King & Wood, P.A.

What to Do When a Spouse Dies

“Unfortunately, during the grieving process surviving spouses also need to navigate the complex financial issues that arise after the death of their partner.”

The death of a spouse is one of life’s most stressful events and is an overwhelming experience. Having to deal with life’s legal and financial aspects while grieving is a challenge, says a recent article, “What To Do After The Death Of A Spouse,” from Forbes. One thing to note: all tasks don’t have to be done at once.

What does need to be done promptly is making funeral arrangements, notifying family and friends and alerting your estate planning attorney. Other immediate steps include:

• Obtaining multiple copies of the death certificate
• Asking a friend or relative to watch the house during the funeral. Burglaries often occur during funerals, when burial plans are public.
• Arrange for any pets to be cared for.

There are a number of things to avoid as well. Letting grief and fear delay important actions can lead to larger estate problems. Don’t neglect to contact Social Security to report the death and monitor tax and other deadlines. Don’t start giving away assets, whatever persistent family members may say. You’ll need to go through the estate process properly. Assets are not distributed until all other tasks have been completed.

Legal and financial documents must be gathered and reviewed, including bank statements, investment accounts, retirement accounts and beneficiary designations, life insurance policies, estate planning documents and outstanding debts or liabilities.

Bills need to be paid. This can become problematic. For example, were the bills paid from joint accounts, your or your spouse’s account? Do you have a list of all accounts? Is it okay to pay a joint bill from your bank account? Do you need to change regularly made payments formerly made from your deceased spouse’s account to your account?

Hopefully, you and your spouse had the right estate planning documents completed beforehand. Next, contact your estate planning attorney to discuss the will and any trusts. Assets owned by your spouse only will likely go through probate. Assets with beneficiary designations, like retirement accounts or life insurance policy proceeds, will go directly to the beneficiaries.

The surviving spouse needs to file taxes for themselves and the deceased spouse by April 15 of the following year. Discuss with your estate planning attorney whether or not you’ll need to file a federal or state estate tax return, which is due nine months after death. Note that these may need to be filed even if no tax is due.

Reference: Forbes (April 20, 2023) “What To Do After The Death Of A Spouse”

You Can Avoid Unintended Consequences

“Although there is certainly no shortage of people with selfish or malevolent intent, a great number of estate plans that end in disaster are due to unintended consequences.”

The mistake can be as simple as signing a document without understanding its potential impact on property distribution, failing to have a last will and testament properly executed, or expecting a result different from what the will directs. Unfortunately, these unintended consequences are relatively common, says the article “Advice for avoiding unintended issues in estate planning” from The News-Enterprise.

The most common mistake that leads to unintended consequences is leaving everything to a spouse in a blended family. Even if children don’t have a close relationship with their stepparent, they’re willing to get along for the sake of their biological parent. However, when the first spouse dies, the decedent's beneficiaries are generally disinherited if the surviving spouse receives the entire estate.

If the family truly has blended and maintains close relationships, the surviving spouse may ensure that the decedent’s children receive a fair share of the estate. However, if the relationships are tenuous at best, and the surviving spouse changes their will so their biological children receive everything, the family is likely to fracture.

Using a revocable living trust as the primary planning tool is a safer option. An experienced estate planning attorney can create the trust to allow full flexibility during the lifetime of both spouses.  Upon the first spouse’s death, part of the estate is still protected for the decedent’s intended beneficiaries.

This way, the surviving spouse has full use of marital assets but can only change beneficiaries for his or her portion of the estate, protecting both the surviving spouse and the decedent’s intended beneficiaries.

Another common mistake occurs when married couples execute their last will and testaments with different beneficiaries. For example, if they’ve named each other as the primary beneficiary, only the survivor will have property to leave to loved ones.

An alternative is to decide what the couple wants to happen to the estate as a whole, then include fractional shares to all beneficiaries, not just the one spouse’s beneficiaries. This protects everyone.

Many people assume that if they die without a will, their spouse will inherit everything. Unfortunately, this is not always the case, and a local estate planning attorney will be able to explain how your state’s laws work when there is no will. Children or other family members are often entitled to a share of the estate. This may not be terrible if the family is close. However, if there are estranged relationships, it can lead to the wrong people inheriting more than you’d want.

