What Are The Financial Implications To Heirs If You Die Without A Will

What will happen to your property if you die without a will and how will this affect the ones who are supposed to be your heirs?

Heirs

The consequences of a property owner dying without making a will depends on how much property is owned, the location of the said property, if there are debts left behind by the owner, and if there are rightful heirs who survived.

One thing is sure, if you die without a will it will cost you. If you have assets and you die without leaving behind any explicit instructions as to who shall inherit your possessions the property is called Es-cheated Property. The State will take over the management of your property and determine based on law who shall receive what.

Furthermore, if the State executes management status over your property this is going to involve several fees that would have been unnecessary had there been a will in place.

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Hiring a Dependent Administrator

Generally, what happens when you die without a will or in proper term dying intestate is that any cash you left behind will be deposited as General Fund in the Treasury Division. Then all personal property will be sold and the proceeds will be added on to the General Fund.

Meanwhile a court appointed Administrator is needed in all this to manage all these responsibilities. The first and perhaps the most expensive default procedure in matters of distributing an intestate’s property is when the State hires a Dependent Administrator. Since court approval is required for every action taken in the management of your property after your death the local court will select a person based on a list provided by law.

The Administrator’s task is to locate everything you own and manage it for the court during the entire time that the court processes its decision as to how the property will be distributed to the heirs based on law. The Administrator will naturally charge a fee for his services and this will be taken out from your assets. This is just the tip of the iceberg because estate taxes and guardianship is going to hike the fees up even more.

Who will handle the financial responsibilities?

When it comes to distributing your property the State will determine based on law who among your survivors will receive an inheritance. If you are survived by a spouse and children who are not yet of age the law depending on the State will give a legal portion to the spouse. The remaining share will go to your children. Unfortunately both your spouse and your children are unable to get hold of the assets because:

  • the surviving spouse does not have any authority over your children’s inheritance and
  • the children will only get their inheritance once they reach legal age.

This means the surviving spouse will have to handle all the financial responsibilities of bringing your children up. In the meantime the management of the children’s money will be left under the care of the State appointed Administrator.

Another downside to all this is the death tax which is enormously high. Simply put what your heirs will receive and divide among them will be whatever is left after deducting taxes, debts, and dependent administration costs. An expensive problem for your surviving heirs

Dying without a will is going to cause more heartbreak and huge financial problems to the family you left behind. Your surviving loved ones will have no control over your properties after your death. Since the Law has the right to appoint who will legally manage the affairs during the entire legal procedure your heirs will have no say on anything. Your children are the ones who are most disadvantaged especially if they are a minor because:

  • someone else as determined by the court will manage their money until such time they have reached legal age. In the meantime, they have nothing.
  • the court has the right to determine if the children need another guardian other than the spouse. This will not only involve more fees but it could result to more conflict and the children may find themselves in the middle of a legal battle.
  • you would not know who the court will appoint as guardian and you won’t be assured if the person whom the court will appoint holds the same values you have.
  • worst case scenario is, if both parents died and there is no will as to who will take care of the children the kids could be placed into a foster home.

The consequences of dying intestate is expensive and it does not leave anything positive behind except perhaps for the State sine there are several taxes that will be taken out from your assets and the court appointed Administrator who will charge fees for managing your property. The ones who will suffer the most are the children who are left more vulnerable amidst this legal conundrum.

is a husband and working as a software professional for a Fortune 100 corporation in Florida. Thanks for visiting the blog.

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Comments

  1. says

    I hate thinking about wills and stuff – I get very morbid. :S I’m not sure if my parents have a will yet, but I suppose it’s something we’ll have to deal with eventually.

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