One of the most common questions we are asked by estate planning clients is what would happen to their documents should they relocate to another state.
What should you know about moving to a different state as pertains to your estate plan?
And when we meet with clients who have recently relocated, what do we review in their existing estate planning documents?
First, understand that your estate planning documents will remain valid if you move to a different state.
We begin with a word of reassurance.
If you do move to a different state, your estate planning documents will remain valid and enforceable. You do not need to run to an estate planning attorney to have new documents prepared immediately.
However, as we will discuss below, there are state-specific issues that may well warrant an update or refresh of your documents. At a minimum, a consultation with an estate planning attorney in your new state of residence is likely well worth the time.
Powers of Attorney
Many states have their own statutory forms of medical and financial power of attorney.
To be clear, this does not mean that State A would not recognize a State B form of power of attorney executed by a former resident of State B.
As a practical matter, these forms can differ dramatically in form and substance. Many medical providers and financial institutions are accustomed to dealing with the form of power of attorney (medical or financial) in the state where they are located.
Therefore, while it is not required, it may be a good practice to obtain and execute new powers of attorney in the form and substance familiar to local doctors and banks so that if these documents need to be employed, there is likely to be greater ease and familiarity by the person being asked to honor the document.
Wills
There are at least two reasons why your Last Will and Testament should be reviewed by an estate planning attorney in your new state of residence.
First, each state has its own laws regarding the formalities for executing a Will. Some states, for example, require that a notary notarize the will. Other states have laws directing that if a witness to the Will is also a beneficiary, that beneficiary’s interest in the Will is automatically forfeited. Therefore, it is a good idea to have an estate planning attorney in your new state of residence review your Will to make sure that it complies with the laws of your new state in form and manner of execution.
Second, each state has its own probate laws and procedures. These procedures can vary dramatically from state to state. Many states may have procedures that offer a greatly streamlined form of probate. However, in these states, often the Testator (the person making the Will) must affirmatively opt in to the simplified procedure within the terms of the Will. Again, it is a good idea to have an estate planning attorney in your new state of residence review your existing Will and ensure it is structured to facilitate the most efficient probate process possible.
Trusts
Perhaps no set of laws differs as dramatically from state to state as trust law.
Many states have adopted the Uniform Trust Code (or portions thereof). Other states retain common law or state-specific laws.
Just by way of example, state trust laws may differ dramatically in the rights of a beneficiary to an accounting and the ability of the trust maker to limit accounting obligations of the Trustee to beneficiaries. State trust laws may also differ dramatically in how trustee compensation is calculated or charged, as well as in other procedural matters relating to the administration of the trust. These laws may conflict with your goals and objectives and warrant amendment of your trust to accommodate the change of applicable state law.
Your trust also likely has a “governing law” provision and a “situs” provision. These provisions may well warrant updating if you move to ensure that, if there is ever a conflict or dispute in the administration or interpretation of your trust, your loved ones are proceeding in a convenient court and in a court that is familiar with the law governing your trust.
If your trust is a “revocable trust” or a “living trust”, you retain the right to freely make amendments. If your trust is an “irrevocable trust”, while amendments may be possible, they are often limited in scope to administrative provisions and will likely require the notification, of and agreement by, the beneficiaries.
Final Thoughts
Again, if you relocate to a different state and you have already gone through the cost and effort of creating an estate plan, your estate plan will not suddenly vanish! You still have valid and viable planning documents. However, in the long checklist of post-move tasks, consulting with a local estate planning attorney in your new state of residence might ensure that your estate plan most clearly matches local customs, procedures, and laws, and potentially saves your family from future headaches.
Did you recently relocate to Maryland or the District of Columbia? If so, please contact the estate planning attorneys at Bulman Dunie for a complimentary review of your estate plan. Jeremy Rachlin can be reached at (301) 656-1177 x305 or jrachlin@bulmandunie.com, and Liz Farley can be reached at (301) 656-1177 x316 or lfarley@bulmandunie.com.