Failing to plan in case an heir becomes disabled can cause life-altering problems. If an heir develops a disability and receives government benefits, an inheritance could make them ineligible. The problem is that we don’t know what state of health and abilities our heirs will be in when we die, and few will want their estate to be used to reimburse the state for the cost of care. A few extra provisions in a professionally prepared estate plan can result in significant savings for all concerned.

Estate planning is about more than signing off on a handful of documents. It requires thoughtful consideration of goals and potential consequences. Can every single outcome be anticipated? Not every single one, but certainly enough to be worth the effort.

Reference: The News-Enterprise (March 25, 2023) “Advice for avoiding unintended issues in estate planning”

Is Extending Required Minimum Distributions a Good Thing?

“The first SECURE Act extended the beginning date for taking required minimum distributions from the year after the account owner reaches age 70½ until they reach age 72. Just three years later, ‘SECURE Act 2.0’ has extended this age to 73, and offers a further provision for extending it again, to age 75, beginning in 2033.”

The question is, are these extensions a good thing, or a trap for people who aren’t up on the latest rules? A key concept is the difference in how couples and singles are taxed. The income level at which singles reach tax bracket thresholds is half that of married people filing jointly, explains a recent article titled “Are Extended RMDs A Gold Mine Or Tax Trap?” from Financial Advisor.

For example, a retired couple reaches 70½ this year. They’ll have an RMD of $89,450 from their combined $2 million plus in IRAs. They also receive $27,700 in interest and dividend income during the year—exactly equal to the standard deduction for a married couple filing jointly. The federal income tax liability would be $10,294 (not including taxes on Social Security benefits).

Let’s say they opt not to withdraw the $89,450 during 2023. Instead, they wait and one of the spouses dies. The surviving spouse then withdraws $89,450 as a widow. The survivor’s federal income tax liability on the same amount becomes $18,192, or almost 77% higher than if both spouses were still living. The “single filer” penalty is an issue.

What’s more, the children of our example are likely to face a higher income tax rate on what’s left in their parents’ IRA when both pass away. They are likely to be in their peak earnings years at that point and have only ten years at most to take the entire payout after their parents die.

Finally, if the married couple takes IRA withdrawals earlier rather than later, they’ll see a step-up in basis for all the after-tax funds they’ve allowed to appreciate for the rest of their lives. This eliminates all income tax on the appreciation. This is an important income tax benefit you don’t get from IRA receipts after the death of the account owner. Perhaps this is what Congress had in mind when it extended the starting date for RMDs not once, but three times.

It could be argued that singles, including surviving spouses, will see IRAs grow more if they put off distribution even longer. However, eventually bigger amounts may push individuals or families into a higher income tax bracket later on, and the undistributed IRA would not get a step-up in income tax basis on the death of the original owners. The undistributed IRA amount also can’t be rolled into a Roth IRA.

Tax brackets strategies can be improved if the couple takes withdrawals before they turn 70 ½, as long as they are retired and not in a high-income tax bracket. By taking increasing RMDs later in life, it’s possible to increase the federal income tax bracket, and risk triggering the single-filer penalty on the widowed spouse.

Estate planning for the SECURE Act means if you haven’t had your estate plan reviewed in the last two or three years, it’s time to make an appointment with an estate planning attorney. These changes in the law may create new opportunities, or your existing estate plan may not be properly structured to address the changes brought about by Congress.

Reference: Financial Advisor (March 1, 2023) “Are Extended RMDs A Gold Mine Or Tax Trap?”

What Happens When There Is No Will?

“Creating a will should be the first step in a comprehensive estate planning process, since it allows you to make sure that your wishes are properly carried out after your death.”

A will ensures that your personal and financial assets are given to the people and organizations you want. It also allows you to choose the person you want to settle your affairs, known as your executor. The time to have a will prepared is typically the same time people have a power of attorney and healthcare proxy forms prepared, according to the article “What Happens if You Die Without a Will?” from The Street.

Your estate plan is the term used to describe having all of these and other tools prepared to work together. It has nothing to do with the size of your estate, which could be modest or major. Regardless of the financial size or complexity of your life, you need a will.

What happens without a will?

A married person with children who dies without a will does the family a great disservice. All property, including real estate, investments and accounts that are jointly owned with the spouse go to the co-owner without needing to go through probate. However, separately owned property and accounts are distributed by the state in the absence of a will. Depending on the state, one-third may be awarded to the surviving spouse, and the remainder may be divided among the children. If the children are minors, the funds will be held in an account only accessible with court approval. The family may find itself without sufficient funds to maintain its lifestyle.

