What Happens If I Die Without A Will?

According to recent statistics, over 60% of adult Americans will die without having executed a Will.  (Probably the most famous was Abraham Lincoln, and he was a lawyer!).  Many people ask me: “What happens if I die and don’t have a Will”? This is technically called “dying intestate”. The quick answer is that every state has laws on intestate succession. This means that state’s laws determine where your stuff goes and who will be in charge of winding up your affairs once you are gone, if you have not provided for the same in a Will or Trust Agreement.  These laws must be followed as part of the process of probating a decedent’s estate, if probate is necessary. The professionals at Damon, Ver Merris, Boyko & Witte, PLC can assist you in deciding whether a Will and/or Trust Agreement would best suit your needs.

To be clear, certain assets are not subject to probate.  For example, if you own real property jointly (as tenants by the entireties or joint tenants) with another person(s), then that land will not have to go through probate and the decedent’s interest will automatically pass by operation of law to the other joint owner(s).  Likewise, if you have more than one name on a joint bank savings or checking account, then the survivor will receive the balance of the funds in the account upon the death of the other joint owner (unless it can be proven the other “owner” was only put on the account by the decedent for convenience purposes).   You can also deal with financial accounts through a “pay on death” designation, naming another person who is to receive the proceeds upon your death.  (It should be noted that putting property of any nature in joint ownership with another person, other than your spouse, can be replete with problems. These include creditor issues, bankruptcy, and divorce of the other party as well as possibly imposing personal liability upon such party for claims against that property).

If you have a life insurance policy, the named beneficiaries will receive the insurance proceeds upon your death without the need for probate (unless you have named your estate as the beneficiary).  In a similar fashion, the named beneficiaries on a retirement account (IRA, 401(k) and the like) will automatically receive the proceeds upon your death.  Also, the title to a motor vehicle, boat, motor cycle, or other titled vehicle can usually be transferred into the name of a close relative just by supplying a copy of the decedent’s death certificate and filling out a few forms at the Michigan Secretary of State’s Office.  Finally, most personal property (household goods and furnishings, clothes, jewelry, and the like) is not titled so it can be split up in whatever fashion the heirs agree upon or deem appropriate.

So, what happens to the car sale proceeds, the bank account where only the decedent’s name was on the account, the land is titled only in the decedent’s name, etc.?  This is where probate comes in and the laws of intestate succession are applied, as ownership of such items (and others) is tied up in the decedent’s name and he/she is no longer around to deal with the sale or liquidation of that property and transfer of ownership issues.  Thus, probate proceedings must be commenced in the local Probate Court which must appoint an individual to wind up the financial affairs of the decedent (in Michigan this person is called a Personal Representative) and divvy up what remains, in an appropriate fashion.

The State of Michigan (and all other states) has laws detailing where the decedent’s property (or proceeds) goes, which types of claims have priority in payment from the assets on hand, and also specifies who has priority in regard to acting as the Personal Representative in the probate estate.  The Personal Representative is a fiduciary who has the duty to account for all of the decedent’s assets and to follow the laws of intestate succession in carrying out his/her duties. The professionals at Damon, Ver Merris, Boyko & Witte, PLC can explain in further detail what “dying intestate” in Michigan means. However, the following is a shortened description of what would happen to your estate if a Will and/or Trust Agreement has not been executed.

In Michigan, if you die without having executed a Will, the laws of intestate succession state that if you have left a surviving spouse, and you have no surviving children or parents, then your surviving spouse gets everything.  Otherwise, generally speaking, the first $150,000 of your assets will go to your surviving spouse plus your spouse will receive ½ of the balance over such amount, with the remainder going to the decedent’s surviving descendants.  If the only other survivors other than the spouse are the decedent’s parent(s), then the surviving spouse gets $150,000 plus ¾ of the amount over $150,000. If none of the decedent’s surviving descendants are descendants of the surviving spouse, then the spouse’s share is limited to $100,000 plus ½ of the amount in excess of that figure. If there is no surviving spouse and the only survivors are your children, then they will divide up what is left equally, by representation.  If the survivors are your parents and your children, then your children take.  If there are no surviving children, your parents take.  If both of your parents are deceased, then your aunts, uncles and cousins may split up what is left.  If they do not exist then you look to descendants of your grandparents on both sides.  If they do not exist, then, potentially, your assets could escheat to the State of Michigan.

I often tell my clients that you have a Will whether you know it or not.  If you have not prepared a Will then your “Will” was effectively drafted by the State of Michigan (by virtue of the intestacy laws) and you may not like what it says.  If you are content with letting your stuff go where ever the state says it should go, and do not care who is in charge of liquidating and distributing your assets, as well as the costs, delays, and lack of privacy associated with probate proceedings, then you probably do not have to do anything.  However, if you do not wish your spouse or children to be in charge of administering your estate once you are gone, want to make specific gifts of property to certain individuals or organizations, want to give one child more or less than the others for whatever reason (or desire to disinherit them), or want to name a guardian and/or conservator and/or Trustee to raise your children and take care of their financial needs until they are grown (esp. if they are minors), then you should probably consider doing something proactive – like making out a Will or Trust agreement and having it properly executed, so that it will stand up to any challenge that is made.

You have worked hard all your life to accumulate your “stuff”.  Don’t you think it is worth a little bit of your time (and money) to make sure it will go where you want it to go and not where the state says it should go?  Likewise, don’t you think it best that YOU name who is going to raise your kids, if you and your spouse are gone, as opposed to some unknown probate judge making this decision for you?  Follow the kindergarten rule and don’t leave it up to others to clean up your mess.  If you need help with your estate plan, please contact the estate planning professionals at Damon, Ver Merris, Boyko & Witte, PLC.  We are here to assist you in making these important decisions.  – Larry A. Ver Merris / September 21, 2017

While this posting originates from a law office, none of the contents should, in any way, be considered legal advice. If you have not signed a retention letter describing the legal services to be provided and the amount to be paid for such services, you are not a client of this firm.