Estate Planning

Drafting up a will or planning your estate for your heirs can be an uncomfortable thing to think about, much less to start doing. No one likes to contemplate their own mortality. However, making sure that you have a viable will in place, and that you have considered the appropriate way to plan your estate is essential to make sure your relatives are taken care of and that your final wishes are followed.

Why Wills Are Important

If someone dies without drafting a will, then all their property will pass ‘intestate,’ meaning it is divided up between that person’s living relatives and heirs. In Alabama, property passes to heirs as follows:

If the decedent was married:

  • The entire estate will go to the surviving spouse if there are no surviving children or parents of the decedent.
  • The first $100,000.00 of the estate, plus half the balance will go to the spouse if there are no surviving children but surviving parents.
  • The first $50,000.00 of the estate, plus half the balance will go to the spouse if the surviving children are all the direct descendants of the decedent and surviving spouse; and
  • One-half of the estate will go to the spouse if there are surviving children who are not the children of the surviving spouse (so this would be a step-parent scenario).
  • The remainder of the estate is divided between the spouse and surviving children.

If the decedent was unmarried, then property passes by order of ‘priority,’ meaning that the category of relative is ranked, and if there are no members of the family within that category, property will pass until someone acceptable can take it. The order is:

  • Children of the decedent
  • Parents
  • Siblings
  • Grandparents
  • Aunts and uncles
  • Cousins

Therefore, if the person dies without a will, the property is not particularized or divided up, and the decedent has no say in who will receive the benefit of their property upon death. Wills can be especially important if you have young children, to ensure that they are taken care of, even if your surviving spouse remarries, or if you were a single parent.

How to Draft a Will

First, you should start the process as soon as possible, particularly if you are older or are facing a terminal illness. You do not want there to be any question as to your lucidity or capacity in drafting the will, as these are grounds for invalidating it. The will must be written, signed by the person making the will, and witnessed by at least two people. Alabama does not recognize handwritten (or holographic) wills, so you will at the very least need to type the will if you decide to proceed on your own.

It is not necessary to hire a lawyer to do this – you can draft one on your own and it will still be valid. However, drafting a will can be somewhat complex, particularly if your estate is large. Hiring a lawyer will ensure that your will is valid, legal and that the property will pass to your heirs as you intended. A lawyer will also be able to offer advice on cost-saving exercises and the tax effects of the distribution of your estate. Lawyers can also ensure your will is self-proving, meaning that the heirs save time in the probate process by avoiding the requirement of the witnesses coming before the court to swear as to the testator’s signature.

Once you have drafted and executed the will properly, it is valid for all purposes for the rest of your life, with one exception. If you remarry, and you have not included your new spouse in the will, then the court may be able to modify or revoke the terms of the will and assume that you intended to include your spouse, but merely forgot. Generally speaking, unless a prenuptial or post-nuptial agreement says otherwise, a married person cannot completely exclude their spouse from a portion of the estate.

You should keep the original copy of your will in a safe place, such as a safety deposit box. If you hired a lawyer to draft the will, you should ask them to keep a copy as well. Should you decide to change the will for any reason, such as if you acquire a larger estate, remarry, or have more children, then you will usually need to create a new will that explicitly revokes the second. You may be able to add a ‘codicil,’ which amends a portion of the will as long as it meets the same formalities of a will. A lawyer can ensure that this is done properly to avoid any confusion after your death, and will be able to counsel you as to whether a codicil will be sufficient, or if it would be better to redraft your will entirely.

Miscellaneous Estate Planning Documents

In addition to a will, it is worth considering whether you need other documents concerning the inheritance or power of your estate.

  • A living will, or an advance medical directive, allows you to express your wishes concerning the medical procedures you would want to be done if you are in a terminal condition and cannot express these wishes yourself. For instance, if you want to be placed on life support, the conditions associated with that life support, or DNR orders. These wills are usually executed with a durable power of attorney for health care. This allows someone else to make decisions for your health if you are incapacitated.
  • A beneficiary designation will apply to assets that do not pass through your estate directly, such as life insurance. If you have designated a relative to receive the proceeds of life insurance, then you will not need to include this in your will. It is important to ensure that your beneficiary designations are kept up to date, particularly if you have divorced or remarried.
  • A revocable living trust is when someone creates a trust of their assets for their beneficiaries to enjoy. The person who has created the trust could manage the trust, or another relative could. Many people employ a professional trustee to administer the trust as well. Trustees control the management and distribution of the property and income of the trust, and it is often a great tool to avoid tax payments upon death. Often, this can all be done without the hassle of a probate or court proceeding.

What is Probate

Probate means ‘to prove,’ and is the process whereby the court ensures that the will is valid and that all of the property is actually disposed of properly, particularly real property. Anyone named in the will who is either a personal representative of the decedent, a recipient of property, someone with interest in the property, or someone in possession of the will itself, may request the court to probate the will. The will is almost always filed for probate in the county where the deceased lived, and it should be filed for probate within five years of the testator’s date.

It is better to have a probate lawyer assist you in the probate of the will, as the process can be complex, and the judge will be unable to advise you of the law. The steps to probate the will are as follows:

  • File the petition and take control of the estate
  • Within 2 months, file an inventory of the assets and debts of the estate
  • File a bond equal to the capital value plus one year’s income from the estate
  • Provide notice to all heirs and request a grant of Letters of Testamentary
  • Notice to file claims must be published within 3 week
  • All claims should be filed within 6 months of filing for probate, and the estate cannot be divided until all claims and expenses have been paid.

Probate can be a lengthy process, usually at a minimum of 6 months. If there is a contest as to the validity of the will or unknown claims that are disputed, then the process can take much longer.

Contesting the Will

In Alabama, any ‘interested person’ can contest the will. An interested person is someone who is either listed as a beneficiary in the will itself or someone who would receive a portion of the estate if the will is found to be invalid. A person can contest the will if they can demonstrate that the will does not reflect the true intention of the testator, that the will was improperly executed, or if there is evidence that the testator was not of sound mind when he executed the will or was under undue influence.

Undue influence can be shown if the decedent had a confidential relationship with a person in an influential position, who was controlling and dominant, and used that power to pressure or convince the decedent to draft the will in a way that would benefit that person. A common example of this is a caregiver for an elderly person who exerted their influence to convince their patient to change their will at the last moment, with a large portion being given to the caregiver. The Anna Nicole Smith case is an example that springs to mind.

Sometimes, a will may contain a no-contest clause, which states that if someone challenges the will, he will be completely disinherited. However, Alabama does not consistently enforce these clauses, and judges usually apply the clause to prevent frivolous petitions. If the will is successfully contested and found to be invalid, then the property will be distributed as under Alabama’s intestacy scheme.

Hiring a Lawyer

Obtaining a lawyer to help prepare your will is not required, but it is strongly recommended. Lawyers will be able to give you advice on minimizing the inheritance tax implications or help you set up a trust for your family. They can draft the will and ensure it will be legally valid and binding to carry out your desires after you’re gone. Get in touch with a licensed and experienced Alabama probate attorney today to help you ensure the well-being of your family, even when you will not be around to do so yourself.