Articles Tagged with Will

A Living Will is different from a normal Will.   A Will is a common estate planning document that controls the distribution of a person’s property after he or she dies. It is not effective until death. A living will, however, is effective during a person’s lifetime and serves a wholly different purpose.   Also known as an “advance directive” a living will allows a person, in advance, to give written instructions for medical treatment should he or she become terminally ill and be unable to communicate with a physician or family member. Most states have laws authorizing living wills/advance directives. Arizona’s statutes are found at A.R.S. §36-3201, et.seq. A sample Living Will can be found in A.R.S. §36-3262.

Medical care has become so good that life can be extended artificially for long periods. Physicians often opt to extend life where possible, but this may not be what a patient wants. Few of us want our lives to be artificially extended where we are terminally ill with no chance of recovery. Most want to be allowed to die with some dignity.   This is where a living will comes in.

A Living Will provides a means to control the medical procedures provided to you at a time when you cannot speak for yourself.   In most cases, this amounts to a description of what services are not wanted in the event of a terminal illness. Often, people opt for “comfort care” with instructions that they are to be medicated to be free from pain but other life extending procedures such as feeding tubes, blood transfusions, cardio-pulmonary resuscitation and similar services are rejected. In other cases, patients may wish to preserve life as long as possible using current technology. A Living Will can also be drafted with this goal in mind.

If there is no will, does all the decedent’s property go to the State of Arizona? What happens?   This is a question that is asked frequently. Fortunately, in Arizona, property of a decedent rarely goes to the state. Our statutes provide for a wide pool of family members who are potential heirs.

ARS §14-2102 gives preference to a surviving spouse who normally inherits the entire estate provided that any children are the issue of both the decedent and the surviving spouse. Where there are children from a different relationship, the estate is divided between the surviving spouse and the children.

ARS §14-2103 determines what happens if there is no surviving spouse. In that event, a decedent’s estate is distributed as follows:

Probate is the judicial procedure by which a decedent’s estate is handled through the appointment of a Personal Representative (some states use the term “Executor”).   As mentioned in Platt & Westby’s webpage titled “Probate”, a probate is not always required to handle a decedent’s affairs. Many times, the decedent will not leave behind the kinds of property requiring a Probate, or perhaps the decedent utilized a Trust or other estate planning tool that make a Probate unnecessary. However, should you find yourself in the position where Probate is required, this article provides a rough outline for the standard Probate process. In certain cases, summary Probate proceedings are available which are not addressed by this article.

The first step in the Probate process is to determine if there is a Will or not. You will need to gain access to the decedent’s important papers to determine if there is a Will or perhaps the decedent made known to you a copy of his/her Will beforehand.   If for any reason you cannot gain access to the decedent’s important papers, you may have to proceed to file for appointment of a Special Administrator to obtain the permission necessary to search through the decedent’s important papers. The Special Administrator appointment is outside the scope of this article – but a competent Phoenix Probate Attorney can assist with this. See A.R.S. 14-3614 et seq.

After determining whether or not there is a Will, the next step will be to determine if you may proceed with a formal or informal Probate opening. Arizona permits informal or formal proceedings at each of the different stages of a Probate, depending on the needs of the Probate estate, making it a flexible system. Often, you can begin an estate informally. Where the estate is testate (with an original valid Will), you can proceed to file an Application to have the Will Probated. Where the estate is intestate (without a Will) you can also proceed with an informal Application if all the heirs are agreeable to will serve as the Personal Representative.

You’ve heard the saying “You get what you pay for” – usually about the time that you have discovered that the great deal you snagged did not really save you anything because what you purchased did not live up to your expectations. And now you have to spend more money to fix it or replace it. This saying can, all too often, hold true for your ESTATE PLANNING as well. Sometimes the least costly solution is simply not the best solution, nor the most cost-effective. A WILL, for instance, is cheaper than a TRUST, at least in the near term. It costs less to the person obtaining it and, of course, only becomes operative upon you passing. But to make it effective on your passing, especially where you own property that is titled (i.e. real estate), your heirs will have to probate the WILL, have someone appointed as a Personal Representative, pay the costs for filing with the court, administer the PROBATE estate, and possibly pay an attorney to assist them.

On the other hand, a TRUST may cost more up front, but in the long run is often able to leave more to the TRUST beneficiaries because the TRUST does not have to incur the costs associated with PROBATE administration. Further, the TRUST does not need to be submitted to the court to be made effective. Rather, a TRUST becomes operative immediately after you create it, and you can use it as the central mechanism to coordinate your ESTATE PLANNING needs. And, because it becomes effective immediately, management of the TRUST assets is easier during the lifetime of the trustor (the person creating the TRUST) especially where the trustor becomes impaired. In this instance, a successor TRUSTEE takes over without court intervention, and provides a seamless process for management of the TRUST assets for the benefit of the trustor, without resorting to the need for a CONSERVATORSHIP proceeding (another type of PROBATE proceeding which declares a person incompetent and appoints a person called a CONSERVATOR to manage the incompetent person’s property and assets for the benefit of the incompetent person).

TRUSTS have other benefits too. Because you avoid filing PROBATE, your estate plan remains confidential. For many people, this is a very important consideration. Where you have a significant amount of assets, a TRUST can help reduce estate taxes which in turn allows you to leave more of your property to your family, friends and charities.

In Arizona, if a person dies without a will or a trust, their property passes to others by a process known as intestate succession. Arizona Revised Statute § 14-2103 sets forth the order in which a person’s property passes to relatives who aren’t a surviving spouse. If a person has a surviving spouse, property can be divided differently depending on whether a person had children, and whether or not some or all of those children, are children of the surviving spouse and the decedent.

Not all property is subject to intestate division however. Only property that would otherwise have been distributed from a persons will is subject to intestate succession laws. However there are some common assets which would not be subject to intestate succession laws that often surprise people. For example, life insurance proceeds, payable on death accounts, real property with survivorship rights or retirement accounts such as an IRA or 401(k) that designate beneficiaries. These are examples of assets that go to the person named, regardless of whether there is a will or not. So these common examples would not be subject to intestate succession laws.

As mentioned above, the passing of assets varies depending on what the decedent’s family looked like at their death. For instance, Arizona Revised Statute §14-2102 states that if there is a surviving spouse, the surviving spouse is entitled to either the whole estate (if all children are common to the surviving spouse and decedent or if there are no children). However, if there are children not common to the decedent and the surviving spouse, the surviving spouse gets their half of any community property but only half of the decedent’s personal property. And children of the decedent who were not children of the surviving spouse, receive the other half of the decedent’s separate property.

Clients sometimes express a concern that the State of Arizona not end up with their property after they die. This can sometimes happen but it is unusual. ARS §14-2105 provides that the State of Arizona takes only where no other person is qualified to claim an estate.   More frequently, however, the State of Arizona determines who gets your property and who takes care of you—without consultation with you or consideration of your wishes. This can happen in several ways:

  1. If you do not have a Will. Where there is no Will or other estate plan document such as a Living Trust, Arizona law decides who gets your property and who will handle the probate of your estate. Arizona’s Intestate Succession statutes are found at ARS§ 14-2101 et. seq. These statutes determine who gets the property of a decedent if there is no Will or other estate planning document.
  2. If you enter into a marriage. A marriage can partially revoke an estate plan entered into prior to marriage so that a new spouse is not unintentionally disinherited. ARS§ 14-2301