As an estate planning attorney, I often get the question: Do I really need a will? When answering this question, I like to explain what will happen if a Minnesota resident passes away without a will. This process is dictated by Minnesota Statute and is called intestate succession.
The basics
Any asset you have at your death that has a named beneficiary will go to the persons or entities you have listed. Life insurance, retirement savings accounts, and investment accounts are examples of assets that typically have a beneficiary designation attached. All assets that do not have a beneficiary named will be distributed according to the Minnesota intestate succession statute, Minn. Stat. Chapter 524. The statute goes through some general scenarios and lists the persons who will inherit if there is no will in place.
For example:
(1) If you have children but no spouse, then your children inherit everything equally.
(2) If you have a spouse but no descendants, then your spouse inherits everything.
(3) If you have a spouse and descendants only from you and that spouse, then your spouse inherits everything.
(4) If you have parents but no spouse or descendants, then your parents inherit everything equally.
(5) If you have no spouse, descendants, or parents, then your siblings inherit everything equally.
Going through this list, you may have already spotted some distributions you do not agree with. If this is the case, then drafting a will gives you the control to change who will receive your property. If your situation was not listed above, you may have an even more complicated situation should you pass away without a will.
Problem Scenario #1 – Second Marriage
If you or your current spouse have children from a prior marriage things get a little more complicated if you pass away without a will:
(1) If you have children from a prior marriage, then your spouse inherits the first $150,000 of your property, plus one-half of the balance. Then, your children inherit the remaining property equally.
(2) If your spouse has children from a prior marriage, then your spouse inherits the first $150,000 of your property, plus one-half of the balance. Then, your descendants or parents inherit the remaining property equally.
Problem Scenario #2 – No Children or Grandchildren
If you pass away without a will and you have no descendants (children or grandchildren), as described above, your parents or siblings will inherit your estate in full. Many people in this situation would like to see a least a portion of their estate go to a close friend or relative that is not a parent or sibling. Also, in this situation, many people wish to give a portion of their estate to a charitable organization. All of these things would be possible with a will, but would not happen in the absence of a will.
Therefore, to determine whether you need a will, you need to find out what would happen if you passed away without a will. If you don’t like what would happen under the Minnesota intestate succession law or are not sure what would happen, your best option is to execute a will that clearly stated the persons and entities you would like to receive your property. To understand your estate planning options fully, contact a knowledgeable estate planning attorney to discuss your specific situation.