A person who is married but has no children or grandchildren and dies without a will may have their entire estate given to the surviving spouse. However, some states have a cap of $100,000. Other states give a third of to one-half of assets to the surviving spouse and the rest to the deceased’s parents, if they are living, or to the siblings. Jointly owned property, accounts and community property go to the surviving spouse.

What about a single person with children? With no will, the state law gives the decedent’s assets to surviving children in equal shares. If an adult child is deceased, their share is split among their own children (the decedent’s grandchildren). However, if the children are minors, the money is subject to court control and supervision.

If someone who is single and has no children dies, the state usually gives their assets to surviving parents. If the parents are not living, the assets will be distributed to the decedent’s siblings, or nephews and nieces, if the siblings have also passed. The state will reference a consanguinity chart—a chart used to help identify relationships of people showing degrees of family relationships by blood or marriage. Assets may pass to distant cousins who have never met or even known of the existence of the decedent.

If there are no living family members, the estate typically goes to the state itself.

When a member of an unmarried couple dies without a will, the surviving partner has no legal rights at all. Only spouses and relatives are recognized by state law. The partner will not inherit anything; assets will pass as if the person was single.

Domestic partners are treated differently in different states. In some states, they have inheritance rights, but this is state-dependent.

An experienced estate planning attorney can create a will and related documents to ensure your wishes are carried out upon your death. Otherwise, your estate will be distributed according to the laws of your state. You can protect yourself and your loved ones with a will.

Reference: The Street (Jan. 2, 2023) “What Happens if You Die Without a Will?”

What Does a Last Will and Testament Do?

“A last will and testament is essential for every adult. It establishes one’s wishes for distributing their property, whether real or personal, after death.”

Your will is the foundation of an estate plan, used to instruct your executor on distributing property, naming a guardian for minor children, creating a legacy and ensuring that your beneficiaries receive what you want. The will can also serve to disinherit a family member, as explained in the recent article “Last will can both include and exclude heirs” from The Record-Courier.

The process of cutting someone out of a will is known as “disinheriting.” Hurt feelings and tension among family members are inevitable when someone is disinherited. However, if the goal is to avoid litigation between family members, an experienced estate planning attorney will be needed. It takes careful planning to avoid creating a will contest. Disinheriting adult children increases the likelihood of them contesting the validity of the will.

Laws concerning inheritance rights vary. In Nevada, for instance, unless there is a prenuptial agreement, you cannot completely disinherit a spouse. Even if your will attempts to disinherit a spouse, in some cases the law will actually override the instructions in the will or trust and award a portion of the estate, known as the elective share, to a surviving spouse. If this is a concern, check with your estate planning attorney.

Adult children can be disinherited. However, minor children are often protected against disinheritance.

Parents can be disinherited if they outlive the decedent, since they are not always legally entitled to a share of their children’s estate.

Extended relatives can also be disinherited. Some estate planning attorneys will conduct a search for missing heirs or beneficiaries while preparing an estate plan to be sure there are no unknown legal heirs who might make themselves known to a decedent’s surviving spouse or other heirs.

Estranged biological children can be disinherited. However, the last will and testament must be properly prepared.

The reasons for disinheritance very from estrangement to the decedent believing their family member is financially secure and doesn’t need the inheritance. It is not necessary for the last will and testament to explain the reason for the disinheritance. However, it is advised to use a disinheritance clause to ensure the heir or beneficiary is removed and will not inherit under the will.

To protect the integrity of the will, it is also advised to include a no-contest clause in the will. This is a provision expressing a directive to eliminate the share allocated to any beneficiary who takes action to contest the testator’s intents as expressed in the will.

The last will and testament is the person’s last communication with loved ones. There is no further opportunity for clarification once they have passed. This is why it’s so important to have a will and for the will to explicitly state the names of the beneficiaries and the names of any disinherited persons.

When you meet with your estate planning attorney to create or update your last will and testament, be prepared to tell them if there are any family members who you want to disinherit, so they can create a last will and testament and an estate plan designed to withstand challenges.

Reference: The Record-Courier (Dec. 17, 2022) “Last will can both include and exclude heirs”

What Happens When Gift and Estate Tax Exemptions Change?

“The federal lifetime gift and estate tax exclusion will increase for 2023, with possible increases for 2024 and 2025. However, these high thresholds are only temporary, unless there is a change in tax law.”

