A Last Will and Testament is simply a document that allows you to transfer your property when you die, to persons you name. The will also allows you full use of your property while you are alive. The law does not require anyone to have a will. However, a will is a useful tool that gives you control of how your estate will be divided.
Need for a will.
If you die without a will, Minnesota’s inheritance law will control how your estate will be divided, by application of a set formula. Generally, it goes to spouse and offspring first then to grandchildren, parents, brothers and sisters, and more distant relatives if there are none closer.
It’s all about control of what happens to your property. You don’t need a will if you set up provisions for transferring your property via trusts, life insurance policies with named beneficiaries, or joint property ownerships or joint bank accounts.
If you want to control the transfer of your property in a way outside the formula and you have not set up a mechanism in another way, you have to make your wishes known in writing. The law requires that it be confirmable, that it is really you who have expressed these wishes. The following rules apply.
- You must be an adult (at least 18) and be “of sound mind.”
- The will has to be in writing.
- The will must be signed by you or someone whom you directed to sign it in your presence. It can also be signed by your conservator when the court orders it.
- The will must be witnessed by at least two people. Witnesses must also sign the will.
- It must be clear that you intended the document to operate as a will.
The will may be accompanied by “Self-Proving” affidavits acknowledging that you signed and executed the will voluntarily. These must be signed by you and witnesses. This kind of self-proved will can avoid any claims that the will was improperly executed.
Probate is the court process for preventing fraud after someone’s death. It legally freezes the estate until a judge determines the validity of a will, is assured that all relevant people have been notified, that appraisals have been completed, that creditors and taxes have been paid. Once all this has been done, the court issues an order distributing the property and closing the estate. Very small estates will not require probate in Minnesota. The definition of a “small estate” varies with location within the state and other factors.
There are three kinds of probate in Minnesota,
- Informal–when heirs and beneficiaries have no conflicts or creditor problems.
- Unsupervised–takes the form of a court proceeding to settle disputes that have arisen.
- Supervised-Formal–when the court steps in to supervise the entire process and approves all the distribution of property.
Ownership surprise: One couple had a deed that written in “joint ownership” form specifically indicating that both partners owned 100% of the property. When one of the partners died, the other still owned 100% of the property without requiring probate. Another couple had a “tenants in common” deed listing each member of the couple as owning 50% of the property. In that case, when one member died, the other had to go to probate to recover the other half of the property.
Joint ownership means survivor wins all. That isn’t the best scenario for everybody. If a member of a couple want to pass his or her portion of the property to a third-party, a “tenants in common” deed is far simpler.
Leaky trust: A man set up a trust to pass his assets to a close friend on his death and avoid probate. However, he neglected to include all his assets and left some important ones outside of the trust. When the man died, his close friend still had to face a probate court judgement to receive all of this inheritance.
For 25 years, Kyle R. Bailey, Attorney at Law, and his staff have helped many clients in estate management law. If you live in Minnesota, please contact us to learn more.