A will is a legal document an individual uses to inform of how their affairs should be settled when they die and to appoint someone to settle their affairs. In a will, a person can bequeath (give) their property to their heirs.
The complexity of a will can range from basic to complex. For this article, we will focus on wills in connection to real estate. Spoiler alert: despite common belief, simple wills often create complex problems when it comes to family owned real estate.
Key elements in a will.
States vary on their requirements for a valid will. Below are the typical requirements.
The will must be executed by a person, known as the testator, who has testamentary capacity. In most states, testamentary capacity is for people at least 18 years of age with mental capacity when they sign the will.
The will document must state that the document is a will and that the testator is of sound mind and body when they are executing the will.
Someone should be appointed as the executor, the person responsible for settling the testator's affairs after death.
The will must contain provisions that give the testator work to do, such as pay debts and claims and give the testator's assets to the nominated heirs. 6. If the will is not written in your handwriting (i.e., typed), you must sign the will and it must be attested to by two witnesses who are not beneficiaries and who saw the will signed by you.
If the will is handwritten, it must be the handwriting of the testator. Typically wills that are typewritten or not written in the handwriting of the testator must be witnessed by two people and notarized in order to be effective.
When do wills become effective.
Generally speaking, wills become effective once they are probated, the legal process of a will being approved once the person dies.
For real estate transfers through will it is critical to get the will approved by the local authority responsible for approving wills, such as the clerk of court. If the deceased person's will includes real estate in another state, a copy of the approved will must also be filed in the other state. This is not unusual.
Importance of filing a will.
States vary on when real estate transfers by death are effective. Typically, the transfer is on the date of death. The probate of the will (filing and approval) is required to inform the public of the transfer and usually the effectiveness relates back to the date of death.
Wills and intergenerational owned, family owned real estate.
Wills are important tools for managing assets. If you want real estate to be owned in your family over multiple generations, a will can be an important part of your planning. However, simple wills create complex problems for real estate. Wills often do not avoid creating heirs property. And, courts do not like people to control from the grave. Wills often do not support planning beyond your generation of ownership and the next.