A lot of people never get around to estate planning. So, what happens when a person dies without a plan? Well it depends what state you are in. Because we are in Arizona, we’re going to talk about what happens if you die without a will in Arizona. If you’re in another state different rules apply.
What happens to your property?
One question people have when a person dies without a will is how that person’s property will be divided. The answer can depend on how assets were titled. It can also depend on if there are any beneficiary designations or beneficiary deeds on the property. Wills and trusts are not the only way to plan for what happens to an asset on a persons death. If an account or property has a joint owner, a beneficiary designation or is a transfer on death or payable on death account, then the property will be distributed according to those designations.
If none of those situations apply, the rest of the estate passes according to the rules of intestate succession.
Intestate Succession
“Intestate” is a word we use to describe when someone dies without a will. Each state has their own intestacy rules. In Arizona, the rules live in A.R.S. Section 14-2101 et seq. The rules are lawmakers’ best guess as to what they think most Arizonans would want if they were to die without a will. The gist is that it goes to your family.
If there is a Surviving Spouse:
If you died intestate and left a surviving spouse, your spouse is entitled to at least some of your estate. Your spouse inherits all of your estate if you didn’t have any descendants (children or grand children). The same is true if all of your children are common to you and your spouse. A.R.S. Section 14-2101(1).
It gets more complicated if you died leaving a surviving spouse and children from a prior relationship. If there are surviving children from a prior relationship, the surviving spouse is only entitled to one-half of your separate property and no interest in your one-half of the community property. Your one half of your community property and the other half of your separate property goes to your surviving descendants. A.R.S. Section 14-2101(2).
If there is no surviving spouse:
If you died and have no surviving spouse, then your estate goes to your descendants. No descendants? Then your estate goes to your parents. Your estate goes your parents descendants (your siblings or nieces and nephews) if your parents aren’t surviving. If your parents have no descendants then it goes to your grandparents. And, if your grandparents aren’t surviving, it goes to their descendants (your aunts, uncles, cousins, etc.). A.R.S. Section 14-2103.
It’s good to note that an adopted child is considered a child of the adopting parents for purposes of intestate succession. A.R.S. Section 14-2114. A step-child who is never adopted by the step parent is not considered a child of the step-parent for purposes of intestate succession. And finally, a relatives related by “half blood,” like a half sibling, are treated as though they were “whole blood.” A.R.S. Section 14-2107.
It is only if there is no one to take the estate under the intestacy rules, that it passes to the state. A.R.S. Section 14-2105.
What if I don’t like these rules?
These rules are blanket rules that Arizona law makers think most people would want. That doesn’t mean that they are the rules that you want. If you don’t like the intestate succession rules, the best thing you can do is make a will (with the help of an estate planning attorney, of course). Maybe you want to change the percentages of your estate each child receives. Or, maybe you want to benefit a niece or nephew or parent or grandchild even though your children are still living. Maybe you want to leave money to charity or a friend. These are all easily accomplished with a will, but not possible without one.
Another thing that the intestate succession rules don’t account for is family members that may require extra planning. For example, if one of your heirs is a person with disabilities. In order to prevent that heir from losing their means-tested benefits they may need to receive their share in a special needs trust. This isn’t something that intestate succession rules contemplate.
What if I do like these rules?
Even if you are ok with the distribution scheme laid out in the intestate succession rules, it still is a good idea to do a will. First of all, having a will, even one with dispositive provisions that match the intestate succession rules can provide clarity and comfort to your family that describes you. It can confirm for them what your wishes really were.
Also, a will does more than just express your wishes for how your personal property is to be distributed. It says who should be in charge of administering the estate as well. While Arizona law has an order of priority for who should serve as your personal representative (a/k/a executor), the first person on the list is the person nominated in the will. Once again nominating a personal representative in the will can provide a lot of clarity about who you wanted to be in charge. Having a properly executed will also usually makes the probate process a lot smoother for those trying to administer the will.
Finally, a will can also include information about your final wishes, set up trusts for minor children who may receive an inheritance from your estate and more. It really is best to have a will drawn up by an estate planning attorney.
