviewing your plan at least every 3-5 years (annually is ideal, but I want to give a realistic goal). This does not mean you have to review the plan with your attorney – simply take a look at your documents to confirm there have been no major changes in your life, the lives of the beneficiaries, or the lives of the fiduciaries that necessitate a change and also to confirm the documents still reflect your wishes.

2.     Always review your documents if there are any major life changes, such a marriage, divorce, birth, death, retirement, increase (or decrease) in wealth, obtaining new assets or selling assets (in particular real estate), and moving jurisdictions. It is not necessary but may be helpful to consult an attorney to confirm if any of these major life changes affect your planning. For my clients this can often be a quick email or short conversation to confirm the plan in place still works, but sometimes it does require a more in-depth conversation to discuss recommended changes and options. Often during this conversation an individual may discover the documents need other tweaks to reflect their current wishes.

3.     Plans drafted before 2020 and especially those drafted before 2010 should be reviewed and likely revised. There have been a number of changes in recent years regarding the SECURE Act (e.g. how retirement accounts are treated) and the federal (and possibly state) estate tax threshold. Although I as an estate planning attorney try to draft documents to account for numerous contingencies and flexibility, major changes in the law can still make your plan less effective or have unintended consequences. A refresh of these plans can help clarify your wishes and ensure your plan works as intended.

If you already have an estate plan in place, but think you might want to make some changes or just want to discuss your current plan with an attorney please contact us for a consultation. We offer a number of services for updating plans, including a complimentary consultation, a flat rate review and consultation, hourly updates, as well as flat rate updates.