One of the purposes of a Will is to direct the disposition of a person’s assets. When a person dies with a valid Will directing the disposition of their assets, they have died testate. However, all too often, people die without first implementing the necessary estate plan – including a Will. When a person dies without a valid Will, the person has died intestate. In these instances, the state laws of intestate succession dictate how a person’s property will pass to that person’s heirs.
Each state is different and the laws of intestacy will be determined based on where the property is located. For instance, a person who resided in Colorado will follow Colorado law for any real property and personal property located in Colorado, but will have to follow the laws of any other state where they may have property located, such as an out-of-state vacation home.
My practice is located in Colorado and this post will focus on Colorado intestate succession. If you have any questions about intestate succession in another state, I recommend contacting the state bar of the state to get in touch with a local probate attorney. The information you obtain may be the motivation that a parent, spouse or friend may need to begin their own estate plan. As you will see, the laws of intestacy are not always in line with how someone would actually want their estate distributed.
In Colorado, the share of the spouse is determined first. C.R.S. 15-11-102. Most clients I have discussed this issue with believe that a spouse will receive everything in the absence of a Will, but this is not correct. A surviving spouse will only receive the entire estate of their deceased spouse if either a) all of the deceased spouse descendants (children, grandchildren, etc.) are also descendants of the surviving spouse (no step-children) or b) the deceased spouse had no surviving descendants or surviving parents. In all other scenarios, Colorado intestate succession contemplates a division of the estate between a surviving spouse and either a parent or a child.
The surviving spouse is entitled to the first $300,000 and ¾ of any amounts above $300,000 of the deceased spouse’s estate if the deceased spouse died with no living descendants but was survived by at least one parent. In this instance, the parent(s) would receive the remaining ¼ of any amount above $300,000 in the estate. This is primarily a concern for younger childless couples who have not planned properly. If a life insurance policy designates the estate as a beneficiary instead of the spouse, the influx of cash at death could result in a portion of the proceeds being distributed to the deceased spouse’s parent(s) instead of the surviving spouse.
The amounts to the surviving spouse are further reduced depending on the relationship between the surviving spouse and the deceased spouse’s descendants and if the surviving spouse has any descendants not related to the deceased spouse (step-children from either spouse). The surviving spouse will receive the first $250,000 plus ½ of the remaining estate if all the descendants of the deceased spouse were also descendants of the surviving spouse, but the surviving spouse also had one or more descendants not a descendant of the deceased spouse. Lastly, the surviving spouse is entitled to the first $150,000 plus ½ of the remaining estate if the deceased spouse has one or more descendants who are not also descendants of the surviving spouse.
After the surviving spouse’s share has been determined, or if the decedent was unmarried at the time of his or her death, the remaining amounts are distributed to the heirs of the decedent in the following order:
- To the decedent’s descendants;
- To the decedent’s parent(s);
- To the descendants of the decedent’s parents (brothers, sisters, nieces, nephews);
- To the decedent’s grandparents;
- To the descendants of the decedent’s grandparents (aunts, uncles, cousins);
- To the State of Colorado
The State of Colorado believes that the laws of intestate succession closely mirror the desires of the typical Coloradan. However, every estate plan I have ever drafted has looked vastly different than the state’s proposed distributive scheme. Most people have specific items that they would like distributed to certain people and the best way to ensure that those types of bequests are fulfilled is to draft a Will. What is even less clear is how to distribute tangible property. The formulas seem to work with money, but when real or personal property is involved, it can become very problematic.
Along with a Will, an estate planning attorney can discuss and draft necessary documents to make sure that nearly all contingencies have been accounted for both at death and incapacity and avoid many of these situations.
Patrick Curnalia is an estate and tax planning attorney with Curnalia Law, LLC. Patrick has worked with many clients to help them achieve their planning goals. Our firm services the entire Denver area and is located near the Denver Tech Center. Find out more about how our firm can help you by visiting our website at www.curnalialaw.com.