The federal lifetime gift and estate tax exclusion will increase for inflation in 2023 to $12.93 million.  There may be similar increases for inflation in 2024 and 2025, according to a recent article from Think Advisor titled “The Estate and Gift Tax Exclusion Shrinks in 2026. What’s an Advisor to Do?”

This is the good news for wealthy Americans. However, there’s bad news in the near future. Under the Tax Cuts and Jobs Act, these historically high levels will end on December 31, 2025. Estate and gift exclusions will drop to the pre-2017 level of $five million, adjusted for inflation. Estimates for 2026 vary, but most expect the amount may reach $6.8 million per person.

For Americans who saw the value of their homes and portfolios increase in the last ten years, this level becomes uncomfortably close when considering the overall value of their estate. Here’s some help on how to minimize estate taxes in coming years.

What is the Estate and Gift Tax Exclusion in 2023?

Every year the annual estate and gift tax exclusion is adjusted for inflation. Gifts at or below this amount are not counted towards your lifetime exemption. For example, in 2022, the annual exclusion was $16,000 and in 2023, it is $17,000.

If you haven’t made any gifts to remove assets from your estate before 2026, your lifetime gift and estate tax exemption will revert to 2026 levels. If you made gifts prior to 2026, several different scenarios may apply.

If the amount of your gift was less than the exemption amount in place in 2026 or beyond, your remaining exclusion will be the amount of the exemption minus the amount of your lifetime gifts. Let’s say the exclusion is $6.8 million and you’ve given $3 million in lifetime gifts. The remaining exclusion would be $3.8 million. Any gifts over this amount would be subject to estate taxes.

If the amount of your gifts before 2026 exceeded the limit in place, the exemptions from the old limits will apply to those gifts. However, there won’t be any additional exemptions. Here’s an example: if you made $9 million in gifts before 2026, this would be your exemption amount upon your death. There would be no additional exemption for 2026 or beyond, unless the inflation-adjusted exemption exceeded $9 million in the future.

To be blunt, the higher exemption amounts in place are “use it or lose it.” Any difference between the higher exemption amounts and the post-2025 reduced amounts will be lost if not used. Any gifts made in excess of the higher exemptions in place before 2026 will still fall under the higher exemption upon death.

There are steps to be taken to reduce your taxable estate and make the most of the current limits. Which steps to take depends on the size of the estate, the nature of heirs, marital status, health status and other factors.

One strategy is to spend down assets. Take the big vacations, travel to out of town sporting events, enjoy the wealth you worked so hard to accumulate. This lifestyle can add up over time and fit in with an overall plan of minimizing your taxable estate.

Gifting to charity is another excellent way to reduce the size of a taxable estate while building a legacy. Current-year gifts of cash appreciated securities and other assets can provide a tax deduction to also reduce current year income taxes. Speak with your estate planning attorney about using a Donor Advised Fund, Charitable Lead Trust, or Charitable Remainder Trust.

If you are married, assets left to a surviving spouse have no estate tax consequences, except for a non-citizen spouse, who may not benefit from the unlimited marital deduction rules. One option is for the surviving spouse to elect to take the decedent spouse’s unused lifetime exclusion.

Reference: Think Advisor (Dec. 7, 2022) “The Estate and Gift Tax Exclusion Shrinks in 2026. What’s an Advisor to Do?”

How Do You Stop a Sibling from Stealing an Inheritance?

“The death of a parent can be emotionally trying, especially if the passing was unexpected. It can also be a test of your patience, if there are complicated estate issues to sort out.”

If the parent does not have a will, there may be questions about which sibling should inherit what. This gets complicated fast. State law can define siblings’ rights after parents’ deaths, explains a recent article from yahoo!, “Can a Sibling Take Your Inheritance?”

An estate planning attorney can be a valuable resource, regardless of the size of the estate.

When a parent dies and there are multiple siblings, what they can inherit depends on a few factors:

• Did the parent leave behind a will or were trusts created?
• Is there a surviving spouse who can inherit?
• What are the state’s inheritance laws?

For the most part, state inheritance laws give precedence to a surviving spouse ahead of any children. Some states grant children the legal right to inherit from a parent’s estate, even if they were not included in the will. However, most states allow parents to exclude children from their will, which can block them from inheriting anything.

How does a will determine siblings’ rights after the death of a parent? The will lets the person making the will specify how they want their assets to be distributed upon their death. The will, once deemed valid by the court, serves as the basis for dividing the estate.

