50 Different States: Another Reason to Plan Ahead
The U.S. has 50 different state songs, 50 different state birds, 50 different legal systems and therefore 50 different state probate laws.
Probate is the process that occurs in Court after death. It results in the distribution of your property to the next generation (or whomever you name as beneficiaries) and in the placement of your minor children with their guardian. The probate process occurs whether a valid Will (from the U.S. or Israel) was executed or not.
If a valid Will was not executed, the Intestacy or Inheritance Law applies to decide what will be distributed and who will inherit. Each state has its own Intestacy Law listing different assets that will be included in your estate, and different heirs who will inherit from you.
A former client, Harry Cohen (fictitious name), passed away recently, owning a bank account in New Jersey, a brokerage account in Chicago (Illinois) and a rental/vacation property in Florida. To pass each of these assets on to Mr. Cohen’s heirs (by Will or by Intestacy Law), his loved ones have to approach a Court in each of these states and start a separate probate process for each asset in each Court in each of the three states.
Practically, this means that just after death, a family or close friends must rally to contact several courts in different states, collect important documents and have some translated, complete bureaucratic forms for each Court, and most pressing – become familiarized with the Law in each state.
Proper estate planning would have would have saved Mr. Cohen’s loved ones time (3 different processes that are duplicative) and money (probate fee which is 5%-15% of the value of the asset in that state).
For more information about the estate planning process, see “How does the process work?”