Marian and Roger married when they were teenagers, raised two children, and lived as husband and wife for 30 years. Roger created computer software that was essential to the industry. The royalties from this software has provided for their family handsomely. They have lived separate and apart for more than 20 years but never got a divorce. Roger and Ala have lived together for the 15 years. Roger purchased a separate home for himself and Ala. In his will, he left generous bequests to his wife, his children and Ala as well as the home in which he and Ala lived to Ala. Marian decided to elect against the will and walked away with both homes and half of the total value of the estate. Ala who is also known as Alan is now homeless and significantly, less well off than Roger planned even though Ala was the one who cared for him through his last illness.
The law has yet to catch up with the changes in society. The laws of intestate succession favor the concept of a traditional family. These rules allow a spouse to elect against the will and protect her from being disinherited by capriciousness of a spouse. Roger’s estate planning failed. He should have consulted with an estate-planning attorney and considered the following steps to protect Ala.
- Divorced his wife and had a determination of how the marital property should have been divided. The divorce would have terminated her ability as the spouse to elect against the will.
- Set up a trust agreement in which to transfer his property, which would have required the trustee to follow his wishes.
- Titled the house he purchased for Ala and himself jointly with right of survivorship. The house would have passed to Ala on his death outside of probate.
- Purchased life insurance with Ala as the beneficiary that would pass outside of probate
The scenario outlined above is an example of what can happen with ineffectual or incomplete estate planning. It is imperative to seek counsel that is experienced in handling issues involving non-traditional relationships to make sure your estate planning achieves your goals.
- Estate Planning is Essential Whether You Are Married or Not - April 25, 2018
- Income Tax Basis in Estate Planning – Part 2 - April 23, 2018
- The Downsizing Generation: How to Handle a Surplus of Stuff When a Loved One Ages - April 18, 2018