If both parents died at the same time their estate would be divided among siblings according to the terms of the will. There are a few different ways this is done.

• One child inherits the house and the contents, while the other siblings divide any remaining assets in the estate.
• The executor sells the home and contents then splits the proceeds of the sale among siblings.
• Each sibling receives specific property or assets from the estate
• One child receives the entire contents of the estate, to the exclusion of others.

Estate planning becomes more complex when there are children from multiple marriages with different parents. Whether or not half-siblings receive the same inheritance as full siblings depends on state law.

If there is no will, state inheritance laws generally rely on a kinship order. In New York State, the first $50,000 in assets plus half of the remaining assets go to the surviving spouse first. The remainder is then distributed among any bloodline children.

Are siblings entitled to see the contents of wills or trusts? If they are beneficiaries, most states will permit a viewing of the will or trust documents. However, if someone is not listed in the will or a trust as a beneficiary, they don’t have an automatic right to review these documents.

If a sibling doesn’t agree with the terms of a will, or the distribution of assets, they could challenge a will in probate court. They can also petition the court to ask for a larger share of the estate. For instance, if one sibling was the primary caregiver for many years, providing financial and health care support, they would ask the court to take this into consideration.

An estate battle based on the distribution of property by a deceased parent can be avoided by having good communication between parents and siblings about the parent’s estate plan and their wishes. An experienced estate planning attorney creates plans for families to address their unique issues, and this can preclude sibling rivalry, which can sometimes get worse, not better, as the years go by.

Reference: yahoo! (November 30, 2022) “Can a Sibling Take Your Inheritance?”

Can You Plan for Probate?

“The probate process can be expensive for some estates. Settling an estate through probate can cost you both time and money.”

What can you do to help heirs have a smooth transition when settling your estate? A recent article from The Community Voice, “Managing probate when setting up your estate,” provides some recommendations.

Joint accounts. Married couples can own property as joint tenancy, which includes a right of survivorship. When one of the spouses dies, the other becomes the owner and the asset doesn’t have to go through probate. In some states, this is called tenancy by the entirety, in which married spouses each own an undivided interest in the whole property with the right of survivorship. They need content from the other spouse to transfer their ownership interest in the property. Some states allow community property with right of survivorship.

There are some vulnerabilities to joint ownership. A potential heir could claim the account is not a “true” joint account, but a “convenience” account whereby the second account owner was added solely for financial expediency. The joint account arrangement with right of survivorship may also not align with the estate plan.

Payment on Death (POD) and Transfer on Death (TOD) accounts. These types of accounts allow for easy transfer of bank accounts and securities. If the original owner lives, the named beneficiary has no right to claim account funds. When the original owner dies, all the named beneficiary need do is bring proper identification and proof of the owner’s death to claim the assets. This also needs to align with the estate plan to ensure that it achieves the testator’s wishes.

Gifting strategies. In 2022, taxpayers may gift up to $16,000 to as many people as you wish before owing taxes. This is a straight-forward way to reduce the taxable estate. Gifts over $ 16,000 may be subject to federal gift tax and count against your lifetime gift tax exclusion. The lifetime individual gift tax exemption is currently at $12.06 million, although few Americans need worry about this level.

Revocable living trusts. Trusts are used to take assets out of the taxable estate and place them in a separate legal entity having specific directions for asset distributions. A living trust, established during your lifetime, can hold whatever assets you want. A “pour-over will” may be used to add additional assets to the trust at death, although the assets “poured over” into the trust at death are still subject to probate.

The trust owns the assets. However, with a revocable living trust, the grantor (the person who created the trust) has full control of the assets. When the grantor dies, the trust becomes an irrevocable trust and assets are distributed by a successor trustee without being probated. This provides privacy and saves on court costs.

Trusts are not for do-it-yourselfers. An experienced estate planning attorney is needed to create the trust and ensure that it follows complex tax rules and regulations.

Reference: The Community Voice (Nov. 11, 2022) “Managing probate when setting up your estate”

What’s More Important: Estate Plan or Trust?

“Trusts and estates are the two main legal structures for transferring assets to your heirs and beneficiaries. Each works in critically different ways.”

A will makes a one-time transfer of assets after death, while trusts allow assets to be transferred during life and after death. Each one has an important role to play in managing assets and protecting loved ones, reports an article “Estate vs. Trust: Do You Really Understand the Difference” from yahoo!.

