Question: Why is it important to have a Will and avoid intestacy when an individual owns real estate?
Answer: When a person dies intestate (without a Will), real estate may end up being particularly difficult to deal with if it is an asset of the estate. The various ways of descent in intestacy creates conflicts which would otherwise be easier to manage with a carefully crafted estate plan. State law directs property to be distributed in a manner that the deceased individual (purportedly) would have intended. So if a person dies with a spouse and children, a typical distribution might leave ½ of the property to spouse and ½ to children. So, say a man with 3 children from a prior marriage buys a residence with a woman as tenants in common. He marries the woman then dies intestate. Wife already owns ½ of the property. The other portion of the property passes by intestacy ½ to his wife and ½ to his children. Now his wife owns ¾ of the house and the children own ¼ among them, or 1/12 each. Comment: This plan of distribution is unlikely what this man intended and could cause a problem with children owning fractional interests. It is far better to have a plan — whether that is drawing up a Will or creating a revocable living trust than to leave it to your survivors to figure it out. If you have any questions or would like more information please contact Steve Shane at:email@example.com | 301.575.0313.
ABOUT STEVE SHANE
Steve Shane provides strategic counseling to clients in need of estate administration, charitable giving and business continuity planning while minimizing estate, gift, and generation-skipping transfer tax exposure. He offers legal guidance to clients on asset protection and the proper disposition of assets in accordance with the client’s objectives, while employing tax planning techniques such as the use of irrevocable trusts, life insurance planning, lifetime gifts and charitable trust. He is also experienced with drafting documents for business planning, the incorporation and application for exemption for Private Foundations and the administration of decedents’ estates.
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