Moving to a new home probably means making long lists of Things to Do. If you’re moving across state lines, be sure to add an Estate Plan Review high on the list.
Even though each state must honor legal documents made in other states, each state makes its own laws for the formalities and substance of wills, trusts, powers of attorney, and health care directives. This can lead to some confusing consequences. In other words, your old will or power of attorney may be a valid legal document but it may not be applied as you would think because local state law differs from your old home state’s laws.
To avoid costly and time consuming court proceedings about which state’s law will apply, here is a short checklist for your estate plan after a move to another state.
State laws differ widely on health care powers of attorney, physician’s directives, and living wills. Hospitals and doctors are most familiar with the medical directive forms under their state’s laws. When presented with documents created in another state there may be delays while their lawyers review the unfamiliar documents. So that a healthcare provider will not have any difficulty recognizing the validity of your document, it’s best to convert to documents under the laws of your new home state.
Last Will and Testament
Each state has its own rules about how wills are established and interpreted. There are important variations that are technical and that only a qualified estate planning lawyer will identify. For example, these technicalities may include who can serve as an Executor or Trustee; spousal inheritance rules; definitions of key terms; “default rules” if something happens that is not covered by the terms of the will or trust; estate or inheritance taxes; payment of claims; compensation for fiduciaries; and much more. A little attention now may avoid problems when a court has to interpret your will later.
Like wills, each state has its own laws governing trusts. Those laws were mainly judge-made laws for centuries. Development of law by judicial decisions instead of statutes enacted by state legislatures can take a long time and often lags behind current trends and issues. Thus, the development of the Uniform Trust Code. This is not a real law; rather, a set of model laws written by legal scholars, practicing lawyers, and judges who team up to provide a guide for state legislatures as they modernize and streamline state laws. Each state is free to adopt its own version of the UTC.
If you have a Living Trust, the nuances of state laws on trusts — whether judge-made laws or variations of the Uniform Trust Code — can significantly affect your inheritance plan. A review of your old trust by a qualified estate planning lawyer can identify appropriate amendments to allow full benefits under the new home state’s laws.
Property Power of Attorney
States are increasingly changing statutes that govern financial and legal powers of attorney. Your old document should compared to your new state’s laws to make sure there are no clashes and all relevant and available powers are included.
IRA’s are governed by federal law which applies the same to residents of all states. So why are they on this list? Because some states require a spouse to sign off on beneficiary designations for IRA’s, so make sure your beneficiary designations comply under your new home state’s laws.
Finding a lawyer in your new state can be a challenge. A good place to find a qualified estate planning lawyer is the American Academy of Estate Planning Attorneys, where you will find a listing of members across the U. S.