An “estate” in this sense is everything you own at the time of your death. It doesn’t include anything you own together with someone else as a joint tenant with rights of survivorship. It also doesn’t include any assets with beneficiary designations. These are assets transferred or otherwise assigned to pass to another person when you die. Your heirs are anyone who receives money, personal possessions, or any other assets from your estate.

Let’s say a woman named Penny dies. The home she owns with her husband is not part of her estate, since it now belongs solely to her spouse. Anything she gave away while living is not part of her estate. Her estate owns anything she independently owned at the time of her death.

An estate is a temporary legal entity existing only to make a one-time distribution of the assets of a decedent. Once the assets have been distributed, the estate is closed. This doesn’t mean estates are short-lived. Some estates take years to settle, depending upon their complexity and how well-prepared the estate plan was.

Estates are distributed in two main ways: by the will, also known as the last will and testament, or by the legal chain of inheritance. A will contains a set of instructions for who gets the assets of the estate. If the deceased has a valid will, the estate is distributed under these terms.

If there is no will, the person has died intestate and assets are distributed according to state law. Most of the time, this means assets go to the next of kin. In most states, spouses have the top spot in the line of inheritance, followed by biological children, then parents, then extended family. The spouse often gets one half of the estate and the children divide the balance.

A trust is a legal entity holding and distributing assets according to the directions in the trust. The person who creates the trust, known as the “grantor,” establishes the conditions and may give whatever they want, at whatever time they specify. A trust is independent of the people who create and fund it. Assets placed in the trust belong to the trust until they are distributed.

Let’s say a person named Edward wants to create a trust for certain family members’ college expenses. He could set up a trust with his estate planning attorney, then fund it with $6 million. The trust could be overseen by his attorney acting as the trustee. The trust names children, nieces and nephews as beneficiaries. They ask the trustee for money to pay college tuition, and the trustee handles the distribution.

The trustee has the job of making sure the monies are used in the manner prescribed by the trust. Therefore, in this case, the attorney may decide to only make distributions directly to colleges to pay for tuition. The trustee is a fiduciary and their first responsibility is to carry out the instructions in the trust.

Trusts can be set up while you are living and they can survive the creator’s death, unlike a will. When a person who has set up a trust dies, the trust continues until it runs out of assets or until its terms dictate it be dissolved.

Trusts and estate plans both exist to distribute assets. However, they do so in very different ways. Your estate planning attorney will guide you as to how these two entities work together for your unique situation.

Reference: yahoo! (Nov. 9, 2022) “Estate vs. Trust: Do You Really Understand the Difference”

Is Spouse Automatically Your Beneficiary?

“If the surviving spouse is a second or subsequent spouse and did not have any children with the decedent, the surviving spouse takes even less.”

People make a grave error when they don’t have a will because they think their surviving spouse will automatically inherit all of their worldly goods. The laws of intestacy work differently, as explained in a recent article “Estate Planning: The spouse doesn’t always get everything” from nwi.com.

The surviving spouse rarely receives everything under the intestate laws. This often comes as a surprise to people. The usual response is “Oh, that can’t be right.” Oh, but it is!

In many states, one half of the decedent’s probate assets are distributed to the spouse and the other half are distributed to the decedent’s child or children.

If it’s a second or third marriage and the couple didn’t have children of their own, the surviving spouse ends up with even less.

Assets are divided between the spouse and biological children.

Bear in mind the intestate laws only apply to probate assets. Assets owned jointly will go to the other joint owner, as well as assets listing the surviving spouse as the beneficiary.

If you’d prefer to leave more to your spouse, you need a will. Intestacy literally translates to dying without a will. If you have a will and then die, you haven’t died intestate, and the provisions don’t apply.

However, there’s more to consider. Depending on your state’s laws, if you die and there are no living children, the spouse still doesn’t necessarily inherit everything. If your parents are living, they are also entitled to a portion of the estate.

This is another reason why it’s so important to have a complete estate plan, including a last will and testament, powers of attorney and health care power of attorney.

Trusts are used to control how assets are distributed, either during life or upon death. You can create a trust to be used by your spouse by creating the trust, funding it with assets and setting the terms of the distribution.

Each state has its own laws of intestacy, so an estate planning attorney who practices in your state needs to be contacted to determine what would happen to your spouse if you didn’t have a will. Your best recommendation is to meet with an experienced estate planning attorney and create a plan to protect your spouse and your children

Reference: nwi.com (Oct. 23, 2022) “Estate Planning: The spouse doesn’t always get everything”