If I die without a will, what happens to my property?
If you die without a will, you are deemed to have died “intestate” and your property will be distributed in accordance with the law of the state where you died. Generally state statutes split the estate between the surviving spouse and children. In Maryland a surviving spouse receives one half of the estate if there are minor children and one half of the estate plus $40,000 if the children are all adults. In the District of Columbia assuming that children are all from the same marriage, the surviving spouse will receive 2/3 of the estate and the children receive the balance. As long as you have some living heirs, your estate will not be lost to the government.
Who can write a will?
Anyone of sound mind who is 18 or older may draft a legally binding will. In order for a will to be valid, in either the District of Columbia or Maryland, it must generally be in writing, and signed in the presence of two disinterested witnesses before a notary public.
What does it mean to "be of sound mind"?
Being of sound mind means that you understand what your possessions are and to whom you’re leaving them. Being elderly or intellectually challenged does not mean that a person is incapable of making their own decisions, and does not preclude them from writing a will. Even a person diagnosed with dementia, may be considered competent to execute a will if at the time of the signing they had the requisite understanding of the terms of the document, including the nature of their assets and those whom they wish to receive them.
Do I need to include my adult children and spouse in my will?
No. You do not have to leave assets of your estate to your children or your spouse; however, if either exist, regardless of whether you leave them anything, you should mention them in the will. Otherwise they may file a claim against the estate arguing that you simply forgot them.
Although you need not leave anything to your spouse in your will, if you don’t, he or she will likely have the right to file a claim against your estate based on what’s known as the “elective share”. State elective shares vary, but usually range between 1/3 and 1/2 of your assets. In determining the amount of the elective share, some states only include those assets passing under your will (“probate assets”) while others include non-probate assets as well.
Can I give all of my estate to charity?
Yes. You may name a charity as a beneficiary in your will. If the charity no longer exists upon your death, the court will usually distribute the property as closely as possible to your wishes. In some instances, however, the gift could lapse and be distributed to your residuary beneficiaries named in your will.
Will my heirs need to pay estate or inheritance tax?
For the year 2020, there is no federal estate tax on estates under $11,580,000. 13 states including the District of Columbia impose a local estate tax.
In the District of Columbia you will pay no estate tax unless your estate exceeds $5,600,000. In Maryland no estate tax is imposed unless your estate exceeds $5,000,000.
In addition to it’s local estate tax, Maryland imposes a 10% inheritance tax on assets passing to certain individuals. Individuals exempted from the tax include:
- Spouses
- Children, stepchildren and grandchildren
- Parents and stepparents
- Siblings
- Grandparents
- Spouses of a child, stepchild or grandchild
- Surviving spouses of a deceased child, if the surviving spouse has not remarried.
Estate taxes laws are subject to change. You should consult a knowledgeable estate lawyer for more information